I currently have a doctors office with chiropractic and naturopathic doctors, that is an LLC
. For other legal reasons I am going to dissolve the LLC and form
two new businesses.
One will be the naturopathic business owned by the naturopathic doctor, and the higher grossing of the two, grossing $500,000 annually. The second will be the chiropractic business, owned by me, and grossing only $50-70.000.
I have more familiarity with LLC's, but am considering an S Corp for the smaller grossing chiropractic company. I am considering a C Corp for the higher grossing naturopatic company. I need some help with the advantages
/ disadvantages of the corps over an LLC.
1. Does the S corp file a return
like an LLC does?
2. The profit of the S Corp is passed on the owner/shareholder
(me), same as with an LLC?
3. Is the profit of the S Corp that gets passed to the owner considered dividends
and not subject to FICA/FUTA tax
? The profit of the LLC that is passed to the owner is not exempt
4. Do S Corps and LLC have similar business deduction
5. How would you characterize the advantages / disadvantages of the S Corp over the LLC for the lower grossing company"
6. For the higher grossing company I am considering a C corp. I understand that the C corp has double taxation
. The C Corp pays tax on their net income
/ profit. The owner/shareholder pays tax on any income
received from the C Corp. Is this the double taxation?
7. The C Corp has the advantage of income shifting. The taxes the C corp pays on its net income are not subject to FICA/FUTA? The salary to the owner/Shareholder is subject to FICA/FUTA. Is this how the combined taxes of the C Corp and the owner/shareholder may be less than the taxes paid by the member of an LLC that has the profit passed to them and pays FICA/FUTA on all of the income?
8. Is the ability to deduct business expenses
greater, more extensive for a C Corp than an LLC?
9. How would you characterize the advantages / disadvantages of a C Corp vs an LLC for the higher grossing company?