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    S, C or LLC for home based Travel Agency
    So here is my Question. I am going to start a new home based business of Travel Agency. I want to show my brother as my partner. What type of Corporation S,C or LLC is most suitable for this type of business and why. I did lot of research and still can't seem to make the decision. Anyone out there who knows anyone in this type of business.


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    I am interested in seeing the response to this. I am thinking about registering my home-based writing business as an LLC. I think it depends on how many people you plan on having work for the company and what your overall goals are.


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    It really depends on the size of your company. If you are only composed of a few incorporators and it is a family business a limited liability corporation would be good specially since you have limited liabilities on certain aspects.


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    The LLC is a legal concept, and it can be taxed multiple ways. You said you want your brother to be shown as your partner, that means you will have multiple owners, or so called “LLC Members”
    Since you will have multiple owners, your LLC taxation choices are:
    • Partnership (Default for multiple member LLCs)
    • C Corporation (You have to file an election form to be taxed as a C-corp)
    • S Corp (again, you have to make an election for this, you only have 75 days from the formation of the business, or the first 75 days each year)

    An S-corp strategy could be beneficial, because you save on social security and medicare taxes, BUT you will have to do payroll for yourself, and for your brother. (In addition to the regular profit distributions.) So there are expenses related to having an SCorp, but overall you could end up saving money with this strategy.

    I would suggest talking to somebody about your specific circumstances. I’ve seen people start out with an LLC, taxed as a partnership (no payroll requirements), and as they grew, they had the option to elect to be taxes as an SCorp.


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    This is not an advice. I only tell you what I would do, if I were you. I see many people getting into complicated company arrangements before they figure out what they really want or need. This is a start up and you don't know how it will turn out. I would start as a simple partnership and buy professional liabilities insurance for partners. These are really cheap to arrange and you probably need it in any case. This covers any claims against you because you were negligent in your work or you made a mistake (say when you were booking a holiday for someone).

    Before the next tax period you can have a look at your business and decide which option you want to go and which type of company suits you. Generally, starting a company cost you more in terms of accountancy fees and it may not make sense if you are not turning over enough in your business. Again, this is what I would do. Maybe you have worked it all out and you know exactly how successful your business is going to be and how much money you will make.


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    Last edited by TCI; 04-17-2014 at 04:26 AM.
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    Quote Originally Posted by ravibbb View Post
    So here is my Question. I am going to start a new home based business of Conejo Tourism . I want to show my brother as my partner. What type of Corporation S,C or LLC is most suitable for this type of business and why. I did lot of research and still can't seem to make the decision. Anyone out there who knows anyone in this type of business.
    Hi
    your decision is right and you need LLC.


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    Quote Originally Posted by ravibbb View Post
    So here is my Question. I am going to start a new home based Conejo Tourism, Tourism in conejo valley. I want to show my brother as my partner. What type of Corporation S,C or LLC is most suitable for this type of business and why. I did lot of research and still can't seem to make the decision. Anyone out there who knows anyone in this type of business.
    Hello
    If you are an experienced traveler with a background in sales and/or travel booking and you are looking for opportunities to work from home, consider starting your own home-based travel agency. The travel industry is a strong economic sector, but travel booking is also a service many people would rather perform themselves. Running your own travel agency from home comes with a unique set of challenges and perks, so before jumping in, make sure it's the right move for you.


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    Ravibbb,

    The answer to your question depends on a lot more variables than the information you're providing. Some states, it's better to choose one over the other and it mainly has to do with taxes and formalities.

    There are more restrictions and formalities with a corporation and for a new, home-based business, an LLC may be the better option in terms of the paperwork required to comply with state and federal regulations.

    Still, there are several things to consider. Here's a resource from the IRS website with more detail. https://www.irs.gov/businesses/small...ess-structures

    Stay away from Sole Proprietorship and General Partnerships as these entities allow for unlimited liability, thus putting your livelihood at risk.


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