[AZ86]

Which did you choose, and why? Pros? Cons?

I chose S Corp because of the fact that I think companies shy away from using an LLC company.

 

[Edrick]

Which did you choose, and why? Pros? Cons? I chose S Corp because of the fact that I think companies shy away from using an LLC company.

Why do you think companies shy away from LLC over SCorp? Even with SCorp they have to 1099 you

 

[AZ86]

Why do you think companies shy away from LLC over SCorp? Even with SCorp they have to 1099 you

I think just having the LLC on the end as opposed to INC? I took advice from a lawyer friend.

 

[rewire]

we a LLC but elect to be taxed as an S-corp

 

[bml215]

Government has been targeting s corp's recently (past 2 years or something). Even if you are squeaky clean, having to go through audits could be time consuming, and frustrating.

 

[Edrick]

I think just having the LLC on the end as opposed to INC? I took advice from a lawyer friend.

I don't see why LLC vs INC would cause any real business to think differently of you.

 

[robnj772]

I think just having the LLC on the end as opposed to INC? I took advice from a lawyer friend.

Do you know how many large companies are llc's ?

Mars candy
Dunkin donuts
Gmac
Chrysler
Toys r us
Harrahs
Enterprise

 

[rewire]

Government has been targeting s corp's recently (past 2 years or something). Even if you are squeaky clean, having to go through audits could be time consuming, and frustrating.

LLCs have come under scrutiny over the last few years according to our accountant. As part of his fee we get unlimited time from him if audited. We have used him for twenty years so he has all our past tax forms on his computer.

 

[bml215]

LLCs have come under scrutiny over the last few years according to our accountant. As part of his fee we get unlimited time from him if audited. We have used him for twenty years so he has all our past tax forms on his computer.

Hmm good to know. The report I was reading didn't mention that; only s corps.

 

[drspec]

LLCs have come under scrutiny over the last few years according to our accountant. As part of his fee we get unlimited time from him if audited. We have used him for twenty years so he has all our past tax forms on his computer.

LLCs filing as s-corps......and generally those that aren't paying themselves a salary and paying with holding taxes

and yet the IRS still cannot define reasonable compensation

 

[bml215]

and yet the IRS still cannot define reasonable compensation

I recall reading something about it's got to be at least 60-40. The article mentioned a lot of doctors were paying them 20% pay and passing the other 80 through in profits to themselves.

 

[hardworkingstiff]

Why do you think companies shy away from LLC over SCorp? Even with SCorp they have to 1099 you

I don't believe that is true. I believe the IRS says you don't have to 1099 a corporation.

Exceptions. Some payments do not have to be reported on
Form 1099-MISC, although they may be taxable to the
recipient. Payments for which a Form 1099-MISC is not
required include all of the following.
Generally, payments to a corporation. But see Reportable
payments to corporations, later.

.......

Payments to corporations for legal services. The
exemption from reporting payments made to corporations
does not apply to payments for legal services. Therefore, you
must report attorneys' fees (in box 7) or gross proceeds (in
box 14) as described earlier to corporations that provide legal
services.

http://www.irs.gov/pub/irs-pdf/i1099msc.pdf

 

[robnj772]

Why do you think companies shy away from LLC over SCorp? Even with SCorp they have to 1099 you

Even if they 1099 you if your legit you are paying the tax anyway.

 

[rewire]

LLCs filing as s-corps......and generally those that aren't paying themselves a salary and paying with holding taxes

and yet the IRS still cannot define reasonable compensation

that defeats the purpose of filing taxes as an S-corp the whole purpose is so you can draw a salary and pay with holding.