hi, I can help with this
Just means that you started out as an LLC and then did an election to be taxed as a c-Corp
if it's in the C-Corp as retained earnings it's not taxed as a pass through (as the default LLC would be)
that the diff ...
In LLCs that haven't mad an election to be taxed differently, partnerships and S-Corps the profit is passed through and taxed no matter what, even if you don't physically distribute it
In a C-corp, you decide after you've made a profit, whether you want to book it to retained earnings o pay it out as a dividend
so there is absolutely no difference financially between LLC taxed as a C corp and a traditional Corp? How about legally?
onlt then, as a dividend, is it taxed (with C-Corp)
I understand that the LLC taxed as Corp had better management options... that is why I am asking
An LLC, is much more flexible, You can do almost anything you want, as long s it's in the operating agreement
BUT, once you elect to betaxed as a C Corp, the C-Corp tax rules apply, the C-Corp now has its own tax return and pays taxes at Corporate rates
And of curse theres the double taxation issue
that is on profit
it becomes a taxable entity
does the state corp tax apply if I do not live or do business in that state (wisconsin)
c-copr pays its own taxes, then when you distribute that as dividends, you as the shareholder, pay tax personally
the state of incorporation for the C-corp is where the C-Corp pays its taxes
its state taxes
ok... cool. Thanks very much. Now I just need to decide if its worth staying in Wisconsin or moving the Business to Wyoming
Just a sec, let me show you something
Finally, this one's geared for retirement, but has some useful information for comparing back and forth:
ok... great. I will check it out. I was initially thinking Nevada but I kept seeing mention of Wyoming.
Yes Nevada and Wyoming both no State income taxa
I am looking to keep my profits in the business while keeping my income low... reinvesting the profits into growth
Also in Wyoming, Wyoming is a “fractional assessment” state. This means their property tax applies to only a fraction of the full market value of property.
C Corp's the way to do THAT
C Corps also allow for more fringe benefits
cool... I am definately subscrbing to this service :)
Thanks so much, Jason
I've been working with business owners for over 25 years.
Quick additional tip (might be stating the obvious) Make use of a SEPP or solo 401(k) ... every dollar is a deduction, but you keep it for your retirement!
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