Operating losses are taxed once as if realized by the shareholders. Despite the tax advantages, the S Corporation has limitations on the number and type of shareholders. The Company may not have more than 75 shareholders and may only issue common stock. And, as mentioned above, non-resident aliens can not be shareholders. These limitations on shareholders mean that the S Corporation is an imperfect vehicle for public offerings.
Taxes pass through to the principals and the company's earnings are only taxed on one level.
The L.L.C. may make a lot of sense at start up, but because it is taxed like a partnership, it is not suitable for a public offering. In addition, there are tax disincentives that discourage the use of stock options as a method of compensating employees. This, of course, is a very brief rundown of the different form of corporate organization. They all have effects on immigration in addition to the issues discussed above. We can help you with establishing yourself in business as well as achieving your immigration goals.