Legal Roleplay: LLC, C-Corp, or S-Corp?

LLC vs C-Corp vs S-Corp: How to Choose the Right Business Structure Choosing the right legal entity is not just about paperwork, but it is also about defining the future of your business. In this special Roleplay episode of Letters of Intent, Pankaj Raval and Sahil Chaudry simulate a real client consultation to demystify the complex world of entity selection. Pankaj plays the role of a physician launching a high-growth sober living company, while Sahil plays the corporate attorney guiding him through the maze. They break down the critical differences between LLCs, C-Corps, and S-Corps, explaining why Phantom Income can ruin an LLC owner's year, how the MSO structure allows for investment in healthcare, and why C-Corps are the only real choice for venture-backed scale. In this episode, you will learn: The MSO Solution: Non-doctors generally cannot own medical practices. To scale a healthcare business with outside capital, you often need a Management Services Organization (MSO) to separate the business operations from the clinical work. Phantom Income: In an LLC (pass-through entity), you are taxed on the profit allocated to you, even if that money stays in the business account. This Phantom Income can create a massive tax bill with no cash to pay it. C-Corps for Growth: If you plan to raise venture capital, issue stock options to employees, or reinvest earnings heavily, a C-Corp is usually the superior choice despite double taxation. The QSBS Goldmine: Founders of C-Corps in qualified industries (not professional services) who hold stock for 5 plus years may be eligible to exclude up to 100% of their capital gains upon sale under Section 1202. S-Corp Strategy: For profitable small businesses and professional service providers not seeking venture capital, an S-Corp election can save thousands in self-employment taxes once income exceeds around $150k. ► Listen to Letters of Intent's other episodes: bit.ly/LOIPodcast ► Visit Carbon Law Group's Website: carbonlg.com Connect with Us: ► Connect with Pankaj: [  / pankaj-raval  ](  / pankaj-raval  ) ► Connect with Sahil: [  / sahil-chaudry-6047305  ](  / sahil-chaudry-6047305  ) ► Schedule A Call With Us: carbonlg.com #CarbonLawGroup #EntitySelection #CorporateLaw #SmallBusinessTips #VentureCapital Carbon Law Group, Los Angeles, Los Angeles County