What is the main difference anymore between an S Corp and an LLC?
Other than the obvious tax forms used, and assuming flow-through taxation to the individual return, what is really the inducing difference to choose between the two?
The only difference I can truly see is that the expense is higher with an LLC to draft an operating agreement that address all members versus a more standard approach with an S Corp.
Thanks for your input
Taxation best answer:
Answer by imisidro
Here are the differences between S Corp and LLC
- Restrictions on who can be owners (called "shareholders") of an S corporation, which can have no more than 75 shareholders. There are no restrictions on the ownership of an LLC
- S corp has no flexibility in how profits are split up amongst its owners, as profits must be distributed according to the ratio of stock ownership. Owners of an LLC can distribute profits in the manner they see fit.
The source below contains more info on the differences between the two legal structure
Taxation
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