LLC or S-Corp Business Filing?
 

I'm about to dissolve a current LLC because my accountant told me it's easier to get investors if you incorporate. Is this true? I'm not sure the benefits of either. If you have either, please give me your input.

I'm going after some investors and I have a rock solid proposal. Does it really matter if I'm a LLC or a Corp?

Yes, it matters. For such an important business decision, I would recommend consulting with a local lawyer specializing in that field, unless you want to do all of the research and legal paperwork yourself.

If there are going to be contracts involved, then I think it would be imperative to get good sound legal advice. :2 cents:

Good luck! :thumbsup

ADG

if someone wants to invest, they'll wait 2 weeks for you to setup a different business structure... so not sure getting a real corp will accomplish anything...

No idea... I've had both and have no idea the difference. I would say an S-Corp as it seems more solid, LLC's are opened up all the time as many times a second company to the parent.

Sub-chapter S

An llc doesn't pay taxes. Earnings are passed thru to it's members. It's like a partnership.


.

The laws are slightly different based on the state, but here in FL an LLC is better for multiple people and S-corp for individual shareholder.

I have 2 LLCs with Partners and an S-corp for myself.

With a LLC ownership is broken down in percentages, with a S-Corp, you have to declare your initial stock number and divides shares based on ownership status. Even if it's not publicly traded, corporations have a stock structure. If two people own a LLC then it's 50% and 50%. If two people own a S-Corp, it's 500 shares and 500 shares (if 1,000 was your filing declaration).

The reason I believe it can attract more investors is because with a S-Corp you can offer payment terms as well as equity in the company, therefore enticing more serious investors. Say the initial investment is an equity investment and I offer 10% of the shares. I would pay back the initial investment with a modest interest rate (10%-12%) for a predetermined amount of time and once those payments are satisfied, the investor retains 10% of the shares therefore 10% of the dividends. Until I either buy them out or arrange a settlement.

And there is where I'm confused. If you have partners with a LLC wouldn't it in reality be a LLP? Does it matter? I thought only one person could own a LLC. Thanks for the information, keep it coming.

I choose off shore corp. If you need help for Costa Rica hit me up.

you're all retarded.

TripleXPrint that includes you, no one is interested in your stupid idea.

If you are doing a startup and plan on getting investors, look into a C corp in Delaware but most importantly consult a lawyer.

Marion not gonna chime in with his/her expert corporation opinion? :1orglaugh

Yeah, You should definitely contact the pros on this one: http://onestopcorporationshop.com/

Not sure, but I would imagine they would prefer a corporation. As stated, they'll get shares instead of %, plus it helps separate your personal assets from company assets, making things cleaner. For example, I would imagine they'd require you to sign over ownership of all intellectual property to the corporation, so the idea will no longer be yours, but the corporations. This way if shit hits the fan, or you don't pay up, it's much easier for them in court to take the corporation away than anything you personally own.

VC (venture capital) or IPO (initial public offering) = C Corporation