S-Corp
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- qoob
Anyone here form an S-Corp (rather than LLC) for freelance or design consultancy purposes?
How much work is it to manage? And are there many benefits compared to LLC?
- popfodders0
Tax payment differences in how things work out if you claim bankruptcy.
- qoob0
What I heard is that you can reduce payroll tax by paying yourself a salary out of the total revenue. As opposed to LLC where all revenue is taxable.
- formed0
Yes, my business is an s-corp
There is work to manage it. The advantage is that you can determine how much you make, which determines how much you pay in taxes (the 'leftover' profit stays in the company). Disadvantage is payroll taxes, filing all the forms, payments, etc.
My advice would be to stay as an LLC if it is just you and you aren't making a ton (think tax brackets). The income 'passes through' to you, so your business income is your income, making taxes very simple (and, fyi, your accountant will charge for both a personal filing and a business, s-corp, filing, whereas the LLC route it is only one filing).