Download This PaperConverting a C Corporation into an LLC: Quantifying the Tax Costs and Benefits
Journal of Taxation, Volume 113, Number 02, August 2010
15 Pages Posted: 5 Dec 2013
Date Written: August 1, 2010
Abstract
The authors develop a spreadsheet model that evaluates the interplay of the present and future tax costs and benefits associated with the conversion of a C corporation to an LLC. The model discloses few situations where the conversion election is the better choice within a time value of money framework. This is true even when assuming that dividends are taxed at ordinary income rates.
Keywords: LLC, C corporation, choice of tax entity, time value of money
JEL Classification: K34, H21, E62, H25
Suggested Citation: Suggested Citation
Everett, John and Hennig, Cherie and Raabe, William A., Converting a C Corporation into an LLC: Quantifying the Tax Costs and Benefits (August 1, 2010). Journal of Taxation, Volume 113, Number 02, August 2010, Available at SSRN: https://ssrn.com/abstract=2363502
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