if an individual opens a small business would it be better to do it as a inc. or a LLC. for ins. and taxes?

LLC is easier compared to incorporating

1. Taxation. The LLC is a pass-through tax entity. This means that the income or loss generated by the business is reflected on the personal income tax return of the owners.

A C corporation is a separately taxable entity. The profits and loses are taxed directly to the corporation. This can lead to double taxation on dividends that are paid out of corporate profits to the owners.

2. Formalities. A corporation requires that certain formalities be followed. The corporation must hold annual meetings of shareholders and directors each year, and meeting minutes must be kept with the corporation¡¦s records.

LLCs are not required to hold such meetings; however, it is a good idea to document major decisions of the company and hold regular meetings of members.

It would be better to do an Inc. i.e. a corporation in your state and then do an Sub chapter S election.

This would help in terms of taxes and allow pass through you income directly to your tax return. Also, you don't have to do payroll if you are the only employee.

You can also do a single member LLC, and then choose S election.

Some states do treat LLCs as partnership and therefore make you pay some taxes each year even thought you don't make any money.

sole proprietor is better less paper work to deal with less legal issues.

It depends on your state laws!@~