LLC or corporation, state by state.

Neither is better in the abstract, which is why these pages compare rather than recommend. The LLC is the lighter structure: pass-through profit, few internal formalities, ownership recorded in an operating agreement. The corporation is the heavier one, and the weight is the point when there are investors, employee equity or a board involved. Most small operating businesses start with the LLC and revisit the question when the money changes.

Yes. Tax treatment and legal form are separate choices. An LLC keeps its legal structure while electing to be taxed as an S corporation or a C corporation, and the S election in particular is a common step once profit grows. The election carries timing rules of its own, so in practice it is a year-end conversation rather than something settled on the day you form.

Not to take a loan or a customer prepayment. For outside equity rounds and employee option pools, the corporation is the structure the market is built around, and investors usually expect it. Founders who start as an LLC and raise later typically convert, which is a real project: a state filing, an approval step, membership interests exchanged for shares, and a new set of corporate documents to adopt.

It changes the parts you feel every year. What each entity type owes the state, what has to be filed and on what cadence, and how the state taxes the entity are all state decisions. The federal tax picture is national. So the shape of the comparison is the same wherever you are, and the lines underneath it are not, which is what the state pages set out.

Corporate housekeeping. Bylaws to follow, a board, resolutions for decisions that matter, minutes, a stock ledger and share issuances that track who owns what. An LLC can run on an operating agreement and a bank account. None of the corporate work is difficult in isolation, and all of it is the sort of thing that gets skipped early and then has to be reconstructed during diligence.

Yes, and the route depends on your state. Some states authorize a single-filing statutory conversion from one form to the other. Others have no conversion statute and reach the same result through a merger into a new entity. Either way there is downstream work: ownership converted, new governing documents adopted, and tax filings, banking and contracts updated to point at the entity that now exists.