Should I form a Company or a Corporation

[s***@yahoo.ca]

Hello,

I'm interested in forming either a LLC or a corporation. My main
reason is to protect my personal assets, but here's what I have been
told of these two entities:

Corporations are a popular business entity, but many people have turned
to forming LLCs as they can provide flexibility and convenience.
Corporations require that regular shareholder meetings. An LLC does
not have this requirement, so people with busy schedules often form
LLCs.

Is this the only difference? Will both entities provide me the same
level of protection? Which one is better for which situation?

Thanks...

PS: I'm planning to sell products via the internet...that's my main
purpose for this company.

[John A. Weeks III]

Post by s***@yahoo.ca
I'm interested in forming either a LLC or a corporation. My main
reason is to protect my personal assets, but here's what I have been
Corporations are a popular business entity, but many people have turned
to forming LLCs as they can provide flexibility and convenience.
Corporations require that regular shareholder meetings. An LLC does
not have this requirement, so people with busy schedules often form
LLCs.
Is this the only difference? Will both entities provide me the same
level of protection? Which one is better for which situation?
Thanks...
PS: I'm planning to sell products via the internet...that's my main
purpose for this company.

The illusion of "protection" by being a LLC or Corporation is largely
a myth for a small business. Any good lawyer can blow right through
your veil of protection in court. Any rational vendor is going to
make you sign personally for any credit that they extend. And if
you are a one person shop, you are still personally responsible for
any thing that you do yourself, so while the business might not get
sued, you can personally get taken out.

Your best bet is to make sure that you have the proper insurance,
and a good umbrella policy. Then worry about doing business. If
after a few years the business amounts to anything, and you need
to start hiring people, then get with a good lawyer, accountant,
and tax guru and figure out the right business structure.

The key is to never hire employees unless you have some kind of
protections. All it takes is for one employee to pinch another
employee on the butt, and you have a huge, expensive mess. That
is probably the biggest risk as you grow.

-john-