Going to be chatting up a lawyer next week, wanted to have a better understanding of a couple issues prior to that.
Background: in CA, doing financial planning and investment mgmt. I wanted an LLC but the same lawyer was pushing incorporation instead. In CA, both have to pay an $800 minimum corporation tax when registering.
1. Anyone know if the $800 is waived in the first year? I'd thought I'd heard that...
2. Assuming I incorporate and elect an S-Corp, all profits and losses should pass through - so in other years what happens to the $800 minimum corp tax? Is it still paid, but a credit in the pass-through? Or a sunk cost?
3. Not knowing how much I'll earn, especially in the first 3-5 months, how do I handle my salary? Do I just change it monthly as I know how that month will close? Or draw a VERY small salary and just give myself large quarterly bonuses (maybe monthly bonuses?)
4. I'll be the only employee as well as the owner. Since I'm an employee, do I really have to get, and post, the EEO & other notices to be in compliance with federal law?
5. Anyone have a realistic idea of the time/dollar/effort impact of Inc. vs. LLC? Lawyer said it wasn't much bother, but wondering how many extra hours I'll spend worrying/doing the extra incorporated activities per year?
Thanks to all, even if you can only answer one of these. Appreciate your time!