Either will give you protection; but an attorney would be able to tell you the differences, if any.As for the comment about corporations are for big companies and big start up costs, BS. Both require set-up and filing fees with your state and both require yearly renewals (also with your state). Here in MA, there is a minimum income tax of $456 and an annual report of $125 for a sub-S corporation. The LLC pays a renewal fee of $500.One of the biggest differences is an LLC is not recognized as an entity by the IRS, so you elect how you are going to file the taxes. If it s a single member LLC, you can report the income on your personal return as a schedule C. If there are multiple members, you can file as a partnership or as a corporation. But once you elect the reporting method, you have to stick with it. In other words you can t file as a partnership one year and a corporation the next.Another difference is the way ownership percentages are allocated. In an LLC, you have more flexibility than a corporation. Say you have a partner but he s silent (doesn t work the business), you can allocate the income on the tax return.You should contact a good CPA and talk it over as to what would benefit you the most for taxes.
An LLC would be your best choice. Depending on what amount of income you expect, you may also be able to benefit by electing to be taxed as an s-corp. I work with clients every week on proper LLC formation. Let me know if you need assistance.
An LLC is is the best of both worlds. If the business goes down then you don t go down but you are in control of the business instead of a corporation where the stockholders and committees have control.
I d go LLC. It s the modern approach to incorporating and you re more likely to keep the business small.
LLC is good for small companies. A Corporation is a huge set up read News Corp, Banking Corp etc
your lawyer is the best resource for these types of questions
