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Hello, About a year ago I left the videogame industry and partnered up with a friend to tackle a new form of making income, as a freelancer paid royalties per sale by a company for assets we created for their videogames. While it started off as a relatively modest source of income, we've had some great luck on getting a lot of content in and our royalty rate has increased our income compared to respective years by about 400-500%. Considering all this income that's pouring in, and the current amount of tax I'm paying under self employment (About 30%, Texas) as we haven't incorporated-I was wondering if it would be a good next step. Considering that we are only 2 people at the moment, I've heard that certain categories can create additional tax burden and hassle for a startup. I'm looking for any advice as to what category could provide a proper transition for a startup and potentially cut our taxes down as we continue to grow. As of now it seems like an LLC and C class might be the best way to go, but I think the best advice could come from Goons who have actually gone the route rather than the dime a dozen 'business advice' websites I've been researching.
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Oct 21, 2014 00:56
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Consultant your CPA/attorney about which would best fit your needs but it will probably be an LLC. You might go S-Corp later if your CPA/attorney advised it. Unless you have outside investors, I really don't see any reason to go C-Corp.
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Oct 21, 2014 02:06
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