If you're in US, what kind of business are you? (Only for those companies that make at LEAST a few thousand / month)

We're wondering if we should go LLC or not. Right now we're a partnership in the state of Tennessee.

Right now, we're a general partnership. We're a family-owned, 2 person company right now so we haven't felt the need for the jump to LLC yet. We trust each other well enough to know that one isn't going to do anything that could hurt or hender business unlike "disgruntled employee" situations, etc.

I think an LLC would be a good idea for any company that has multiple people. It gives you the added protection as its a seperate entity so your personal assets are protected. Theres more paperwork involved with it but it could be worth it in the long run.

Just my thoughts. :)

A general partnership is the worst possible business formation that you can have. There is no reason to ever set one up. I understand the "it won't happen to me" or "I don't need that" attitude, but the fact of the matter is you never never know when something unexpected can happen (hence, unexpected). A general partnership gives you no protection or tax benefits. You are also completely liable for the other person's mistakes and vice versa. It's not expensive and doesn't require that much maintenance at all to set yourself up as a LLC, LP, or even a S or C Corp. IMHO -- When operating any kind of business you should always set yourself up as one those.

We are a C corp.

I agree with kwes43's statement "A general partnership is the worst possible business formation that you can have."

We are currently a S-Corp for Liability and tax benefits (nothing like pass through income).

This US stuff confuses me :/

We're a Private Limited Company hence the Ltd/Limited at the end of our name..

alex

im a sole pro.

I own a couple businesses, from Sole Prop. to C-Corp.

There are multiple advantages of an LLC if you do not wish to go to a full Corporate structure. You can grab the liability insulation by going LLC and yet still retain many of the advantages of a partnership.

If you make more then 15K a year, an LLC structure is a smart way to go.

Sole LLC here

Class S Corp. - Works well if you are privately held.

- John C.

I got a question if your LLC do you get tax benefits too?

Would you recommend filing the papers yourself or going to a business like www.mycorporation.com to do it for you?

Originally posted by JohnCrowley
Class S Corp. - Works well if you are privately held.

- John C.

But then you get no fringe benefits...

I got a question if your LLC do you get tax benefits too?

You can set up an LLC to be taxed like a C-Corp (a seperate entity where the LLC will have its own corporate tax bracket) or you can set it up to pass through expenses to your personal income statement. This is entirely up to you and should be based upon your personal and business tax plan (may vary from state to state so check first). Many people like their deductions to pass through and offset their income (this can be great if you are a high-paid professional starting a part-time biz on the side). There is also advantages in the long run to having your company taxed as it's own entity, however, most of the benefits come from forming an actual a C-Corp and not an LLC taxed like a C-Corp. Some of the advantages I speak of are employee benefits including helath care and retirement plans, being able to purchase certain items with pre-taxed money, and various investment strategies (where the corp buys and owns investments for you).

Would you recommend filing the papers yourself or going to a business like www.mycorporation.com to do it for you?

The simple answer is: whichever you feel comfortable with. It is not that hard to file for yourself but, it can depend on how complex your entity and tax strategy is. If you are just one person filing as a single member LLC with pass through expenses than you should have no problem doing it yourself after a little bit of research. The more people involved and the more complex your strategy is, the more you willl benefit from seeking outside help.

We're an LLC, personally, I think it's the safest way to go. Then again, each licensing is different upon the business owners needs.

Originally posted by kwes43
But then you get no fringe benefits...

Depends on what "fringe benefits" you are referring to. Class S provides us with corporate protection, shares of stock, and a "nice" pass-thru profit to the shareholders each year. Sure, we can't go public, and we can't have the business retaining money per se, but who wants to be publically traded, filing more paperwork, and being double taxed just to have a "C" in our name? ;)

OK, it makes sense for some organizations, but not ours.

- John C.