Covina, CA asked in Business Formation, Business Law and Construction Law for California

Q: Would forming an LLC or Corporation be better for a person who wants to start their own General Contracting Company?

I want to become a first time business owner and was wondering which would suite me the best in terms of taxes, protection, and future costs? I am planning to elect to file taxes under S-Corp subsection for either of these business entities that I am willing to go with.

2 Lawyer Answers
James A. Greer
James A. Greer
Answered
  • Construction Law Lawyer
  • Boulder, CO
  • Licensed in California

A: Dear General Contractor with "entity formation" question: You asked which type of entity formation would be the best in the state of California for a company intending to operate as a licensed General Contractor under the auspices of the Contractors State License board ("CSLB"). The CSLB does not "acknowledge" the use of an LLC in holding a contractors license. Therefore your election to Bec one an S-Corp would be permissible. JIM GREER is an attorney licensed to practice in CA and CO and has specialized in construction, business, and real estate matters for the past 35 years; nothing herein shall be construed as the offering of legal advice insofar as Mr. Greer is not in an attorney-client capacity with the inquiring party. 858.481.9006

Shawn R. Jackson
PREMIUM
Shawn R. Jackson pro label Lawyers, want to be a Justia Connect Pro too? Learn more ›
Answered
  • Rohnert Park, CA
  • Licensed in California

A: The answer to your question should be developed in an initial free consultation by video call or telephone call. The short answer is ... it depends" ... upon your preferred management structure, the operations plan, your succession plan ... and how well you get along with others ...

Justia Ask a Lawyer is a forum for consumers to get answers to basic legal questions. Any information sent through Justia Ask a Lawyer is not secure and is done so on a non-confidential basis only.

The use of this website to ask questions or receive answers does not create an attorney–client relationship between you and Justia, or between you and any attorney who receives your information or responds to your questions, nor is it intended to create such a relationship. Additionally, no responses on this forum constitute legal advice, which must be tailored to the specific circumstances of each case. You should not act upon information provided in Justia Ask a Lawyer without seeking professional counsel from an attorney admitted or authorized to practice in your jurisdiction. Justia assumes no responsibility to any person who relies on information contained on or received through this site and disclaims all liability in respect to such information.

Justia cannot guarantee that the information on this website (including any legal information provided by an attorney through this service) is accurate, complete, or up-to-date. While we intend to make every attempt to keep the information on this site current, the owners of and contributors to this site make no claims, promises or guarantees about the accuracy, completeness or adequacy of the information contained in or linked to from this site.