Legal Question in Business Law in New York
LLC vs. Sole Proprietorship
I am an acupuncturist practicing in Kings County, Brooklyn, New York. I am an independent contractor and am told that I need to incorporate for tax benefits. My question pertains to forming a single person limited liability company in health care. As I am a health care practioner, I need to know if LLC's in health care are legal in New York. What are the legal pros and cons of forming a single person LLC versus a sole proprietorship? What kind of protection can an LLC offer as opposed to a sole proprietorship? My accountant advised me that a sole proprietorship would be simpler as far as taxes are concerned, so I'm wondering if an LLC would be worth the extra paperwork.
1 Answer from Attorneys
Re: LLC vs. Sole Proprietorship
LLC s are legal in New York. It costs about $500 to form in Kings County.
A sole proprietorship and LLC are almost identical for income tax purposes.
A LLC will shelter you, individually, from the personal payment of liabilities incurred by the LLC., except for those debts which a statute imposes on you (malpractice, etc.).
Very little down side risk with an LLC but there is an intial cost and annual tax.
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