When starting a new small business, choosing between an S corporation and a limited liability company (LLC) depends on your goals for taxation, ownership structure, and administrative complexity. An LLC offers flexibility, with fewer formalities and the ability to be taxed as a sole proprietorship, partnership, or even an S corp. In contrast, an S corporation provides potential tax savings on self-employment taxes but comes with stricter ownership requirements and corporate formalities. If you’re looking for simplicity and flexibility, an LLC may be the better fit; if you’re planning to pay yourself a reasonable salary and reinvest profits, the S corp structure might offer more tax advantages. It’s wise to consult with a tax professional or an experienced attorney to determine which option aligns best with your long-term strategy.
If you’re planning to start up a new business and have questions about your business structure, give us a call at 253.858.5434 to see how we can help. We represent clients throughout Washington and Idaho and are available to meet in person, by phone, or via video conference for the convenience of our clients.