IRS audit risk of differing types of entities
Unincorporated businesses which are often filed as a Schedule C inside your personal return are often 10-15 times as likely to be audited for the same type of deduction, as if it were in a corporate or a Sub S company or Partnership return. Thus if you have a business, consider forming a LLC and electing a Sub S form of entity. It will save you money even though there are costs of filing annual tax returns.
