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Showing results for tags 'LLC'.
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Wasn't sure exactly where to put this one, but as we're founding our business (we're establishing ourselves as an LLC in NC) we're trying to determine if there is any merit in paying a CPA to do our books. I ask because we plan to do a significant amount of paperwork on a daily/weekly/monthly basis, and so I'm curious about the value a professional could add. I'm not all that confident in my own abilities as an accountant for a small business, but would like to know if anyone uses an accountant, what types of qualities or experience did you find valuable in your accountant? Any information on expected rates for this type of work would be helpful as well. I'll also take any referrals, if there are any to be had. Many thanks for the input.
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Disclaimer: I got a little confused on this. The title says S-Corp but I was referring to a C-Corp. Sorry for the confusion. A few days ago we were ready to file to set up our LLC. But at the last minute I asked my accountant a few questions and now we're considering forming an C-corp. It's just my wife and me as partners. Here's why: As an LLC your company is considered a pass-through entity. All company profits will be entered on your personal taxes because there is no corporate tax on LLC's. That means fewer forms at tax time, but you do have to pay quarterlies and Social Security out of your own pocket. Even if you leave money in the company account it still gets reported and you have to pay personal taxes on that money. As a C-corp your company is actually a separate entity. It pays corporate taxes on profits. (rates are better below $75K) Taxes are more complicated but the company does pay employer contributions. You have to have meetings. You draw a reasonable wage and pay personal taxes on that amount. The reason this is a huge concern for us is that we have to consider financial aid for our college age daughter. As an LLC the company and personal income is muddled. I believe we'll look better on paper than we really are even though it's the company that's retaining profits, not us personally. Those company savings will be for rainy days, expansion, etc. So right now the C-corp looks like more hassle but an overall benefit. I'm by no means an expert but this is my understanding. Advice or opinions will be appreciated.
