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Daval · 02-25-2004, 06:00 AM

I was about to post a similar type link as onetime2 did.

Whatever you do is basically based on the amount of personal risk you are willing to accept.

Going with a Sole Proprietorship will allow you much better tax advantages and at the end of the day you'll keep more of the profits for yourself. But if your business goes down - you will go down with it.

Going with a Corporation would certainly protect you if your business fails - but more of the money is gonna be going to Uncle Sam.

I would find myself a lawyer who specializes in setting up new companies (you'll need one anyways) and talk to them about your options and how much you're willing to expose yourself and your family.

personally I would go the route of the LLC

---------------

Limited Liability Company (LLC)

LLCs have long been a traditional form of business structure in Europe and Latin America. LLCs were first introduced in the United States by the state of Wyoming in 1977 and authorized for pass-through taxation (similar to partnerships and S Corporations) by the IRS in 1988. With the recent inclusion of Hawaii, all 50 states and Washington, D.C. have now adopted some form of LLC legislation for both domestic and foreign (out of state) limited liability companies.

Many business professionals believe LLCs present a superior alternative to corporations and partnerships because LLCs combine many of the advantages of both. With an LLC, the owners can have the corporate liability protection for their personal assets from business debt as well as the tax advantages of partnerships or S Corporations. It is similar to an S Corporation without the IRS' restrictions.

Advantages
Protection of personal assets from business debt
Profits/losses pass through to personal income tax returns of the owners
Great flexibility in management and organization of the business
LLCs do not have the ownership restrictions of S Corporations making them ideal business structures for foreign investors

Disadvantages
LLCs often have a limited life (not to exceed 30 years in many states)
Some states require at least 2 members to form an LLC, and
LLCs are not corporations and therefore do not have stock -- and the benefits of stock ownership and sales.

02-25-2004, 06:00 AM	#3 (permalink)
Daval Junkie Location: The True North Strong and Free!	I was about to post a similar type link as onetime2 did. Whatever you do is basically based on the amount of personal risk you are willing to accept. Going with a Sole Proprietorship will allow you much better tax advantages and at the end of the day you'll keep more of the profits for yourself. But if your business goes down - you will go down with it. Going with a Corporation would certainly protect you if your business fails - but more of the money is gonna be going to Uncle Sam. I would find myself a lawyer who specializes in setting up new companies (you'll need one anyways) and talk to them about your options and how much you're willing to expose yourself and your family. personally I would go the route of the LLC --------------- Limited Liability Company (LLC) LLCs have long been a traditional form of business structure in Europe and Latin America. LLCs were first introduced in the United States by the state of Wyoming in 1977 and authorized for pass-through taxation (similar to partnerships and S Corporations) by the IRS in 1988. With the recent inclusion of Hawaii, all 50 states and Washington, D.C. have now adopted some form of LLC legislation for both domestic and foreign (out of state) limited liability companies. Many business professionals believe LLCs present a superior alternative to corporations and partnerships because LLCs combine many of the advantages of both. With an LLC, the owners can have the corporate liability protection for their personal assets from business debt as well as the tax advantages of partnerships or S Corporations. It is similar to an S Corporation without the IRS' restrictions. Advantages Protection of personal assets from business debt Profits/losses pass through to personal income tax returns of the owners Great flexibility in management and organization of the business LLCs do not have the ownership restrictions of S Corporations making them ideal business structures for foreign investors Disadvantages LLCs often have a limited life (not to exceed 30 years in many states) Some states require at least 2 members to form an LLC, and LLCs are not corporations and therefore do not have stock -- and the benefits of stock ownership and sales. __________________ "It is impossible to obtain a conviction for sodomy from an English jury. Half of them don't believe that it can physically be done, and the other half are doing it." Winston Churchill Last edited by Daval; 02-25-2004 at 06:03 AM..