Which type of corporation???

I'm setting up an ecommerce business and wondered what everyone would recommend as the proper corporation to set it up as? I understand that you are not an attorney and you are not giving legal advice, I'm just asking for opinions and will research with council accordingly.

I will be selling hard goods thru dropshippers at first and also adding my own ebooks and info products shortly after.

Would I use an LLC, S,C? What would you use or what are you using?

thanks

 

There are local variations too. In some states, the LLC is clearly more advantageous for smaller companies. I'd really recommend talking to a CPA about your specific situation particularly regarding taxes. And, it wouldn't hurt to talk to a real lawyer to find out the exact legal position of each form of company.

 

It really depends on the revenue levels and the number of stakeholders involved. As peter stated, best go directly to financial and legal counsel to get the best information.

Good luck with your venture.

 

Totally different in every state. For example, in California, you'd NEVER want to form an LLC or you're in for a nasty surprise at tax time: what my tax attorney calls "the sucker tax." Unless you're a lawyer, accountant, or other qualifying professional service firm, CA LLC's have to pay state income tax on gross earnings, not net!

According to him - and I repeat this anecdotally - CA created the LLC to lure people away from taking too much advantage of personal corporations. An LLC replaces what used to be called a "Professional Corporation", the benefits of which the rest of us don't qualify for, so we get nailed with the Sucker Tax if we form one.

I repeat that I repeat the above anecdotally - YMMV.

 

I've always used a standard corporation with the "S" elective. Has worked well for the 9 or so companies (online and off) I've set up. As everyone else has pointed out, talk to your accountant and attorney as every situation is unique onto itself. It's worth the small fee for the expert advice.