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What are the Main Differences between an LLC and an S-Corp?

What Is a C-Corporation?

What Is an LLC?

What Is an S-Corp?

Which Type of Company Incorporation is Right for You?

 

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TopConsumerReviews.com provides unique articles that you won't find anywhere else on the internet. These articles are designed to help you make the most informed decisions possible.

Which Type of Company Incorporation is Right for You?

Maybe when you first started out, a partnership or sole proprietorship was ideal. Your business was small, your exposure to legal liability may have been low because most of your clients or customers came to you via referrals from friends and family. But an organization's growth can mean both opportunity --- and potential headaches.

Your firm having survived its infancy, it might now be time to branch out to doing business in other states. You might have more employees and wish to offer them benefits while taking advantage of a tax deduction. Offering benefits might even result in attracting better quality employees. You might even want to raise capital by means other than personal assets or business loans. For these and other reasons, incorporating your business can be a good choice.

Once you've decided that you want to incorporate, you still have at least one more question to answer: "Which type of company incorporation is right for you?"

As an owner, you have two types of corporate structure to choose from. The C-corporation is what most folks think of when they think of incorporating. A C-corporation must accomplish a list of administrative steps to establish and maintain its status, among them the filing of a number of IRS tax documents throughout the calendar year. An S-corporation must take the same set of administrative steps but does not have to file a corporate tax return. Instead, S-corp owners report any profits or losses on their personal tax returns.

With both C-corp and S-corp structures, you establish your company as a tax and legal entity separate from you and any other owners. Creating this entity acts to protect you from liability in the event that you are sued or your company goes into debt.

Whether you select S-corp or C-corp status, incorporating your business requires the completion of a good deal of documentation that must be filed according to somewhat strict procedures. To make things even more complicated, each state sets its own rules relative to incorporation procedures. Hiring a lawyer who is familiar with your state's rules, as well as with federal statutes and provisions, is advisable. Consulting with a business tax professional before starting the process is also a good idea.

To begin the incorporation process, you must file articles of incorporation with your state's Secretary of State. In addition, you have to craft and record a set of company by-laws. By-laws do not need to be filed with any official body, but must be kept with company files. Next, you have to schedule -- at least once per year -- shareholder and board of directors meetings. When meetings are held, minutes must be recorded and kept on file. Establishing a business name with state and/or local authorities, complying with licensing regulations and obtaining a federal tax ID number are also part of the process.

If you choose the S-Corp route, you need to be sure your company meets IRS requirements for "Subchapter S" status. These requirements are routinely updated, so checking in with a tax professional is encouraged. If you do indeed qualify, you must have your shareholders vote to approve S-corp status. Once you have established S-corp status, you'll be able to sidestep the liability concerns of a sole proprietorship or partnership, as well as the cumbersome tax filing requirements of a C-corporation.

Each incorporation choice boasts its own positives and negatives. When it comes to choosing between the two, your business objectives -- tempered with sound legal and tax advice -- should inform the process.

Woodlands board likely to select incorporation consulting firm this week

The Woodlands Township Board of Directors is moving forward with an evaluation of possible incorporation with board members likely selecting a consulting firm this week to help in the process. The township's Board of Directors is set to meet in a special ...

Published:  Fri, 19 Jan 2018 15:59:00 GMT



Research delivers insight into the building information modeling market

This research report analyzes the building information modeling market, with a focus on key firms in the industry such as Nemetschek, Autodesk, Inc., Bentley Systems Incorporation and Trimble Navigation Limited. Research By Markets adds "Global Building ...

Published:  Sun, 21 Jan 2018 10:28:00 GMT



Berlin incorporation informational meetings set

With the election less than one month away to decide if Berlin incorporates, two informational meetings have been set for early February. The meetings are set Feb. 1 and Feb. 6 at 6 p.m. at the Berlin Community Center. Patrick Bates and others involved in ...

Published:  Thu, 18 Jan 2018 07:43:00 GMT



SEC rescinds Rappler's incorporation papers

THE Securities and Exchange Commission (SEC) has revoked the incorporation papers of online news site Rappler, Inc. and its parent company for failing to meet the constitutional limits on foreign ownership, as investors closely monitor the ruling's ...

Published:  Mon, 15 Jan 2018 07:15:00 GMT



Incorporation of Ex-Combatants in Humanitarian Demining: Lessons from Colombia, Somaliland & Southern Somalia

As part of the peace effort between the Colombian government and the FARC, a pilot program was launched in 2015 allowing ex-combatants from the guerrilla to collaborate with Army soldiers in humanitarian demining-an urgent task given the country's ...

Published:  Thu, 18 Jan 2018 12:19:00 GMT



Dilip Buildcon rises 3pct on incorporation of subsidiary to explore mining activities

Money Control reported that shares of Dilip Buildcon added 3 percent intraday as it has incorporated a subsidiary to explore the mining activities. A new company has been incorporated named as DBL-VPR Mining for exploring sector of mining activities ...

Published:  Mon, 08 Jan 2018 23:19:00 GMT



CDL: Announcement on Incorporation of Subsidiaries

11:29a CDL: Scheduled date for release of the Unaudited Financial Results for the Year.. 01/12 MILLENNIUM PTHORNE HOTELS: CDL hires Georgeson to woo investors in M&C Hotels b.. 01/11 CDLHT: Completion of Divestment of Mercure Brisbane and Ibis Brisbane 01 ...

Published:  Tue, 16 Jan 2018 02:31:58 GMT



Town fires back at city in incorporation dispute

TOWN OF BELOIT - Town officials fired back at Beloit City Manager Lori Curtis Luther after she announced the city believes it no longer can pursue boundary agreement discussions. In a news release Wednesday, Town Administrator Ian Haas said Luther and the ...

Published:  Thu, 11 Jan 2018 13:00:00 GMT



Property mogul gets certificate of incorporation

SOUTH Africa-based property magnate, Timothy Mncube, who recently expressed interest to invest in Zimbabwe, has obtained a certificate of incorporation from the Registrar of Companies, as he steps up efforts to start operating locally. Mr Mncube - who ...

Published:  Mon, 15 Jan 2018 14:36:00 GMT



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