BTJD attorneys have extensive expertise in corporate formations. We traditionally help clients form LLCs, S-Corps, and C-Corps and can help you consider which structure is best for you. In making that selection, some items to consider include—

LLCs (Limited Liability Companies)

  • Benefits
    • Pass through taxation
    • Limited liability for members
    • Ease and simplicity to administer
    • Able to issue different classes of stock
  • Disadvantages
    • Less attractive to an acquiring company
    • Subject to self-employment tax

S-Corps

  • Benefits
    • Pass through taxation (If elected)
    • Limited liability for shareholders
  • Disadvantages
    • Higher administration cost (More complicated from a legal and accounting standpoint)
    • Only can have one class of stock and up to 100 shareholders
    • Salary is subject to self-employment tax
    • IRS restrictions on stock transfers

C-Corps

  • Benefits
    • Able to issue different classes of stock
    • Limited liability for shareholders
    • Attractive to acquiring companies
  • Disadvantages
    • Subject to double taxation (Taxed at the company level and again if dividends are paid)
    • Higher administrative cost (More complicated from a legal and accounting standpoint)

Whether you are looking to form a company to later be acquired or a lifestyle business, our attorneys are committed to helping you select or transition into the best corporate structure to fit your goals.