<html xmlns:v="urn:schemas-microsoft-com:vml" xmlns:o="urn:schemas-microsoft-com:office:office" xmlns:w="urn:schemas-microsoft-com:office:word" xmlns:m="http://schemas.microsoft.com/office/2004/12/omml" xmlns="http://www.w3.org/TR/REC-html40"> <head> <meta http-equiv=Content-Type content="text/html; charset=us-ascii"> <meta name=Generator content="Microsoft Word 12 (filtered medium)"> <title>Message</title> <style>  </style>  </head> <body lang=EN-US link=blue vlink=purple> <div class=Section1> <p class=MsoNormal><span style='font-size:11.0pt;font-family:"Calibri","sans-serif"; color:#1F497D'>Hi Geoff:<o:p></o:p></span></p> <p class=MsoNormal><span style='font-size:11.0pt;font-family:"Calibri","sans-serif"; color:#1F497D'><o:p> </o:p></span></p> <p class=MsoNormal><span style='font-size:11.0pt;font-family:"Calibri","sans-serif"; color:#1F497D'>One question I would ask of your accountant  is why would he would recommend an S Corp over an LLC for your situation.  I am going to assume that you are a one person business without employees.  You should be aware that you will be required to fill out three returns each year as an S Corp – first, the corporate return; second, the state return; and third, your personal return.  No matter how simple your business may be, the preparation of the corporate return is sufficiently daunting that most people have an accountant do it for them.  To complicate matters further and, depending on how you set things up, you may have to do payroll taxes with monthly tax deposits and quarterly reports and so on.  <o:p></o:p></span></p> <p class=MsoNormal><span style='font-size:11.0pt;font-family:"Calibri","sans-serif"; color:#1F497D'><o:p> </o:p></span></p> <p class=MsoNormal><span style='font-size:11.0pt;font-family:"Calibri","sans-serif"; color:#1F497D'>An LLC confers the same liability protection and most of the other advantages of incorporation, yet you would have to file only two returns – your state and  the LLC return that combines the personal and business into one return.    But I would ask the question of myself – what compelling reason do I have other than liability to change my corporate status from sole proprietor?  If liability is the turning point, then it is proper to ask what would you perceive your real world vulnerabilities to be in the context of your individual business?  If you need help on that, a lawyer is a better expert to ask than your accountant.  <o:p></o:p></span></p> <p class=MsoNormal><span style='font-size:11.0pt;font-family:"Calibri","sans-serif"; color:#1F497D'><o:p> </o:p></span></p> <p class=MsoNormal><span style='font-size:11.0pt;font-family:"Calibri","sans-serif"; color:#1F497D'>Further, it is appropriate to ask why good insurance coverage would not be sufficient to cover your liabilities.  You would need insurances either way, and probably to the same levels with either status.<o:p></o:p></span></p> <p class=MsoNormal><span style='font-size:11.0pt;font-family:"Calibri","sans-serif"; color:#1F497D'><o:p> </o:p></span></p> <p class=MsoNormal><span style='font-size:11.0pt;font-family:"Calibri","sans-serif"; color:#1F497D'>I think it all goes back to the KISS principle – Keep It Simple, Stupid.   Why make your business life any more complicated than it has to be?  It will definitely be more expensive every year once you have incorporated.  <o:p></o:p></span></p> <p class=MsoNormal><span style='font-size:11.0pt;font-family:"Calibri","sans-serif"; color:#1F497D'><o:p> </o:p></span></p> <p class=MsoNormal><span style='font-size:11.0pt;font-family:"Calibri","sans-serif"; color:#1F497D'>My thimbleful of knowledge comes from the my own S Corp status for the past 13 years, which is a carryover from my days as a piano dealer  with several employees.  <o:p></o:p></span></p> <p class=MsoNormal><span style='font-size:11.0pt;font-family:"Calibri","sans-serif"; color:#1F497D'><o:p> </o:p></span></p> <p class=MsoNormal><span style='font-size:11.0pt;font-family:"Calibri","sans-serif"; color:#1F497D'>Will Truitt<o:p></o:p></span></p> <p class=MsoNormal><span style='font-size:11.0pt;font-family:"Calibri","sans-serif"; color:#1F497D'><o:p> </o:p></span></p> <div> <div style='border:none;border-top:solid #B5C4DF 1.0pt;padding:3.0pt 0in 0in 0in'> <p class=MsoNormal><b><span style='font-size:10.0pt;font-family:"Tahoma","sans-serif"'>From:</span></b><span style='font-size:10.0pt;font-family:"Tahoma","sans-serif"'> pianotech-bounces@ptg.org [mailto:pianotech-bounces@ptg.org] <b>On Behalf Of </b>Geoff Sykes<br> <b>Sent:</b> Wednesday, March 19, 2008 12:47 AM<br> <b>To:</b> Pianotech@Ptg. Org<br> <b>Subject:</b> Incorporation questions<o:p></o:p></span></p> </div> </div> <p class=MsoNormal><o:p> </o:p></p> <div> <p class=MsoNormal><span style='font-size:10.0pt;font-family:"Arial","sans-serif"'>Greetings all --</span><o:p></o:p></p> </div> <div> <p class=MsoNormal> <o:p></o:p></p> </div> <div> <p class=MsoNormal><span style='font-size:10.0pt;font-family:"Arial","sans-serif"'>I have gone through the archives and found the subject of Corporations and S Corporations has come up a couple of times. But those discussions were brief and didn't really delve into the process. For a number of reasons my tax guy has strongly advised me to go the S Corporation route.</span><o:p></o:p></p> </div> <div> <p class=MsoNormal> <o:p></o:p></p> </div> <div> <p class=MsoNormal><span style='font-size:10.0pt;font-family:"Arial","sans-serif"'>Today's questions are directed to those among you who have actually gone through the process of starting a corporation and then converting it to an S corporation.</span><o:p></o:p></p> </div> <div> <p class=MsoNormal> <o:p></o:p></p> </div> <div> <p class=MsoNormal><span style='font-size:10.0pt;font-family:"Arial","sans-serif"'>: What, exactly, is the process?</span><o:p></o:p></p> </div> <div> <p class=MsoNormal><span style='font-size:10.0pt;font-family:"Arial","sans-serif"'>: Did you do it yourself, or did you hire an attorney? </span><o:p></o:p></p> </div> <div> <p class=MsoNormal><span style='font-size:10.0pt;font-family:"Arial","sans-serif"'>: Changing from Sole Proprietor to Corporation, how do you cover the question of stocks and board meetings?</span><o:p></o:p></p> </div> <div> <p class=MsoNormal><span style='font-size:10.0pt;font-family:"Arial","sans-serif"'>: What about creating a business "name" that ends in Inc., Corp., or Ltd.? To whom do your tuning clients write their checks to?</span><o:p></o:p></p> </div> <div> <p class=MsoNormal> <o:p></o:p></p> </div> <div> <p class=MsoNormal><span style='font-size:10.0pt;font-family:"Arial","sans-serif"'>I've found all the forms. And even though there are only about three really basic items being asked for on them, I find myself overwhelmed with questions and procedures regarding the process of actually acquiring and/or creating those items.</span><o:p></o:p></p> </div> <div> <p class=MsoNormal> <o:p></o:p></p> </div> <div> <p class=MsoNormal><span style='font-size:10.0pt;font-family:"Arial","sans-serif"'>So I guess my only real question is: How did you do it?</span><o:p></o:p></p> </div> <div> <p class=MsoNormal> <o:p></o:p></p> </div> <div> <p class=MsoNormal><span style='font-size:10.0pt;font-family:"Arial","sans-serif"'>-- Geoff Sykes, RPT</span><o:p></o:p></p> </div> <div> <p class=MsoNormal><span style='font-size:10.0pt;font-family:"Arial","sans-serif"'>-- Los Angeles</span><o:p></o:p></p> </div> </div> </body> </html>