How to Choose the Proper Entity for Your Business
By Tim Randle
First, let me state that I'm not an attorney and the rest of this article is just based on my experiences so I'd advise you to contact John Hyre at http://www.realestatetaxlaw.com to get some solid, specific advice on your particular situation.
Also, this article is not going to discuss land trusts, which some of you may have just stumbled upon. A land trust is not an entity. Although it is frequently used in conjunction with entities, it is merely a paper device used to shield property ownership from the public.
When I first got going, the recurring wisdom was that an investor should use a C corp for cash deals. By cash deals, I mean anything that throws off cash quickly. It might be a wholesale flip, retail assignment, rehab and retail, option, etc.
There were numerous reasons why this was and is recommended. First, the C corp offers great liability protection and allows the owner to take advantage of fringe benefits, thus draining the corp of excess profits through legitimate expenses.
What I've learned the hard way is that this entity is not necessarily better for cash deals than other entities unless you're doing serious cash numbers. By this I mean that the added benefits that a C corp offers are not available to you without a ton of cash coming in.
Stop and think about it for a moment. Are you going to generate enough cash to pay normal operating expenses like salary, marketing, funding, overhead, etc. and still have cash remaining to set up company programs for retirement, medical, insurance, education, etc.?
Typically, the answer's going to be "No", at least during the formative years. The primary downside to a C corp is that any losses, paper or otherwise, do not flow through to your personal tax return. You don't get to use them anytime soon.
非常感謝Stacy你的回答耶!!!如果你的時間允許，我另外還有三個知識+的問題，希望你能幫幫忙，謝謝尼^ ^ ！
- 1 decade agoFavorite Answer
可能是批發、零售、rehab and retail, option, 等等....
2008-05-09 22:16:05 補充：
2008-05-09 22:16:56 補充：
2008-05-10 16:30:00 補充：
(少打了)Source(s): 自己的淺見 感覺沒有翻的很好, 希望有幫到你˙ ˇ˙ 我翻的沒有很好, 補充資料, ˙ ˇ˙