Legal Question in Legal Ethics in Texas
How should I incorporate, I read some things like S Corp says "no partnerships" but want to make sure we are protected the BEST possible way.
Facts:
Security Business (as armed officers)
2-3 business owners, all USA citizens (50/50 or 40/40/20 split)
No plans on going "public"
We will benefit financially from profits
Owners/Employees paid hourly and salary
Pass thru taxation doesnt matter
Startup will be provided by private funds
Vehicles and company property will need to belong to company
May seek loan in the future to expand
I have been told more than likely a S Corp is the way to go however I have been told an LLC can also be obtained. Most online tools are stating either C or S Corp due to certain responses. Additionally can an S Corp have 3 owners as partners?
1 Answer from Attorneys
Most people form LLCs these days instead of S-Corps. The governance formalities for an LLC are simpler than for an S-Corp. You say pass-thru taxation does not matter, but I would check with a tax accountant before making that determination. That is a very critical thing to look into before just filling out a form on-line. An S-corp can have three shareholders. Good luck!!
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