If you plan to form either a corporation or an LLC, you may want to consider the added advantages of forming the entity in Nevada. If you form a Nevada entity, but use it in another state, you must also register the entity in that other state. For non-Nevada businesses, using a Nevada entity does increase your costs by a few hundred dollars each year. The Nevada entity will have annual registration and other costs in two states instead of one. Partnerships Partnerships fall into two categories, general and limited.
General partnerships have no limited liability for any partner.
Lack of limited liability for all partners and owners is a major disadvantage of partnerships. In addition, limited partners have no vote or say in how the business is run. When either C, S or PSC corporations own appreciating capital assets, the appreciation accrues on the books of the corporation only, not to the shareholders. When a C or PSC corporation sells appreciated assets, it must pay capital gains taxes at the corporate level. If the remaining gain is ever passed out to the shareholders they have to pay capital gains taxes again on their distribution.