Thursday, December 30, 2010

Tips On Incorporating For A Small Business

What type of incorporation should a small company form .... LLC, C-Corp, or S-Corp?

Ask 10 people and you will get 11 opinions. Personally, and professionally, I lean towards the S Corp for a new company, even a one-person company. I believe the S Corp provides all the benefits and more, and provides for more flexibility, and less conversion complexity, as the entity grows and evolves.

Here is a tool that you may find helpful to assist you in making a decision. It takes into account financial information, taxes, risk factors, and benefit considerations (e.g., health care).

BizFilings Wizard

Also, here is link to a chart that illustrates the key attributes and distinctions among the various business forms.

Entity Comparison

Bear in mind that these are just tools and you should discuss your particular and family situation with your attorney, accountant, and financial advisor.

Disclaimer: The above is not legal advice and we do not have an attorney-client relationship. Also, per IRS Circular 230, the above is general information and is not intended to be used, and it cannot be used, for the purpose of avoiding federal tax penalties that may be imposed on the taxpayer.