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What type of entity is best for me?
rockdoctor
subscriber Posts: 2
I am planning to start up a company while continuing to work full-time. The reasons for starting up are:
1) To establish a business history for future credit
2) To build revenue that may be used for capital as the ulitmate plan for the business will require a relatively large capital investment.
I foresee this company operating for two to three years with minimal revenue, certainly less than could accomodate a reasonable salary for myself. I would be the only employee while the business is operating in "broke-mode". At some point, I would hope to quit my current job and quickly turn the business into a profitable venture with a handful of employees. As I perform a very specialized technical service with little competition, it will be easy for me to gauge when that profitable point occurs. I`m trying to figure out whether an S-Corp or LLC is the right way to go considering how I foresee this enterprise evovling. Does anyone have any advice on this matter?
1) To establish a business history for future credit
2) To build revenue that may be used for capital as the ulitmate plan for the business will require a relatively large capital investment.
I foresee this company operating for two to three years with minimal revenue, certainly less than could accomodate a reasonable salary for myself. I would be the only employee while the business is operating in "broke-mode". At some point, I would hope to quit my current job and quickly turn the business into a profitable venture with a handful of employees. As I perform a very specialized technical service with little competition, it will be easy for me to gauge when that profitable point occurs. I`m trying to figure out whether an S-Corp or LLC is the right way to go considering how I foresee this enterprise evovling. Does anyone have any advice on this matter?
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Comments
FWIW, you could easily start as an LLC (low startup costs, little paperwork, simple taxes), and when your situation changes, convert to an S-Corp, which is a somewhat more expensive and complicated entity.
Good luck!
i found this site that would really help you, Its about LLC vs. S Corp: Which Structure is right for your Business.. here hope it helps!!
goodluck!
Check out http://www.centerpointcorporate.com/ They do business formations in Nevada. I`m not sure where you`re from but Nevada`s a really good state to form in because the annual requirements and things like that are pretty inexpensive. Give them a call or an email and they can help you out with which is better an LLC or Corp. I formed an S-corp through them in Nevada even though I live in California because it`s much cheaper.