topic Filing as a corporation in Self employed

Filing as a corporation

Vogue5296 — Tue, 12 Feb 2019 16:58:45 GMT

I own a small business that earns around 25000 per year. I am the only person in this business doing real estate and interior design. Does it make financial sense to file as a corporation or just as an LLC, sole proprietor or something else?

Thanks

Re: Filing as a corporation

HollyP — Wed, 13 Feb 2019 01:19:18 GMT

It's not a simple choice, and you should consult a local professional for assistance. In the meantime, you can review the IRS rules for Business Structures here.

Re: Filing as a corporation

Vogue5296 — Wed, 13 Feb 2019 01:32:54 GMT

Thanks, I have elected and been filing as a corporation, both S and C at different times for several years. I'm just not sure its worth the effort or expense anymore.

Re: Filing as a corporation

LudwigVan_fan — Fri, 29 Mar 2019 23:21:08 GMT

If you elected to file as a corporation, you can't change from year to year whether it's an S or a C. You have to stay with whatever one you elected. If you elected C Corp; you have to file Form 1120....until and if such time you file the necessary paperwork to elect S Corp status. If and when you do that, you have to file Form 1120S until the election is made to terminate S status. And there can be tax consequences to that. But you cannot go back and forth year to year.

Also, if you liquidate the corporation, there are tax consequences in the liquidation of a corporation.

Re: Filing as a corporation

Vogue5296 — Sat, 30 Mar 2019 00:29:59 GMT

OK, thanks. I'm going to talk to a tax pro to see what would work best for me. I appreciate your help.

Re: Filing as a corporation

Hi Palms — Sun, 07 Apr 2019 17:26:37 GMT

Get personal liability insurance no matter what you do. Those tax pros are okay for the tax stuff but don't know about the legal consequences when a person in business is negligent or gets sued for something done during a project.