I want to start a three man plumbing company. Should I form a corporation or an LLC?
Answer
There is absolutely no way to begin to guess from your post. In fact other forms of business organization ALSO need consideration. No one should every start a business until he has hired three key experts:
1. Your CPA - 2ho will decide the tax ramifications of various business structures
2. Your insurance agent who will get you proper coverages
3. Your lawyer - who will decide what business format is best for your plans, growth and liability.
The fact that you are posting here says you are trying to skip these steps. Over half of all new businesses fail, and the failure to do the above three steps is a huge factor in that.
Answer
I agree completely with Mr. Ashman. However, I will say that most likely an LLC will make the most sense because of its flexibility on how it is run and taxed. An LLC may be taxed as a partnership or a Subchapter S corporation (or a C corporation, but you wouldn't want that).
www.macgregorlyon.com
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