LLC VS CORPORATION
Both protect owners so they’re not personally on the hook for business liabilities or debts. But, key differences include how they’re owned (LLCs have one or more individual members, and corporations have shareholders) and maintained (corporations generally have more formal record-keeping and reporting requirements).
GENERAL INFORMATION ABOUT EACH
Better for max flexibility in how you manage and run your business; board of directors not required. Unlimited owners (aka “members”) allowed
You’re not personally on the hook for business liabilities. Taxed once or twice; you’re free to choose which can help minimize taxes.
Ongoing filings and fees to stay in compliance, LLCs can’t go public
Not recognized globally; you may be taxed as a corporation in other countries
Better for smaller corporations, 100 shareholders max.
Owners can only get common stock. You’re not personally on the hook for business liabilities.
Taxed once—only shareholders pay on profits received.
Ongoing filings and fees to stay in compliance.
Less management flexibility; must have a board of directors, More admin; strict rules about holding meetings and keeping records
All shareholders must be U.S. citizens or residents
Best if you plan to go public one day; can issue shares to founders, employees, and investors. Unlimited owners (aka “shareholders”) allowed and owners may get preferred stock.