Meet Jessica,
Jessica is starting a business in NY selling shea butter and trying to decide whether to form a LLC or a S Corp. Here’s what she should know.
- Both an LLC and S Corp protect an owner’s personal assets from business liabilities and debts.
- Both an LLC and S Corp pay self-employment taxes and no corporate taxes. S Corp owners do have to take a reasonable salary which IS taxable.
- Unlike an LLC which can have any amount of members, S Corp can only have a max of 100 shareholder and they all must be US Citizens.
Though S Corp formation has more paperwork an LLC in NY has a publication requirement