What is LLC and should I use this for my business?

An LLC is a distinct type of business that offers an alternative to partnerships and corporations, by combining the corporate advantages of limited liability with the partnership advantage of pass-through taxation.

LLC ( Limited Liability Company ) is considered a very flexible structure to incorporate business. It limits liability and not much paper work involved. Payroll is not required for the members of the LLC like corporations.

Professionals used to mostly recommend for real estate businesses but now a days it is becoming a most suitable structure for all businesses to limit liability and avoid additional paper work involved like corporations. There is no limit for the shareholders like an s-corporation.

Some folks think that they can register their businesses in any state. But technically it is not true. You have to register a business in the state where you are physically located. For example; you are located in New York City and doing retail business where you are subject to collect sales tax from your client. You can not register it in the state of Delaware to avoid sales tax. You can still register your business in the state of Delaware but then you will have to create a foreign entity in the state of New York to conduct business of your Delaware entity. In that case you will have to maintain two states. If in the state of Delaware sales tax is exempted you will have to still pay gross receipt tax and you may wind up paying more taxes.

Same in the state of Alaska sales tax is exempted but there are other taxes involved.

So, most professionals advise to keep it simple and register your business according to your residency.

To Read More : What is LLC and should I use this for my business?
Source : Business Documents Filing in 50 States

http://www.infotaxsquare.com/what-is-c-corporation.html