To Incorporate or LLC

[IDN]

First off, I'm in Washington in the US. I know these things affect the choice.

Now.. My question is for libability and profits, which is the best choice? Which offers the best libility and tax structure? I would be the only one the owns the company, and I would want to open a bank account. I assume both would offer me that choice. For an LLC or S-Corp/C-Corp what are the legal requirements to send back to the State? What is the different between S-Corp and C-Corp for a forum?

[Joe Gronlund]

S-corp- you're limited to number of shareholders and the business income flows through your personal income for tax purposes.
C-corp- more flexibility on size and number of shareholders and profits are distributed through divedends which are taxed as capital gains (after corporate profits are taxed)

I think S-corp does reduce your tax burden.

[IDN]

Thanks for the information, which is best for a forum. LLC, S-Corp or C-Corp? I run an Adult forum, so I need the liability.

[Chris Schreiber]

These links should help:

http://www.corporate.com/shouldIIncorporate.jsp

http://www.corporate.com/llc-vs-s-corporation.jsp

http://www.corporate.com/entity-comparison.jsp

[Steve Machol]

FYI, I went through the same ddecision process and went with S-Corp based on my accountant's recommendations.

[IDN]

Thanks Chris for those links.

Why did he say S-Corp Steve? I'm sure it is different in your state though.

[Steve Machol]

I forget all the reasons but basically is was for taxes.

[IDN]

Looking at some of the sheets it seems an LLC is the best way to go for a small business.

[ManagerJosh]

Unless you have a particular reason why you want to become an LLC or Incorporate, it's better not to do so. LLCs can get messy, especially when it comes around to tax time.

[Vtec44]

I also went with LLC. The main reason is that I can pass the profit through as personal income at the end of the year, basically you're taxed once. It's beneficial if your business makes a lot of profit. With either form of corporation, I believe that you're taxed at the corporate level, then again propotionally when you take out the profit. The down side of LLC is that you can't issue stock, so raising money is limited to private investments. I believe that's how my wife explained it to me since she does the accounting stuff We filed our tax for this year already, nothing too major.

[Vtec44]

Unless you have a particular reason why you want to become an LLC or Incorporate, it's better not to do so. LLCs can get messy, especially when it comes around to tax time.

A lot of people do it mostly for the protection of liabilities.

[Erwin]

A lot of people do it mostly for the protection of liabilities.

And protection of personal assets. If something goes wrong and/or you get sued, you don't want to lose your house.

[tgillespie]

Unless you have a particular reason why you want to become an LLC or Incorporate, it's better not to do so. LLCs can get messy, especially when it comes around to tax time.

If he is worried about liabilities, using a LLC is a lot better solution than being a sole propietor. You can file under personal income, but dont have the threat of loosing your house, your car, your dog, or your bank account.

[Vtec44]

You can file under personal income, but dont have the threat of loosing your house, your car, your dog, or your bank account.

That is just wrong

[IDN]

With either form of corporation, I believe that you're taxed at the corporate level

I believe S-Corp is like a LLC, a limited form an Incorporation. I'm just not sure about having to send in minutes, etc. How's the tax filing and business filings on an LLC for you? What are you required to do at the end of the year?

I don't see the major difference of why a Corporation is any better then an LLC. It seems a Corporation is more fuss just to have stock. I won't be selling stock for my website.