TAX ADVANTAGES
Corporations and LLCs can take advantage of tax savings options that are not available to sole proprietorships or partnerships. For example, corporations can establish pension, profit-sharing and stock ownership plans, which can lower the corporation's taxable income. Medical, life and disability insurance premiums are also completely tax deductible for corporations. In addition, a corporation can own shares of stock in another corporation and receive 80 percent of the dividends tax-free.
