Minnesota S-Corp and LLC Attorney

Minnesota small businesses often wonder whether to form a Minnesota S-Corp or LLC. The answer isn’t simple. Here are some questions to consider:

How many owners will there be?

An S Corp may only have 100 owners. An LLC does not have this restriction.

Who will own the business?

An S Corp may only be owned by individuals, estates, certain trusts, and certain tax exempt organizations. Partnerships and C corporations cannot be owners. An LLC does not have this restriction.

How much money will the business earn?

If the business earns more than the fair market salary of the owner, the business may reduce its tax burden by being taxed as an S Corp. Of course, an LLC can be taxed as an S Corp.

Does the business owner need a W2?

Sometimes a business owner needs a W2. For example, a person seeking a self-employed H-1B visa would need a W2. An S Corp issues to its owner a W2. Similarly, an LLC taxed as an S Corp issues to its owner a W2. An LLC taxed as a sole proprietorship or partnership does not issue a W2 to its owner.

Other considerations?

This article addresses some of the popular factors when determining whether an LLC or S Corp is better for a small business. However, there are many other factors. To determine if an S Corp or LLC is better for you, contact a Minnesota S-Corp and LLC attorney.

Is a Minnesota S-Corp and LLC right for me?

Attorney Aaron Hall is experienced in S-Corp and LLC formation issues. He also advises corporations, partnerships, and other small businesses on a variety of business law issues. To discuss your questions with a business lawyer, contact Aaron Hall for a phone consultation.

Aaron Hall is an LLC and S-Corp attorney in the Twin Cities Law Firm, located in Minneapolis, MN, serving Minneapolis, St. Paul, and throughout Minnesota.