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10/20/2017 1:01:18 AM
9/22/2017 12:11:25 AM
Posted: 9/7/2005 11:27:24 AM EDT
I am going to go into business for myself but with a spin. I am going to go to work for my father, taking over his construction company. I will basically be taking a crash course in his construction business that he has owned and operated for the past 25 years. So, I will be incorporating under a new name, taking my father on as a parter. This will allow me to create credit with my new corporation as was suggested by our banker. The main reason, we are creating a new corporation is so that once I learn as much as I can, I will branch off and begin another subsection of the business at a different location, but will be utilizing the same general name of the business with a slight variation.

My question is, which route of incorporation would work the best for me? Since it will be a partnership starting off, me and my father, I was looking at a LLP. I understand that LLC's and INC's main difference is income or loss is "passed through" to the owners of the company, but what is the benifit of this. Is it better to be taxed on income at the INC level or have it passed through to the owners personal level?

Any feedback would be highly appreicated.

Nick
Link Posted: 9/7/2005 6:32:17 PM EDT
A single level of taxation is usually the best way to go but there are many other issues like control of the cash distributions; having a buy/sell agreement; right of first refusal on sale of stock to a 3rd party; multi-state tax issues; board managed company vs. member or manager managed LLC; trade name of the company.

Too many questions to answer on the 'net; get a good business lawyer you trust & the advice will be worth the expense.
Link Posted: 9/8/2005 6:00:36 PM EDT

Originally Posted By KC_MO_shooter:
A single level of taxation is usually the best way to go but there are many other issues like control of the cash distributions; having a buy/sell agreement; right of first refusal on sale of stock to a 3rd party; multi-state tax issues; board managed company vs. member or manager managed LLC; trade name of the company.

Too many questions to answer on the 'net; get a good business lawyer you trust & the advice will be worth the expense.



Thanks for the input, I will do just that!
Link Posted: 9/8/2005 9:23:38 PM EDT
An S-Corp will protect you and your personal assets from the companys liabilities
Link Posted: 9/14/2005 11:50:13 AM EDT
[Last Edit: 9/14/2005 11:56:52 AM EDT by TacticalMan]
Almost to a man, accountants, business brokers and lawyers have been telling me that the way to go these days is with a "C" corporation.

The income tax implications are outweighed by the other benefits provided by the C corp. Supposedly there are enough deductions with a C corp so that they never have to show a profit and hence, be doubly taxed.

ETA: I just Googled that and came up with a very interesting page on just this subject.
S v. C Corp

I'm going to have to bookmark that one!
Link Posted: 9/14/2005 5:58:42 PM EDT
Nolo Press also makes a good book about this.

We have an LLC for a small side business. We chose it over a C because C, with its numerous paperwork rules, just doesn't make sense for our small, break-even business.
Link Posted: 9/15/2005 5:36:22 PM EDT

Originally Posted By TacticalMan:
Almost to a man, accountants, business brokers and lawyers have been telling me that the way to go these days is with a "C" corporation.

The income tax implications are outweighed by the other benefits provided by the C corp. Supposedly there are enough deductions with a C corp so that they never have to show a profit and hence, be doubly taxed.

ETA: I just Googled that and came up with a very interesting page on just this subject.
S v. C Corp

I'm going to have to bookmark that one!



Very good link with some useful info. Thanks!
Link Posted: 9/18/2005 7:10:50 PM EDT

Originally Posted By Hartmann:
Nolo Press also makes a good book about this.

We have an LLC for a small side business. We chose it over a C because C, with its numerous paperwork rules, just doesn't make sense for our small, break-even business.



The paperwork difference really is negligible.
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