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What are the main factors to be considered for an entity selection among LLC, S corp, and C corp?

kwyp
Level 4

What are the main factors that  decide an entity tax filing selection? 

1.) If an entity net income is at 37% individual tax rate, can select C corp without thinking? 

2.) If an entity net income is about 300K, which is a better option? LLC, 1120S, or 1120C?

3.) If an entity with three partners. which is a better option, 1065, 1120S, or 1120C?

4.) if a LLC or a S corp sold after 5 years. can 50% of  capital gain be tax excluded? 

 

0 Cheers
6 Comments 6

I have a small library of resources for these questions. I suggest you start one.

 

"without thinking"." There are only a few tax issues that can be solved "without thinking."  What do you mean?

sjrcpa
Level 15

Don't let the tax tail wag the dog.

There are legal issues; fees, etc.


Ex-AllStar
qbteachmt
Level 15

Yay, school is back in session!

*******************************
"Level Up" is a gaming function, not a real life function.
sjrcpa
Level 15

I think kwyp changed their screen name, too.


Ex-AllStar
abctax55
Level 15

Link to first post:

https://accountants.intuit.com/community/proconnect-tax-discussions/discussion/whether-proconnect-or...

I'm curious, since from July, is this the semester or quarter system 😉

"*******Tax software is no substitute for a professional tax preparer*******
( Generic Comment )"
PATAX
Level 15

I don't mean to be mean, but you need to do some research on your own.