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difference between LLC and incorporation
Hi-
Can anyone explain to me the advantages of going LLC vs. Inc?
Why would I choose one over the other? What are the advantages and disadvantages?
Thanks.
Aharon
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Aharon Rabinowitz
aharon(AT)yahoo(DOT)com
http://www.allbetsareoff.com
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Creative Cow Master Series DVD
particleIllusion Fusion Volume 1
available @ http://www.pIllusionFusion.com -
7 Replies
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My advice would be to seek out an attorney in your area on this.
There are the regulatory differences, the tax differences, the liability differences, and I’ve usually been told by my attorneys when similar questions come up that these differences tend to be weighted based on recent legal precedent.
There are the rules…then there is how it actually works. Only the pros can tell you how it actually works, because there are state-to-state differences as well as states have their own tax codes and insurance/liability laws.
…and yes I know this isn’t very helpful…but I do enjoy your tutorials!
🙂
TimK,
Kolb Productions,
Creative Cow Host,
Author/Trainer
http://www.focalpress.com
http://www.classondemand.net -
In Wisconsin, payments made to an LLC have to bee accounted for at the end of the year with a 1099. Sub-S Corporations have their own tax withholding and do not require a 1099 from the client. This is one of the biggest differences I can think of. some corporations don’t like generating and accounting for all those 1099’s and the Sub-S corp is a “cleaner” relationship from a tax standpoint.
Get the Book “Inc. Yourself” off of Amazon.com and it will explain everything…even has state to state laws…it is a great book.
Rich Rubasch
Tilt Media -
Thanks guys! That helps.
Oh, and Tim, I appreciate the compliment. Hopefully more coming soon.
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Aharon Rabinowitz
aharon(AT)yahoo(DOT)com
http://www.allbetsareoff.com
—————————————-
Creative Cow Master Series DVD
particleIllusion Fusion Volume 1
available @ http://www.pIllusionFusion.com -
Inc. Yourself: How to Profit by Setting up Your Own Corporation
by: Judith H. McQuownThis book walks you through the financial and logistical advantages and disadvantages of various types of incorporation in down to earth language.
You may still need a Lawyer, but you’ll at least know what they’re talking about…. actually the book gives you all you need to know.
Highly recommended.
John Hartney
werks.tv
Elgin, Illinois – Chicago area
847.608.1357 -
Thansk. Sorry it took so long to respond. i’ve been swamped.
Greatly appreciated!
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Aharon Rabinowitz
aharon(AT)yahoo(DOT)com
http://www.allbetsareoff.com
—————————————-
Creative Cow Master Series DVD
particleIllusion Fusion Volume 1
available @ http://www.pIllusionFusion.com -
an LLC is basically a device to allow sole proprietorships and partnerships to acquire liability protection without incorporating. The advantages of an LLC over a C or S corp. are basically for people who are intimidated by the incorporation process. The advantages of incorporation detailed in “Inc Yourself” and many other books are not avaialable to LLC’s (with the exception of the protection of personal assets). But don’t overrate that protection. Almost all creditors will require a personal guarantor before extending credit to a newly formed corporation. Courts may “lift the corporate veil” in cases where an individual attempts to take egregious advantage. Don’t think that incorporating will necessarily protect your personal assets if you don’t have liability insurance.
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That’s extremely helpful. Thanks for the info!
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Aharon Rabinowitz
aharon(AT)yahoo(DOT)com
http://www.allbetsareoff.com
—————————————-
Creative Cow Master Series DVD
particleIllusion Fusion Volume 1
available @ http://www.pIllusionFusion.com
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