What are the tax benefits of an LLC compared to a corporation?
LLCs often have pass-through taxation, meaning profits are taxed only at the owner's level, while corporations face double taxation.
Can you explain what double taxation means?
Double taxation occurs when a corporation's profits are taxed at the corporate level and again as dividends to shareholders.
Are there any specific tax deductions available for LLCs?
Yes, LLCs can deduct business expenses like operating costs, salaries, and even some health insurance premiums.
What about corporations? Do they have unique tax benefits?
Corporations can benefit from lower tax rates on retained earnings and may have access to more tax credits and deductions.
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