It is more than certain that there are more tax benefits of forming a Corporation rather than going on a Individual basis, i.e. at proprietary level.
So, I would strongly advice you to go ahead forming a corporation. Since a corporation is a separate legal entity, it pays taxes separate and apart from its owners (at least in the typical C corporation). Owners of a corporation only pay taxes on corporate profits paid to them in the form of salaries, bonuses, and dividends. The corporation pays taxes, at the corporate rate, on any profits.
A further corporation tax benefit is that corporations pay federal income tax at a rate lower than that of most individuals for the first $75,000 of their profits - 15% of the first $50,000 of profit and 25% of the next $25,000. Professional corporations are charged a flat 35% tax rate. All allowable corporate deductions are treated as business deductions, making the determination of adjusted gross income, which is so essential for individual taxpayers, of little relevance to the corporation. Corporate taxable income is computed simply by subtracting from gross income all allowable deductions and losses. Individuals, on the other hand, have to consider itemized deductions or the standard deduction.
You may also refer to http://www.webpronews.com/topnews/2004/05/05/tax-benefits-of-incorporating for having a brief idea of all the tax benefits of forming a corporation.
So, in a nutshell, you must consider operate in a corporate form rather than going on on individual proprietor basis.
I hope this helps...
I would suggest you to go for S Corp. This is given some tax benefits and you will be able to better understand if you refer http://www.themoneyalert.com/Corp-Entity-Table.html
No.. You cannot write off the entire down payment. You can only write off to the interest paid on the mortgage and this would be reported by your mortgage lender on form 1098.