S-Corp or LLC

MVP

Hello to all,
I would like to get some advice on whether to go s-corp or llc, as I have gotten 3 different answers from 3 different accountants/attorneys.
I am starting a Property & Casualty Insurance Agency on 11/1. The main carrier that appointed me will be giving me an interest free loan for $60,000...basically $5,000 a month for living expenses. I will be on an accelerated commission plan, whereby the 1st year I will be at 25%, 2nd year 20%, and the 3rd year 15%.
Whatever policies I sell the first year, the earned premium will go back to payback the loan amount.  The 2nd year I will get no money, but the policies that I sell will be my income plus all the renewals. I will not have to pay anything back in the 2nd year, as this is waived. In the 3rd year, I have to pay back the balance of the loan.
Since it`s going to take some time to build up the book of business, I do not anticipate me making a lot of $$ the first year. Hopefully in the 2nd year things will begin to pickup and the 3rd year as well.
I underestand the LLC is a little simpler to setup, but I was more concerned about the employement taxes I would be paying vs the S-corp and if I would end up paying more taxes this way vs going as an S-corp.
I was also told that I could start-up as an llc then go to an S-Corp.
Each accountant has their own variation.
I thought I would throw this out to see what others think and maybe get some good feedback to talk to the accountant about. I`m looking to make the best decision.
Confused???
Mike
 
 
 

MVP

First of all, thank you so much for your quick reply.  I really appreciate it!Ok, future plans:1) My hope is to bring a Customer service rep after the 1st year, or possibly sooner. My mother-in-law will be working for me when I start, inputting information and handling admin. She will be working part-time, around 20 hrs a week from her home in our development. As the business grows, I will add on another person, hopefully in year 2. I have a home office setup with all my furniture and necessary equipment. I will also have a Virtual office assistant setup at Office Suites Plus for $254.00 a month, where they will answer the phones for me from 8:30 am- 5:30 pm, transfer calls to me, and send e-mails.  I will have use of their conference room/backup office when necessary to meet clients. I may even have my wife join me between years1-2, based on how the business is doing, but right now I need her salary and benefits, as she has the major medical,dental,etc.2) At this point I don`t know if I will have any investors, because my main carrier will not let me add on similiar type carriers, until the 3 years is up. Unless, I pay back the loan earlier. To really grow my book of business I will need to get more carriers for more market share. A good friend of mine had suggested that he would like to build a building and have me get involved when the timing is right. He is a business owner, but invests a lot in real estate.3) I would think by the 3rd year of business, I would be generating 50k in net profits, but I`m still not sure. I am focusing very strong on good marketing campaigns. Of course only time will tell, but with the projections on the business plan, I should have at least $250,000 in written premium + all the renewals.4) Benefits are very important to me and I would also like to provide good benefits to the new people that come on board, due to if I don`t, the probably will go to the competition and get them anyhow. I believe in taking care of your employees and engaging them in a positive culture.I hope this clarifies some of my information.I look forward to your reply.Thanks again.Mike