Which is Better, an S-Corp or an LLC?
That’s kind of a trick question. The lawyer answer is it depends. Honestly, each individual situation is different. That’s what the value of a business lawyer is, is being able to come to them and find out what works. There’s really three big considerations when deciding whether you want an S-Corporation or an LLC. The first, obviously, is tax considerations. I think most people think about taxes all the time. What works is reducing your taxes as much as possible.
The other two that people don’t really think about – the first is liability protection. How does an LLC protect me versus an S-Corporation? They are different. The second is management. The operating structure of an LLC is completely different than operating structure in an S-Corporation. To a certain extent, you can kind of make, you know, you’ve got to go back and forth to make some more restrictive and less, but that’s a conversation you really should be having with your attorney, is what is the best for me? By coming to me, not only am I a business attorney, I’m actually a CPA. I can talk over both the tax, the management, and the liability protections of an LLC or S-Corporation. So, to wrap right back around, it depends, but I can help you find the right one.