I'm interested in forming two business entities:

Business Entity A - This would be for investing into real estate, specifically, rental properties.

Business Entity B - This would be an online retailing company. All the development work would be outsourced & for the first year or two, I don't expect to see much revenues, if any.

My situtation - Currently I'm working full-time with a telecommunication company & am on a H1 visa. I intend to keep my current day job. And because of the immigration laws, I can't be self-employeed by any of these two corporations/LLC.

So my questions are:

1. In case of Entity A (RealEstate), can it operate without any employees? Ofcourse I would be doing some voluntary work. Would IRS accept this?

2. Entity B (Online Retailing), I'm starting this along with my brother who is an American citizen. Can this business also operate without any employees during the first year of its operation? The first year (maybe two) is the development phase & all the work is outsourced. So as such there is no need of having any employees during this phase until we start generating revenues.

3. What kind of business entity should each of these be? Corporation or LLC? For corporations, it can only be C because for S, all shareholders need to be citizens or residents. So the choice is between C-Corp & LLC.

4. If I do form a LLC, can it be changed to a C-Corp after a year or two?

5. In case of Entity A (RealEstate), I've heard that there won't be any tax on the profit made by selling a property if the profit is invested in buying a bigger property. Is that correct?

Thanks for reading my post. Hope to hear from you.