Business entity selections are not only important for start-ups, but also for more mature businesses. The more complex a business gets, the more flexibility may be needed in order to maximize tax savings.
Self-employment tax can be a nightmare for owners of limited liability companies (LLCs) and independent contractors. During tax season, they incur a larger than expected tax bill due to self-employment taxes. LLCs are the most common form of business because they are easy to establish. If one person owns an LLC, it is referred to as a single member LLC (SMLLC).