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What's better a corporation or sole propriertorship?
|Posted by BcemBPot, 02-09-2002, 07:25 PM|
|I want to start as a reseller and I don't know if I should open a coproration or sole propriertorship. Please share your ideas and thoughts. Thank you!
|Posted by FreedomNet, 02-09-2002, 07:43 PM|
|Pretty complex topic. The very short version is creating a corpation (I assume you mean an S corp) is more expensive (filing fees, franchize taxes, etc) and a lot more complex come tax time. You'll need to keep company books, do a balance sheet and file a corporate tax return in addition to your personal return. Sole propritership allows you to keep your company profits/losses on your personal income tax return.
The plus side is a corporation helps present you as a larger more established company and I think looks better if you get a merchant account to collect credit fees. In theory it should also protect your personal assets better, but some people will say that is dwindeling as lawyers will attempt to pierce your corporate veil by showing you were negligent and therefore making your personal assets at risk.
|Posted by Gurudev, 02-09-2002, 08:03 PM|
|Depends upon a lot of things. LLC is also a good way to go, which is in between a corporation and a sole prop. I would recommend an LLC to start with and a corporation, once you grow. Sole prop. is definitely riskier compared to the other two.
Search the net and you will find a lot of information. You can start with sites like
|Posted by BcemBPot, 02-10-2002, 01:05 AM|
|Thank you for the information I'll definitely look into the sites you've send me. If anybody else wants to share information feel welcome.
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