It is important to know when is the right time to incorporate and when you reach that point which of the business structures to choose.
Please use this as general information, not as legal advice. It is provided for informational purposes only. If you are considering incorporation, we encourage you to work with a legally qualified professional in your jurisdiction.
The right time to incorporate is not always the time when you start selling. Sometimes, it’s worth keeping it simple, with no entity, no tax filings, no extra fees. The time to incorporate needs to be well considered and discussed with a lawyer who can help you take the best decision.
Some of the benefits of an LLC are (if you are an online business owner this is the better option for you):
It is very important for the LLC owner to know how to treat the LLC and keep its books separately from the personal books. It is important to treat your LLC as a corporation, so you can receive the same type of protection.
First, what is the difference between S and C Corporation? The answer is: Taxation. The S Corporation provides owners with a different way of being taxed compared to a C corporation.
For the online small business owners having a C Corporation is not a good option, because of the double taxation. However, if you are not a US Citizen / Resident and you want to form a Corporation, you have no choice but to use this type of business structure.
The two (2) main benefits of having an S Corporation are: (the best option if you are a US Citizen and want to use the tax advantages of it)
The disadvantages of the S-Corporation are:
The type of the business you choose depends solely on what your needs are and the vision you have for your business.
Every online business should incorporate at some point.
- Renata Valkova
If you want to talk more about incorporating in the USA then click the button below and sign up for a free consultation.
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