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    6 Replies Latest reply on Apr 28, 2008 4:49 PM by nytaxguy

    Which one is better? LLc or S Corp

    olas01 Newbie


      I just started my own business, like 4 months ago, and i get for S corp form; 2 days ago i received one letter from maryland tax that mean i have to do my return tax, how can i do because i did't sell too much? i make too much expenses for open that business i use my money, do you think i can put this expenses when i do the business tax return? yes or no? if no why? so what can do if i want do the tax return? remember i use my money for started that business! do you think i can lose my money? because i can do the tax return together with my business.

      Somebody told me i have to switch for LLC, and now i can put all expenses i do it for open that business!

      I need some help please, thanks you for your response
        • Re: Which one is better? LLc or S Corp
          LUCKIEST Guide
          01. It is the American way. Anybody who is in business must file some kind of Tax Return.
          You received a letter from the State. You usually have to file a FEDERAL tax return with the I R S first.
          It makes difference an LLC or S Corp, you will have to file RETURNS . Makes no difference if you make money
          (profit) or have a loss, the returns MUST be filed. Go see an accountant.
          • Re: Which one is better? LLc or S Corp
            DomainDiva Ranger
            Stop listening to amateurs. Get an accountant. You have to file a tax return regardless of the corporation status yuo have elected.
            • Re: Which one is better? LLc or S Corp
              LRushforth Newbie

              You really need to ask two questions. First: "Which is the best entity for legal reasons?" This will usually depend on the optimal protection for the business and for company's owners under state law. Second: "Which is the best entity for tax purposes?" This will depend on state and federal tax law and how those law apply to the company's financial situation.



              For many folks, the answer is to form an LLC that elects to be taxed as an S corporation. In other words, a business can be an LLC under state law that the IRS treats as an S corporation for federal tax purposes. Under federal tax law, there is no tax law that applies to an LLC specifically. An LLC is taxed as one of the following: (1) a sole proprietorship (if it has only one member); (2) a corporation under Subchapter C (normal corporate taxation); (3) a corporation under Subchapter S; (4) or, as a partnership (if it has two or more members). The legal question should be answered by an attorney familiar with your business and applicable state law, and the tax questions hould be answered by an accountant that is familiar with your business and applicable tax law, both state and federal.