I disagree as well. LLCs are not the same as C-Corps. Your point about tax benefit of LLC vs C-Corp is incorrect as well. The IRS does make a distinction. As I described earlier, S-Corps and LLCs are flow-thru entities. You do not pay a corporate income tax. Instead the tax is paid at the individual level only. As for the state of Texas. An LLC is subject to Corporate Franchise Tax as you alluded.
Again, my advice is to consult with tax/legal professionals if you really want to know the best entity to choose for your situation. The tax code is vast and complex and it changes each and every year. Don't just rely on information you read in the group threads. Some of it, though written with good intentions, is just plain inaccurate. kah On Sat, Aug 22, 2009 at 3:29 PM, Terry Brown <[email protected]>wrote: > > Well, except that last part - advice of the SBDC. > > Sent from my iPhone > > On Aug 22, 2009, at 3:07 PM, ferodynamics <[email protected]> wrote: > > > > > The LLC is the more modern form of the corporation. > > > > I think one big difference with LLCs, they don't have shares of > > stock. If you read about corporate shares of stock you'll see there > > are so many potential problems, I personally wouldn't touch that with > > a 10-foot pole. > > > > The IRS doesn't care if you're an LLC or a Corporation, they see no > > distinction, so no advantage one way or the other--just one big > > disadvantage for LLCs and corps: more paperwork. The "s-corp" is an > > IRS-specific term that has nothing to do with filing your articles of > > incorporation, in other words: more paperwork and probably more > > scrutiny if there's really a tax savings. > > > > I don't think there is much tax benefit to forming an LLC unless you > > figure out all the "corporate lunch" loopholes that probably don't > > apply to a small business anyway, good luck with that. As an LLC you > > end up paying a higher "business rate" for everything, plus there is a > > business tax you're going to pay to Texas every year, I forget the > > name of it now--ask your accountant :-) > > > > As far as liability protection, this is a myth, just look up the > > lawsuits yourself. If you're a small business, it's obvious to the > > court who is at fault: you! I believe you only get liability > > protection with a large business where it is not as clear who is > > liable, but even then, good luck! > > > > I'm not a lawyer but I did just finish a business law class and spent > > a fair amount of time on the IRS website, Secretary of State website, > > reading books, etc. So my advice: as long as your business is small, > > stay a Sole Proprietor and stay out of trouble and pay the self- > > employment tax with a smile on your face. Texas State has a Small > > Business Development Center and their advice is probably better than > > mine, they have offices in Austin and RR - > http://www.business.txstate.edu/sbdc/ > > > > > > > -- Keith Aric Hall http://www.keitharichall.com/ twitter: keitharichall --~--~---------~--~----~------------~-------~--~----~ Our Web site: http://www.RefreshAustin.org/ You received this message because you are subscribed to the Google Groups "Refresh Austin" group. [ Posting ] To post to this group, send email to [email protected] Job-related postings should follow http://tr.im/refreshaustinjobspolicy We do not accept job posts from recruiters. [ Unsubscribe ] To unsubscribe from this group, send email to [email protected] [ More Info ] For more options, visit this group at http://groups.google.com/group/Refresh-Austin -~----------~----~----~----~------~----~------~--~---
