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C corp vs S Corp Vs LLC

Discussion in 'Business Operations' started by Budget Lawn Service, Feb 5, 2007.

  1. Budget Lawn Service

    Budget Lawn Service LawnSite Member
    Messages: 3

    We were advised several years ago to form a C Corp but we always seem to be in a tax pinch.I know we need to make some changes but unsure what to do .We also lay off all employee's including the officers in winter months and collect unemployement,can that still be done as a S Corp or LLC?
  2. Total.Lawn.Care

    Total.Lawn.Care LawnSite Senior Member
    Messages: 840

    Honestly, I do not think it is legal to lay off the company officers and collect unemployement. You must have a connection in the unemployement office. If you are an officer (owner) of a company, then you laid yourself off and it is a choice to do. You may have different unemployement laws in your state, but I am sure that you cannot get away with it here.

    In our state, even soldiers cannot get unemployement returning from a deployment until all of their leave time has been paid out. That is wrong.
  3. Total.Lawn.Care

    Total.Lawn.Care LawnSite Senior Member
    Messages: 840

    Sorry, to answer your actual question, you probably need to change to a S Corp. The C-Corp gets taxed as a totally seperate tax entity, like it is a person all its own. Then you get taxed as an individual based ont he income you pay yourself from the company. If you go to a S-Corp or LLC, then any taxable earnings would be reported through your personal income tax return. This will simplify yoru tax filings quite a bit, and also change your tax tables.

    Would probably be a good move to get the proper filings done now, or you may face a penalty later in the year and have to pay some extra fees to change your structure with the IRS.

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