LLC, S Corp, or Hot Mess? How to Choose the Right Entity Like a Boss
Let’s have a heart-to-heart. Filing your LLC is cute and all, but do you really know what that means? I’ve seen too many brilliant entrepreneurs throw around legal terms they saw on TikTok—meanwhile, their businesses are one step away from tax penalties, lawsuits, or just plain chaos.
Choosing the wrong business entity is like showing up to the Met Gala in Fashion Nova. You’ll make a statement—but probably not the one you were going for.
This post will walk you through the differences between an LLC, S Corp, and C Corp, and help you determine which one fits your goals, your structure, and your tax situation.
First Things First: Why Your Entity Type Matters
Choosing the right business structure is about more than getting an EIN or looking official. Your entity determines:
How you’re taxed (and how much you owe)
Whether your personal assets are protected
How investors see you
What kind of contracts you can sign
Your legal responsibilities and liability
You don’t want to be making six figures but still operating like a sole proprietorship. That’s not legacy. That’s liability.
The Main Contenders
Let’s break it down real simple:
Sole Proprietorship
✔ Easiest to start.
❌ No liability protection. You and your business are the same legal entity.
❌ Doesn’t look great to investors.
Limited Liability Company (LLC)
✔ Offers liability protection.
✔ Flexible management.
✔ Pass-through taxation.
❌ Can be confusing if you don’t set up an Operating Agreement or elect how to be taxed.
S Corporation (S Corp)
✔ Potential tax savings via payroll.
✔ Still offers liability protection.
❌ More rules: must pay yourself a "reasonable salary," can’t have unlimited shareholders.
C Corporation (C Corp)
✔ Great for raising money or issuing stock.
✔ Can keep profits in the business.
❌ Double taxation (business profits + your salary/dividends).
❌ Complex paperwork and compliance.
Real Talk: Which One Is Best for You?
Here’s a quick cheat sheet based on your goals:
Just getting started and want protection? Go with an LLC. It’s easy to manage and protects your personal assets.
Making over $60k/year and want to save on taxes? Consider electing S Corp status (after forming your LLC).
Planning to get investors or build a startup? You might want a C Corp, especially if you’ll raise funds.
But don't make this decision without guidance. A one-size-fits-all answer could cost you thousands.
Mistakes I See ALL the Time:
Forming an LLC and thinking you’re done. Nope. You need an Operating Agreement, an EIN, and often, a business license.
Choosing S Corp status but not running payroll. That can flag the IRS. Pay yourself like an employee.
Not consulting legal or tax advisors. Google can’t save you in court.
My Story: From Confusion to Clarity
When I launched my first PR firm, I was so focused on marketing that I forgot to structure my business. One client refused to pay—and I had no contract, no entity, and no leverage. Lesson learned. Now? Every client signs a custom agreement under my LLC, and I’ve saved thousands in taxes with my S Corp election.
Entity + Tax = Your Secret Weapon
Did you know you can form an LLC and later elect to be taxed as an S Corp? That’s the legal game you play once your revenue hits a certain threshold. It can save you on self-employment taxes—but only if you set it up right.
Here’s how I help my clients:
Evaluate their revenue and business model
Structure their LLC or Corporation based on their growth goals
Coordinate with their CPA for tax optimization
Draft custom Operating Agreements and contracts
This is legacy-building work. Because when the IRS comes knocking or a client gets froggy, your legal foundation is what keeps you secure.
The Legal Toolkit Makes It Easy
If you’re reading this like, “Domonique, I don’t even know where to start,” I got you. The Legal Toolkit walks you through the step-by-step process of choosing, setting up, and protecting your entity.
Or better yet—
CTA: Book a legal formation consult now at GoPriceLaw.com. Let’s choose the right entity like a boss and build something that actually lasts.