If I begin working as an Independent Contractor, receiving a 1099, do I need to set-up an LLP to take advantages of tax breaks? Is there an advantage for doing so?

[Anonymous_]

"do I need to set-up an LLP to take advantages of tax breaks?"

I suspect you meant to type "LLC" (an LLP is a limited liability partnership).

Regardless, there is really no tax advantage to a single-member LLC as opposed to a sole proprietorship since an LLC is a disregarded entity for federal income tax purposes.

[BMcCalpin]

Depending on what state you live in, there may be other considerations on whether you should act as a sole proprietorship versus create an LLC. Tagteam is right that from the tax point of view, they are treated the same ("disregarded entity" means that the IRS will ignore that you have "incorporated" your company in your state by making an LLC).

However, if your spouse is involved in the business, then even the tax answer will depend on what type of state you are in: community property or not.

And your business liability is not something that we can advise on here - you may want to consult with a local small business attorney.