A Limited Liability Company (LLC) blends the aspects of corporations, partnerships and sole proprietorships into a simple and flexible business entity. LLCs offer the same personal liability protection as corporations with few corporate formalities. LLC entities can be used to hold property and transact any type of business. They protect the owners and operators from personal liability similar to a corporation, and they possess the "pass-through" tax benefits of a partnership. Additionally, LLCs do not require the typical formalities that are required when managing a corporation.
A corporation is a legal entity created separately from those who own and operate it. As a separate entity, the corporation's debts and taxes are separate from its owners (shareholders), thereby offering the greatest personal liability protection of all business structure. Corporations also offer tax savings and the ability to raise capital under your business name.
S Corporation is a tax designation used to dictate how your business is taxed by the IRS. New corporations, as well as LLCs considering corporate taxation can choose between filing taxes as a C corporation (C-Corp) or an S Corporation (S Corp). An S Corp is considered a pass-through entity, which means the business itself isn't taxed. Instead, income is reported on the owners' personal tax returns. Businesses taxed as C Corporations are not pass through entities. Income is taxed at the corporate level, and, if dividends are distributed, at the individual level as well. By choosing a Corporation or LLC with Inc Authority, you are able to select an S Corporation as your tax filing status. You have 75 days after formation to file this designation with the IRS.