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Comparison5 min read
Compare S corporation vs LLC: differences and benefits
S corps and LLCs both offer unique advantages and limitations. Learn the key differences.
Overview
LLCs and S-Corps are both pass-through entities for tax purposes, but they're structurally very different.
LLCs and S-Corps are both pass-through entities for tax purposes, but they're structurally very different.
Quick contrast
LLC: flexible ownership (US or non-US), simpler maintenance, taxed as sole prop, partnership, or corporation by election.
S-Corp: shareholders must be US persons, stricter formalities, but can save on self-employment tax through reasonable salary + distributions.
For non-US founders, an LLC is almost always the right answer.
Frequently asked questions
Next step
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Delaware C-Corp or Wyoming LLC — formed in days, not months.
