"Etienne" <etiennevb[at]hotmail.com> wrote:

- quote -

Instead California has professionals create LLP's, limited
liability partnerships. As far as I'm aware, for all
practical purposes they are the same.

- quote -

California has a minimum income (or franchise) tax of $800
per year. But that also applies to every other entity other
than general partnership and sole proprietorship.

- quote -

Have a conference with your tax professional and your
business attorney, who can evaluate your exact circumstances
and determine what will work best for you.

Stu

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Both my spouse and I are employed, but we are starting to
provide some business services on the side for small
businesses, such as creating websites, IT support, writing
business plans, etc., as independent contractors.

I would expect these services to provide an annual income of
approximately $25k, on top of our $150k joint salary income.

I was told that to maximize tax benefits, I should form a
partnership with my spouse, so that we are able to deduct
expenses we make to provide these services.

I was wondering which exact partnership structure would be
best. General partnership, limited liabilty partnership, or
limited liability corporation.

The LLC seems atractive because of the liability protection,
but we live in California, and according to state law,
professional service companies cannot have the LLC
structure.

I was wondering if we would be considered a professional
service company.

A`bout other options, (such s C-corp), I have read ugly things about the flat
professional service corporation tax rate....

Anybody any tips, input or guidelines, or can someone point
me to an information source that can tell me exact
guidelines for being considered a professional service
provider or not?

Much thanks,

Etienne

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