When starting a business, many entrepreneurs choose between an LLC (Limited Liability Company) or electing S-Corp status with the IRS. Here’s a simple breakdown:

• LLC: Easier to set up, flexible management, profits are reported on your personal tax return. Great for freelancers or small businesses.
• S-Corp: Requires more paperwork, but allows you to pay yourself a “reasonable salary” and take additional profits as distributions, which can reduce self-employment taxes.

Which is better?

• If you’re just starting or keeping things small, an LLC may be the best choice.
• If your business is growing and generating higher profits, an S-Corp could save you thousands in taxes.

Always consult with a tax professional before deciding.