Should You Incorporate Your Business as an LLC for Tax Breaks?

StartupNation

Should You Incorporate Your Business as an LLC for Tax Breaks?

We break down how the IRS initially taxes an LLC and a shortlist of items to tackle once you’ve decided to incorporate as an LLC.

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FastIncNow

The simplest and least expensive way to launch a new business is as a sole proprietor. This choice requires little or no legal expense, no complex tax structure and no one else to interfere with management decisions. As a sole proprietor, profits flow directly through your personal tax return, using a separate tax form called Schedule C, Profit or Loss from a Business. You get to keep or reinvest all of the after-tax income produced by your business. If it ever becomes necessary to do so, a sole proprietorship is the easiest of all business structures to dissolve.

Blazho Gjorgiev

FastIncNow is all depends what are the goals you are aiming.

saravanan

Both LLCs and S-corps have tax advantages so it all depends on your circumstances.

If you will have substantial income subject to self-employment taxes the s-corp might be a better vehicle.

If you will have losses and using borrowed debt then a LLC might be a better option.