Re: difference between LLC and incorporation by Tim Kolb on Jan 8, 2006 at 6:29:18 am
My advice would be to seek out an attorney in your area on this.
There are the regulatory differences, the tax differences, the liability differences, and I've usually been told by my attorneys when similar questions come up that these differences tend to be weighted based on recent legal precedent.
There are the rules...then there is how it actually works. Only the pros can tell you how it actually works, because there are state-to-state differences as well as states have their own tax codes and insurance/liability laws.
...and yes I know this isn't very helpful...but I do enjoy your tutorials!
Re: difference between LLC and incorporation by Rich Rubasch on Jan 9, 2006 at 3:18:04 am
In Wisconsin, payments made to an LLC have to bee accounted for at the end of the year with a 1099. Sub-S Corporations have their own tax withholding and do not require a 1099 from the client. This is one of the biggest differences I can think of. some corporations don't like generating and accounting for all those 1099's and the Sub-S corp is a "cleaner" relationship from a tax standpoint.
Get the Book "Inc. Yourself" off of Amazon.com and it will explain everything...even has state to state laws...it is a great book.
Re: difference between LLC and incorporation by Peter Ralph on Jan 16, 2006 at 4:38:22 pm
an LLC is basically a device to allow sole proprietorships and partnerships to acquire liability protection without incorporating. The advantages of an LLC over a C or S corp. are basically for people who are intimidated by the incorporation process. The advantages of incorporation detailed in "Inc Yourself" and many other books are not avaialable to LLC's (with the exception of the protection of personal assets). But don't overrate that protection. Almost all creditors will require a personal guarantor before extending credit to a newly formed corporation. Courts may "lift the corporate veil" in cases where an individual attempts to take egregious advantage. Don't think that incorporating will necessarily protect your personal assets if you don't have liability insurance.
