So does having an LLC taxed as an S-copr give you the same tax advantages (lower SS and SE taxes) as just having an S-corp?
an LLC taxed as S-corp is considered by the IRS identical in every way to a regular S-corp.
Does an LLC-as-S-corp have the same liability protection as a regular LLC? If so, why ever do just an S-corp, since LLCs are so easy to set up and manage and provide such great protection?
- yes
- now you’re getting it.
Okay, then there really is no reason to set up an S-corp for wholesaling purposes, because you can get the exact same tax advantages (lower SET/SST) from an LLC-as-S-corp, PLUS you get the LLC protection, PLUS the LLC ease of management. Right?
you’ve got it.
Thanks!
That is not true. LLC’s pay a higher rate for SS Tax and have fewer deductions. Maybe this will help
http://www.instantinc.us/pdf%20files/Incorporation%20Newsletter-1.pdf
regarding the original post. the question was “is there any tax difference between an S-corp and an LLC taxed as an S-corp.” The answer is no.
regarding the article referenced. it states that “an LLC is taxed as a sole proprietor”. While technically not incorrect, it IS misleading. The LLC will only be taxed as a sole proprietor IF 1) it has only one memer and 2) the organizer does nothing to change the entity’s tax status.
There is no tax law for LLC, so the IRS allows you to choose which set of laws it will pay taxes under; either personal or corporate. A single member LLC may choose to be disregarded as a separate entity from the individual and tax as sole proprietor (the default) OR may choose corporate or S-corp taxation.
A multi-member LLC may choose partnership taxation (default) or corporate or S-corp taxation.
Once the election is made, the LLC is considered by the IRS to have all the attributes of the chosen entity. Which brings me back to the answer to the original question: “is there any tax difference between an S-corp and an LLC taxed as an S-corp.” The answer is no.