Paging John Hyre...Need Help

I am struggling to find competent advice.
I have formed a partnership with a co-worker with the goal of rehabbing homes.
I have sought out legal and accounting advice but have not found a comfort level.
I prefer an LLC over an S Corp b/c of the paperwork and payroll taxes.
We both exceed the $94,200 Social Security threshold through our wages and believe we are not subject to pay additional SS Tax from profits in this venture, only Medicare—is this correct?
We both have substantial assets that we want protected-this makes us a bit weary of LLC’s since some claim they are not battleground tested in the court room.
Could you kindly suggest what direction you would go and your thought process?

Also- the lawyer we spoke to quoted us $1000 to write, review, and file the article of incorporation. My CPA-he is a college buddy and his strong point is not small business tells me not to waste the money-the forms for Maryland are online and its not like I am going public anytime soon.

Your assistance if greatly appreciated-any other comments are welcomed.

$1000 is pricey for “fill in the blank” forms. what else is he providing? obviously this doesn’t include tax advice. managment agreement?

Mark,
Thank you for your comments. The attorney did not specifically mention this agreement rather he stated “for approximately $1K I will file the articles of incorporations and set up the business the right way”. Because of your post I will inquiry into all the documents I will receive for this price. If there any other documents that I should ask about in my conversation?

Mark, please feel free to comment on the first part of this questions. All comments are welcome.

Thanks Again,

does that include the state fees, or is it $1k + state fees?

tax election forms of your choosing?

ongoing “free” advice?

for comparison, I usually charge $200 plus the state fees for all that. maybe I’m too cheap. It’s just a form.

on the rest, what’s your objective?

I always recommend the LLC since it’s a stronger and simpler form than a corporation. I can’t speak as to “battleground testing”, but there are certainly a lot of them out there. any shortcomings would probably be becoming apparent by now.

Since you’re over the FICA limits, taxing the LLC as a C-corp will probably be your lowest overall tax burden.

Mark,
Thanks for the follow-up.
I spoke to him and asked some follow- up questions.
He fee does include all paperwork as advisable-(his words) including a management agreement.
This does not include any state fees.

He also stated he charges for consolation moving forward at a rate of $200/hr so I doubt there is any free advice.

I have the state form and no where does it ask me how I wish to be taxed-partnership, s, or c. Do I need to decide this now or when I file my taxes?

Secondly-I receive significant fringe benefits from my wages, all medical expenses, auto, life insurance, and retirement. I am weary of leaving too many assets inside the Corporation in the event of being sued. I was considering electing the partnership tax preference.

you set up the LLC with the state. then you tell the IRS to tax it as an S-corp on form 2553 filed with IRS. YOu need to file this within 75 days of setting up the LLC or you make life harder for yourself. (it can be fixed if you don’t, but just do it anyway. life’s already enough of a hassle)

what assets are you leaving in the LLC? and why would partnership make any difference?