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My family and I are looking to start an independent vehicle inspection co. In order to access my 401k funds and avoid heavy taxes and penalties I was advised to form a corporation. what are the advantages and downfalls of doing this verses forming an LLC or any other venue?
Thank you for any feedback and input. I'm new to this and seeking any good advice I can get.
Gale
A corporation has many advantages over the traditional sole proprietorship.
Key advantages are:
1. Limited liabilty:
If for any reason the company collapses, the members are only liable to the amount of ownership. In simple terms, your personal assets will not be attached in the evaent of inabilty to pay a debt.
2. It can sue and be sued. While there are exceptions, generally the corporation is liable for its actions and not its members
3. It can raise far more capital
4. It has better tax advantages
It has its disadvantages chief of which is that you cannot have personal control as you would a sole business. However, all in all, it is better
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