Lance and Rodney are contemplating starting a new business to manufacture computer software games. They expect to encounter losses in the initial years. Lance's CPA has talked to them about using an S corporation. Rodney, while reading a business publication, encounters a discussion on limited liability companies(LLCs). The article talks about the advantages of using an LLC instead of an S corporation. How would you respond to their inquiry? | eBooks | Education

Lance and Rodney are contemplating starting a new business to manufacture computer software games. They expect to encounter losses in the initial years. Lance's CPA has talked to them about using an S...

Lance and Rodney are contemplating starting a new business to manufacture computer software games. They expect to encounter losses in the initial years. Lance's CPA has talked to them about using an S... PLDZ-4316 Free
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Lance and Rodney are contemplating starting a new business to manufacture computer software games. They expect to encounter losses in the initial years.? Lance's CPA has talked to them about using an S corporation.? Rodney, while reading a business? publication, encounters a discussion on limited liability companies?(LLCs). The article talks about the advantages of using an LLC instead of an S corporation. How would you respond to their? inquiry?

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Lance and Rodney are contemplating starting a new business to manufacture computer software games. They expect to encounter losses in the initial years.? Lance's CPA has talked to them about using an S corporation.? Rodney, while reading a business? publication, encounters a discussion on limited liability companies?(LLCs). The article talks about the advantages of using an LLC instead of an S corporation. How would you respond to their? inquiry?

The basis of the S corporation? shareholder's interest includes a ratable share of the S? corporation's liabilities. This amount can be greater than the basis in the S? corporation's stock and permits a greater loss or deduction? pass-through.

An LLC has no restrictions on the type or number of owners. An S corporation is limited to 100? shareholders, none of which may be a corporation or a partnership.

 

An S corporation is not subject to? corporate-level taxes which is advantageous to Lance and Rodney who will be starting a new business and will not have the excess cash to pay the taxes required in an LLC.

S corporations are? flow-through entities that simplify the accounting books and records. An LLC is a complex entity to set up and requires many difficult calculations.

 

Lance and Rodney are contemplating starting a new business to manufacture computer software games. They expect to encounter losses in the initial years.? Lance's CPA has talked to them about using an S corporation.? Rodney, while reading a business?
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