Since either a C-Corp or a LLC can apply for S-Corp filing with the IRS for its pass-thru taxing, their difference reduces down to filing fees and organizational compliances. C-Corps since they can be publicly traded require quarterly recorded and reported shareholder meeting minutes. This is not requireed with LLCs. Both share in a similar degree of liability protection. With a LLC, insurance offered to employeees has to be uniform to all including officers. As far as I can see filing in California as a foreign (out of state) LLC cost $70.00 for the Articles of Organization (http://www.sos.ca.gov/business/bpd_forms.htm#llc).
All of my experience with lawyers has been expensive ($250+/hour), open-ended and without certainity in outcome. The best way to use them is to review drafts of agreements that you can get from online services such as Nolo.com. This activity is bounded and precise. Always get an estimate before any effort and question all surprises. Dan Simpson wrote: > Yes, there are corporate taxes and income taxes. One of the benefits > of a NV corp is state tax or filing relief for the corporation itself: > http://en.wikipedia.org/wiki/Nevada_corporation > > There are some costs associated with a NV corp, but some benefits may > interest you. > > --Dan > > On Wed, Jun 17, 2009 at 2:05 PM, Matt Aimonetti > <[email protected] <mailto:[email protected]>> wrote: > > Your taxes will not depend on what state your LLC or S-Corp is in, > since both are "pass-through" vehicles, and just hand the income > to you to pay taxes on. Shopping among states for better tax > treatment is for larger corporations. > > I don't believe that's exactly correct when it comes to an S-Corp. > I don't deal with that part of our business, so don't quote me on > that, but when I filed my personal tax, I only paid income tax on > my income. (what I gave myself as a salary) The rest is dealt at > the business level. > > - Matt > > > > On Wed, Jun 17, 2009 at 1:51 PM, Scott Olmsted <[email protected] > <mailto:[email protected]>> wrote: > > At 01:19 PM 6/17/2009, you wrote: >> A couple thoughts related to 1 & 4: >> >> You can still maintain full control with the LLC, but you >> gain all the benefits of being incorporated. If you are >> thinking about getting a lawyer involved, that means you are >> trying to protect yourself. With the LLC, you mitigate >> personal risk associated with the business. >> >> You should look at setting up shop in Nevada. Just get a PO >> box in LV. > > Having a Nevada presence requires more than a PO Box, but > there are companies that will supply what you might want for > relatively little. > > On the other hand, I don't see any advantage. To do business > in California, you still have to register your Nevada LLC here > and pay the $800 annual corporate fee. Might as well just set > up a California LLC. It's very standard these days. I set up > one of the first LLC's in California about 1994 and I had to > educate banks, county personnel, city clerks, just about > everyone about just what this LLC thing was. You can get > create the paperwork you need from books (see Nolo.com), or > even from what you find online. > > An alternative is an S-Corp, there are pros and cons you can > find online. I think the S-Corp pays lower fees when the gross > gets big enough ($250,000/yr? $500,000/yr?). I like LLC's > because it's so easy to do it all yourself, though > follow-through with all the steps is important. > > Your taxes will not depend on what state your LLC or S-Corp is > in, since both are "pass-through" vehicles, and just hand the > income to you to pay taxes on. Shopping among states for > better tax treatment is for larger corporations. > > If you do your books in Quickbooks and your taxes in Turbotax > for Business, you might never need an accountant, just a > bookkeeper, perhaps. But get tax advice if you think you need it. > > The LLC may give you a little more clout than being a sole > proprietor, but no one should fool themselves into thinking it > represents any sort of real protection. If someone wants to > sue you, they'll sue your LLC or corporation and name you > personally in the suit as well. Your attorney can argue to > have you taken off if you've done things correctly, maintained > separate books, not mingled personal funds or expenses in > there, kept up with what you owe the state, etc, but being > sued will still cost you, win or lose. > > You may want to read up on trademarks at Nolo.com . > > Keep asking questions and doing your own research. Asking > lawyers is a very expensive way to learn and letting them do > work you can do is even more expensive. Make what seems the > best detailed plan you can, including writing your own > contracts, and then run it all by an attorney in an hour or > two and let him tell you where it needs fixing. That will keep > you out of trouble and save you a bundle. That's how attorneys > are best used, to keep you out of trouble in the first place, > and that shouldn't cost very much if you prepare. > > Scott > > P.S. +1 on avoiding employees. You can get almost anything > done by a contractor. Just follow the rules that keep > contractors from being classified as employees. But if you > have something where someone has to show up every day for at > least a few hours, you may find hiring an employee cheaper. > Just plan on them quitting at the worst possible time. > > >> Try to avoid employees as long as possible, then you can >> avoid accountants. You should be able to find consultants >> that charge a bit more, but it's a good thing for you. >> >> -- >> >> 2 & 3 >> >> Not sure about the trademarks... What's insurance? Be risk >> adverse. >> >> --Dan >> >> On Wed, Jun 17, 2009 at 1:07 PM, Erik Pukinskis >> <[email protected] <mailto:[email protected]>> wrote: >> >> Hey friends, >> I am starting a little web business, and since I've started >> interacting with customers it's time for me to legally >> get off the >> ground. Unfortunately, I don't have any expertise with >> this, beyond >> what I've learned from teh internets, and I could use >> some help. >> First, can anyone recommend a good, affordable, web-savvy >> San Diego >> small business lawyer? And an accountant? >> Otherwise, does anyone know anything about these things.... >> 1) Should I file for my permits in CA or in somewhere >> with nicer tax >> laws, like Delaware? If I and my employees are working >> from San >> Diego, does that just mean I have to register as a >> business here? >> With city, county, etc? >> 2) What international trademark classes do people use for >> the >> trademarks for web business? My site is providing >> instructional >> materials, but I'm also mailing people products and >> printed guides. >> I'll be building an iPhone app too. Should I just drop >> $1200 and >> cover all my bases, or can I get by with a trademark >> under one $300 >> class? >> 3) What do people recommend for business insurance? And >> where do you get it? >> 4) I'm leaning towards a Sole Proprietorship, since I >> want to maintain >> full control and I think the liability will be minimal. >> Has anyone >> done this? Are there any pitfalls? Should I look more >> closely at an >> LLC? >> It seems like I'm definitely going to need a lawyer soon >> enough, but >> maybe I can get by for a while without it. I'm >> supporting the >> business out of pocket and am trying to keep expenses to >> a minimum. >> Love, >> Erik >> >> >> >> >> > > > > > > > > --~--~---------~--~----~------------~-------~--~----~ SD Ruby mailing list [email protected] http://groups.google.com/group/sdruby -~----------~----~----~----~------~----~------~--~---
