What are the tax advantages of an LLC?

Answer by  Anonymous

It has protection that doesn't come with a sole proprietorship as well as distinct funding and tax advantages. No double taxation and avoids tax issues associated with C corps.

Answer by  informant31 (510)

You do not have to pay both corporate and personal taxes on your profits and expenses. This is an advantage because your business profits,and your expenses and losses flow through to your 1040 federal form as a personal tax.

Answer by  Liz59 (10966)

Well the main advantage is that the LLC is going to lower your taxes. All major corporates use LLC to achieve their financial goals. So it is recommended to go ahead whenever possible.

Answer by  asanson (253)

The tax advantages of an LLC are that it is taxed like a partnership, but the owners are protected like a corporation. The main disadvantage that corporations face are double taxation, which doesn't burden LLC. If the LLC has only one owner then it is taxed like a sole proprietorship, which is nice.

Answer by  CoachKat (88)

You avoid the double taxation of a corporation. The profits of an LLC pass directly through to the owners' personal tax returns. The LLC does not file a tax return.

Answer by  mrsmyers (474)

The tax advanatage to having an LLC as opposed to say a corporation, would be that you would have limited liability. When you form a corporation you are putting youself in a position to be taxed double and you are in for a world of paperwork, this is not the case with an LLC.

Answer by  Liz59 (10966)

LLC provides a tax free benefit to those who are interested in it. Also, provides greater return on your taxes. All in all, you should apply for the LLC and take it forward with you. My friend received many tax benefits and if you are not convinced, search more on the net and you will find the answers.

Answer by  andy4us (75)

An LLC has pass through taxation just like a sole proprietorship or partnership. This avoids the double taxation issue of a C corporation. An LLC also provides liability protection for the owners. In California LLC's must pay a minimum of $800 in taxes each year.