LLC(Limited liability company) or S-Corp

Limited liability company is a hybrid business format that has advantages from corporations and partnerships. Start-up cost is not little, for example, $800 Franchise tax board for California and $79 for filing, but many small business owners choose to pay this because of its benefits:

Limited liability - An LLC owner or LLC members are not personally liable for the LLC’s debts unless they have signed a personal guarantee.

Taxation flexibility - An limited liability company can choose to be taxed as a sole proprietor, S corporation, C corporation or partnership (”check-the-box taxation“).

Tax benefits (no double taxation) - Unlike corporations, an LLC is not taxed twice. The profits, losses and expenses of the LLC passes through the LLC to the LLC members (“pass-through taxation” or “flow-through taxation”) and the LLC itself is not taxed. In a corporations, both the corporation and the shareholders are taxed.

Management benefits (less documentation) - Unlike corporations, limited liability companies are not required to keep formal corporation minutes or record resolutions.

1 Comment

  • By NANCY, July 13, 2009 @ 2:21 pm

    business filing division AT 980 NINTH STREET 16TH FLOOR

    FRAUD - SPREAD THE WORD

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