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Advantages of LLC
Disadvantages of Limited Liability Companies (LLCs)
Advantages of C (corporations)
Disadvantages of C Corporations
Qualifications for S Corporations
100
If you are a very careful person, an LLC may be right for you. All your personal assets are protected, which means you have _____liability for your company.
what is limited liability.
100
Limited liability companies do not have the opportunity to gain investors, they do not have the option to sell ____.
What is stock.
100
Advantage: A great perk of being in a Conventional Corporation, many investors can relax knowing that if a corporation fails, they are only responsible for the amount they invested in the corporation.
What is limited liability.
100
Incorporations may cost thousands of dollars and require lawyers and accountants to get started. Thus the ____of getting started can be hard to swallow.
What is initial cost.
100
What is the limit of shareholders an S corporation can have?
What is 100 shareholders.
200
Do you believe in the freedom of choice? Do you like a say in your taxes? Well _____ of taxation, gives you the ability to choose to be taxed as partnerships or corporations.
Choice of taxation.
200
LLCs do not last forever. They are required to state dissolution dates in the articles of organization, and if a member dies it may cause the LLC to dissolve automatically. This means that LLCs have a _____ lifespan.
What is limited.
200
Often times, when starting a business, money is a problem. However by selling stock shares of their company, the corporation has money to get on it's feet and really take off.
What is ability to raise more money for investment.
200
Disadvantage: As citizens of the United States, we are all obligated to pay money to our government for a variety of things. Corporate income is taxed twice. What is this called?
What is double taxation.
200
There are two requirements that shareholders must meet. What are these two requirements for shareholders?
What is a citizen or permanent resident, and an individual or estate.
300
No one likes rigid rules. LLCs do not have to comply with ownership restrictions as S corporations do. Owners can be a person, partnership, or corporation. The rules of ownership are thus very _____ in LLCs.
What is flexible.
300
Do you think less is more? Well if so, that's great. Because in a limited liability company, there are fewer incentives and fringe benefits such as.....
What is stock options.
300
corporations have the ability to take advantage of opportunities anywhere in the world, this gives them the ability to grow, or get to a bigger ___.
what is size.
300
Disadvantage: To start a corporation, there is a lot of financial records, timely meetings and more to deal with. If you do not like writing, you will not like the amount of _____ that needs to be done.
What is extensive paperwork.
300
Passive sources such as rents, royalties, and interests can derive no more than ___ percent of income.
What is 25 percent.
400
The distribution of profits and losses is not set in stone. Profits and losses don't have to be distributed in proportion to the money each person invests, as in corporations. This means the distribution of profits and losses is very _____, and quite able to change.
What is flexible.
400
What kind of taxes must LLC members pay?
What is self-employment.
400
Corporations are separate from those who own them, the death of one or more owners does not terminate the corporation's life, this "immortality" concept is known as what?
What is perpetual life.
400
An individual who incorporates must file both a corporate tax return and an individual tax return, both of these combined means that individuals who incorporate must file ___ tax returns.
What is two tax returns.
400
How many classes of stock may an S-Corporation have?
What is one class.
500
LLCs have operating flexibility. They are not required to keep minutes, file written resolutions, or hold annual meetings. They just have to write a written _____ agreement, similar to a partnership agreement, describing how the company is to be operated.
What is operating agreement.
500
Although there isn't as much of this to be done as in a corporation, LLCs are still required to do quite a bit of ____ work, which is definitely a hassle for owners.
What is paperwork.
500
By offering perks such as stock options, who is attracted to come and work for the corporation?
What is talented employees.
500
If commitment scares you, corporations might not be the way to go. Corporations are easy to start, but hard to stop- and _____ of a corporation is not easy.
What is termination.
500
If an S-Corporation loses its status, may not operate under it again for how long?
What is five years.