Can you incorporate an llc

Choosing your preferred entity type is important, but it's important to know you can change it later as your business's circumstances change.

For most business owners who plan on starting small and growing gradually, an LLC is the right choice. For others, such as fast-growing startups and companies looking for investors right out of the gates, incorporating as an S-corp or C-corp might be the better option. However, businesses can change their legal structure as they grow and circumstances demand it.

Adam Uzialko. What is the difference between an LLC and an Inc. This guide will explain how the two entities differ and why it matters to your small business. LLCs limit owner liability and offer more flexible taxation as a pass-through entity. Corporations, such as S-corps and C-corps, are entities for larger, profitable businesses or those with shareholders.

How you incorporate your business entity has a profound effect on the organization of your company, the distribution of profits and losses, and the way your business is taxed.

This article is for entrepreneurs trying to determine the best type of business entity for their company when preparing to incorporate. What is an LLC? What is an Inc.? Can a company be both an LLC and an Inc.? Business News Daily Staff.

Adam Uzialko is a writer and editor at business. He has 7 years of professional experience with a focus on small businesses and startups.

He has covered topics including digital marketing, SEO, business communications, and public policy. He has also written about emerging technologies and their intersection with business, including artificial intelligence, the Internet of Things, and blockchain.

Start Your Business. Updated Paying taxes is never fun, but there are steps you can take to One of the unique features of incorporating or forming an LLC is that you do not necessarily have to form the company in the State where you do business. When deciding on which State to incorporate in, there are basically 2 choices and the New Mexico LLC discussed below :. For the majority of small businesses, incorporating or forming an LLC in your home state is usually the easiest and least expensive option.

This is especially true if you intend to get a bank account and business license or rent office space in your home state. This is not to say there are not valid reasons for choosing another State, we just like our potential clients to be aware of the additional steps required when choosing a State outside of their home State.

Further discussion with your attorney or other advisor is recommended. Delaware is where most large corporations Fortune , Nasdaq, etc. Related Article: Read how an attorney that specializes in startups recommends setting up a Delaware Corporation.

Nevada has recently exploded in popularity for both large and small businesses. We also offer a Nevada Virtual Office solution to further assist our Nevada clients. It features some benefits compared to a Nevada entity including:. We also offer a Wyoming Virtual Office solution to further assist our Wyoming clients. The corporate entity is taxed, and shareholders can also be taxed for dividends, depending on whether it is an S corp or C corp designation.

An LLC appeals to individual business owners because it isn't considered a separate legal entity by the Internal Revenue Service and offers flexibility in decision-making that occurs with sole proprietorships and partnerships. Just like a corporation, LLC members are shielded from personal liability on losses, debts, and taxes. An LLC doesn't have to deal with tracking meeting minutes and navigating the complex business structure of a corporation, but at the same time can enjoy tax benefits similar to a corporate entity.

Business owners should decide whether to form an LLC or incorporate. What makes the most sense depends on your long-term strategy. An LLC is a good option to begin, especially if you have multiple owners, need flexibility, and are starting a new business service or product. In terms of protection, an LLC allows business owners to protect their personal assets in case of financial or legal trouble. However, if you want your LLC to raise capital or issue stocks, you'll likely need to look into forming a corporation.

Also, if your entity needs additional oversight, an independent board, and approved bylaws, a corporation is a more suitable option. This portion of the site is for informational purposes only. The content is not legal advice. The statements and opinions are the expression of author, not LegalZoom, and have not been evaluated by LegalZoom for accuracy, completeness, or changes in the law.