>>>>>There really isn't anything complicated about filing a LLC (make sure you know what the rules are in Iowa) other than filling out the state paperwork and paying the filing fees. If you have more than one partner then you need to get a partnership agreement and that is where the complexity (lawyers get big bucks) is. It is really important to keep all your personal finances separate from the LLC or a lawsuit will say the LLC was not valid and then you are personally liable anyway. Get a checking account for the LLC. Make sure that you never pay personal expenses from the LLC bank account and never pay LLC bills from your personal account. If you need to draw some money from the LLC account then just write yourself a check. NEVER take more funds from the LLC than you have profits. And last, get ready for lots of paperwork.
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>>>>>The other consideration is how taxes are handled. By default a LLC is handled like a partnership and all profits flow to the partners and the partners are subject to both income tax and self employment (SS) tax. There is an election that can be filed with IRS that will allow a LLC to be treated like a S corporation. That will eliminate the self employment tax but it means that the LLC has to pay wages which creates a bunch more complications.
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>>>>I am just curious. You said LLC has to pay wages; how else do they get paid? I have been running S corporation for 20+ years. And I pay myself wage/salary. How would it be done differently with LLC? Thank you.
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>>>LLC that has not made the S corp election just pays the partners profits as a true partnership and the partners file taxes like a sole proprietorship subject to self employment taxes.
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>>It seems to be kind of the same, still. The S corp partners/owners also pay all taxes on the personal side. I get K-1 form at the end of the year and apply it to my personal income tax.
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>Tax wise, there really isn't much difference between a S corp and a LLC with the S election. The main difference is if the S election is not filed. In this case the profits flow to the individual but the individual is subject to self employment (social security tax). For example, if the LLC makes 100,000.00 then the SE is 100,000.00 X .15. If the S election is applied then employer can pay himself 50,000.00 wages and pay SS as an employer, then pay 50,000.00 as a dividend that is not subject to SE.
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>The other advantage to a LLC is you don't have to worry about annual stock holders meetings. If you have a S corporation then make sure you keep the minutes of your annual meetings up to date. That is the first thing that lawyers will look for if you ever get sued. If the minutes are not up to date then they will sue you personally as well.
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>UPDATE: I am not a lawyer. I just stayed at a Marriott Express last night :).

They won't even let me sit down in a lobby of Marriott Express <g>. I am impressed :)

You are right about the first point that S Corp has an advantage in terms of paying less SS tax (and I do take advantage of this). As far as meeting notes, of course they are in perfect order <g>. Another thing could be that LLC has advantage. I pay state corporate tax ($456 in the socialist republic of Massachusetts) annually. I wonder if the state puts their dirty hands in the LLC owner's pockets as well.