Hello and welcome to JustAnswer. Please note: (A) This is general information and is not legal advice. No specific course of action is proposed herein, and no attorney-client relationship or privilege is formed by speaking to an expert on this site. By continuing, you confirm that you understand and agree to these terms; and (B) the site allows experts not to participate in phone calls and I may or may not be able to participate in this feature.No worries - allow me to explain what happened. While TX recognizes an LLC, IRS does not - it asks the LLC to classify itself either as C, S, or Partnership.C CORPPRO: More liability protection in some jurisdictions
; may deduct fringe benefits (group term life insurance, health and disability insurance, death benefits payments to $5,000, employee medical expenses not paid by insurance) from their taxes as a business
expense). Other tax "perks."CON: These face possibility of double taxation if corporate income is distributed to business owners as dividends. Tax on corporate income is paid first at the corporate level and again at the individual level on dividends.S CORPPRO: S corps are pass-through entities. No income tax is paid at the corporate level. CON: more paperwork, stock ownership restrictions, closer IRS scrutiny, less flexibility in writing off loss.PARTNERSHIPPRO: Businesses as partnerships do not have to pay income tax; each partner files the profits or losses of the business on his or her own personal income tax return. CON: Generally is much harder to run if the partners get into a disagreement, less liability protection.I hope this helps and clarifies. Gentle Reminder: Use the SEND or REPLY button to keep chatting, or please RATE when finished. You may always ask follow ups at no charge after rating. Kindly rate my answer as one of TOP THREE FACES/STARS and then SUBMIT, as this is how I get credit for my time with you. Rating my answer the bottom two faces/stars or failing to submit the rating does not give me credit and reflects poorly on me, even if my answer is correct. I work very hard to formulate an informative and honest answer for you; please reciprocate my good faith.