What type of company?

[commonsense]

I am beginning to make money offline...enough money that I am thinking about creating a company to protect myself and hopefully deal with taxes easier.

What would be best for me? An S-Corp? LLC?

I am in California. I don't sell any products if that matters.

Thanks,

Brandon

I would recommend that you discuss your specific business with an accountant for a better understanding of how each type of entity would serve you best.

[! Hulio !]

Hi Brandon,

I wish it were that easy to answer the question of forming an S corp or LLC, but everyone's case is different.

Both entities will give you limited liability protection. LLCs are easier to manage overall because they aren't bound by the same formalities as corporations (and an S corp is just a corporation that elects S corp--pass-thru--tax status), and there's slightly less paperwork to deal with at tax time for a single-member LLC. Also, as the owner of an LLC, you wouldn't have to deal with payroll administration since you would be considered self-employed (vs. being an employee, as the owner-officer of an S corp).

It probably sounds like I'm pushing for the LLC, but you may find that an S corp would suit you better, and it might be worth the additional paperwork if it turns out that it could save you $$$ in taxes. And it is possible to save on employment tax with an S corp because only the salary paid out of an S corp is subject to employment tax. Distributions are not.

Set an appointment for a consultation w/ a CPA and get his/her opinion based on your circumstances. Until then, you can read S Corp vs. LLC: Which Structure is Right for Your Business for a pragmatic comparison of the two entities.

[commonsense]

Thanks for the link angelica.

Are the more details I can give that would help advise the situation more? I don't mind giving out most of the details if it would help.

Thanks again,

Brandon

[! Hulio !]

More details, yes . . . but not for me, for a CPA who is qualified to review your situation in its entirety and give you qualified tax advice. There are so many CPAs out there that offer free consultations, it's well worth your time to take advantage of the opportunity and sit down for a one-on-one with one of them.