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Helpful Tools for Decision Making
Select your business type to see how Bizee can work for you.
What’s the Difference Between
an LLC and a Corporation?
Not sure if a corporation or an LLC is right for you? Read the comparison below to review the fundamental differences.
LLC
If you are taxed as a standard LLC (not taxed as an S Corp), you have to pay employment tax on your entire salary.
Informal and Easy to Maintain
LLCs are not required to hold meetings annually or maintain bylaws. Furthermore, ownership is expressed by the percentage each member owns, while corporation ownership is represented by shares of stock.
Most Versatile
The LLC is the most versatile of all entity types as members can elect to receive the same tax treatment as an S or C Corporation. The ease of management, limited liability, and ability to designate corporate tax treatment make the LLC our most favored entity type.
Pass-Through Tax Entity
Any profits or losses on the business will pass through directly to the member's personal tax return and are treated as personal income and taxed on an individual level.
Corporation
Plan to Raise Money From Investors
The stricter formalities give investors the knowledge they desire about how your company is run.
Plan to Go Public in the Future
If you are planning to raise capital or to take the company public in the future the corporation is structured for that purpose.
Subject to Double Taxation
The corporation itself pays taxes, and any dividends paid to the shareholders are treated as personal income and are subject to additional taxation at the individual level.
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