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Permalink Reply by otto on April 9, 2009 at 8:26am

I agree, consult with an accountant...and set up some kind of LLC, family trust or F.L.P.
family law partnership...their are pro's and cons to all..but, one will fit your needs...and protect what you have...

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Permalink Reply by Charlie on June 25, 2010 at 5:05pm

Incorporating alone will not necessarily save you in paying less income taxes. The IRS normally finds a way to get its "pound of flesh." The primary benefit of incorporating is liability protection (i.e. the separation of personal assets and business assets). Your corpoate creditors would only be able to reach the assets within the business.

There are several tax advantages you may receive by incorporating, including the opportunity to take advantage of business deductions and in certain cases the elimination of self-employment tax. However, these savings are not assured and you must account for the annual filing fees, extra tax returns/tax prepartion fees and other addittional documentary procedures you will have to follow.

As far as estate planning, an FLP might be an option to reduce potential estate tax due. But, this option is not for everyone, and should only be recommended to person who have enough assets which will expose them to potential estate tax upon death (note: in 2010 there is no estate tax and for 2011 individuals with over $1 million in assets will be subject to the tax).

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Permalink Reply by AJ Amatore on June 21, 2011 at 11:23pm

I disagree in consulting with an accountant-that term is too general. You should consult with someone with a specific background in the various tax issues concerned here. A professional tax planner and there are darn few around should be your first stop. After all does Uncle Sam really need to be your business partner in this endeavor? You might want to google the "American Institute of Tax Coaches" to find a specialist in your area.

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