What small business company should I choose, an LLC or S-Corp?

Question

I started my own Virtual Service Corporation. I work for a Work at Home company and needed to have my own Corporation. I chose to be an LLC. I am in Michigan. Is it better to be an LLC, or S-Corp? Is an S-Corp the same as an Inc? Please help. I am worried about what will happen at the end of the year come tax season.

Answer 1

It often is a good idea to incorporate your business for two basic reasons. First, you usually obtain some liability protection. With a corporation or LLC, business creditors may only be able to get repayment from the corporation. For example, if the corporation borrows $50,000 for some business purpose and then can’t repay the loan, the creditor may only be able to money from the corporation. If the corporation doesn’t have any money, the creditor won’t get repaid. And that might be true even if the shareholders who own and operate the corporation have money....

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