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Single-member LLC vs Partnership
Vesone
subscriber Posts: 2
After reading this article on this website it's made me question whether or not it's a good idea to become a single-member llc.
Here's the article:
http://www.myllc.com/single-Member-LLC.aspx
She mentions giving a family member or friend a piece of your company just to register as an official 'partnership LLC'
The only thing holding me back from actually doing this is the fact that I'm building an internet based consulting/educational company. I feel like there isn't much I could be sued for but I could REALLY be wrong in that assumption.
Would it be worth giving a piece of my company to one of my parents to become a partnership LLC? I know the world is sue happy so I'm a little afraid that the LLC won't protect me as a single member LLC since I'll be considered a sole proprietor in the IRS.
I'm just confused, do you guys know which option would be better?
Thanks for your help.
Vesone Dean
Here's the article:
http://www.myllc.com/single-Member-LLC.aspx
She mentions giving a family member or friend a piece of your company just to register as an official 'partnership LLC'
The only thing holding me back from actually doing this is the fact that I'm building an internet based consulting/educational company. I feel like there isn't much I could be sued for but I could REALLY be wrong in that assumption.
Would it be worth giving a piece of my company to one of my parents to become a partnership LLC? I know the world is sue happy so I'm a little afraid that the LLC won't protect me as a single member LLC since I'll be considered a sole proprietor in the IRS.
I'm just confused, do you guys know which option would be better?
Thanks for your help.
Vesone Dean
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Comments
Thanks again
You’re considering starting a new business and you’ve narrowed it down a bit between partnership and corporation.
Now the big question that weighs on your mind:
Which is better when it comes to comparing partnership and corporation…Partnership vs Corporation?
LLC is a good option
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For federal income tax purposes, by default, a Single-member LLC is treated the same as a sole proprietor, and a Multi-member LLC is treated as a partnership. In either case, the LLC's profits and losses pass through to its owners. ... Other fees, such as franchise fees, that LLCs must pay, as well.
Hi there!
From a legal perspective an LLC is an LLC whether it's a single member or multiple member. The tax answer will depend on if you are a single member or have more than one owner. From a tax point of view, a single member LLC is by far the simplest structure since a partnership has its own separate tax filing and it can be difficult to unwind once created.