LLC vs LLP?

[N1C0L3]

I already know the main differences between LLCs and LLPs but I am trying to reassess if switching will be in the best interest of my business. I started the business with my boyfriend after we graduated college and we registered as an LLP. From the looks of it an LLP seemed better for two people starting a business together who wanted to be equal partners. Upon filing for taxes last year we realized that when your business is an LLP your business' income is actually taxed twice, once for each partner. Would we be paying less in taxes if we switched to an LLC? Through my research it seems like there are a few extra fees that LLC's have to pay throughout the year..? It seems like if you are an LLC it is best to file your taxes as an S-Corp to avoid being taxed twice, LLPs don't have this option. In terms of two people, who want to be equal partners in a business do you guys have any advice for what type of business will be best for us? Has anyone switched from one to the other? I also would like to know, in terms of personal liability if your business fails, is there one that would better protect our assets?

 

[KmH]

You really should consult with your attorney and accountant, not online, because the issues vary by state and individual circumstance.