Should I setup my LLC to be taxed as a C-Corp? How can I avoid paying taxes pre-revenue since there is no revenue?

 

This question does not provide sufficient information. The best way to handle this would be to discuss your projected financials with a CPA for the first 3–5 years.

A short answer to your question, converting from S to C Corporation is relatively easier, less time consuming and low-cost solution, Converting from LLC to Inc - C Corporation involves a lot of accounting, tax & compliance work.

If you are doing mobile development and just starting out, it will be a while before you start generating enough revenue to withdraw salary from your business and profits. Any VC or investor will evaluate your business potential and model before investing. This is assuming this is your first business.

Also, if you are not generating any revenue, will you be in a loss situation? If so how long? When will you break even or generate profits?

Many situations, we come across when S Corporation would have been a better choice than C corporation. So, it is difficult to give a generic answer here.

 

*** Our response to a question posted on quora.

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Posted In: Company Formation

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