Nevada LLC or Inc?

For many business people choosing what business venture to go into can be very confusing at times. One of the confusing choices is between a Nevada Incorporation (Inc) and a Nevada Limited Liability Company (LLC) .Choosing between a Nevada LLC or Inc goes way beyond choosing an abbreviation to appear at the end of your business name. The two present different advantages that one is bound to enjoy. They also have their fair share of disadvantages that one may enjoy.

The advantages of setting up a Nevada LLC are numerous. First with Nevada LLCs the business owner has liability protection. This means that should the business run into serious debt then the owner's personal property cannot be sold to pay off the debt.

Second, with Nevada LLCs one enjoys lower tax rates as taxes are limited to the business itself. This is unlike the case with Nevada corporations where one is taxed twice: once for the corporation itself and then again for the individual shareholders. Not so with the Nevada corporation.

Nevada LLCs have less paperwork required of them. This is so because with these LLCs you are not required to file annual end year reports as is the case with Nevada corporations.

Nevada LLCs enjoy greater flexibility. This is so because the rules and regulations applying to their formation are less strict .This is unlike the case with Nevada corporations where there are strict rules and regulations to be adhered to.

Nevada Corporations on the other hand are best suited for people who intend to go public. There are two types of Nevada corporations: a "c" corporation and an "s" corporation. The "s" corporation is the more popular than the "c" corporation. Opening a corporation allows one to enjoy the following advantages:

As they have the potential to be publicly traded, venture capitalists are more likely to invest in an Inc than in a LLC.

The taxation rates for "S" corporations are similar to those of LLCs. This means that the business owner pays tax only once.

Third, businesses formed under "s" corporations have a limit as to the number of shareholders they allow. The maximum number of shareholders is usually 35 for most Nevada corporations.

Choosing what business structure is one of the most important decisions you will have to make as a potential business owner. With the above considerations in mind, this should not be a tough decision to make.