Uber has never once turned a profit, and is allowed to continue running their business. If you’re a small business owner running an ebay or ecom business, and you claim losses for 3 out of 5 years in a row, it’s likely that the IRS will audit you, and could deem you a hobby. Amazon is often cited as not generating a profit for many years, but is now profitable. For them, it was somehow okay to run a business making no profit! So like, how come small businesses can’t claim losses, but big corps can?

  • lemmyman@lemmy.world
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    2 months ago

    Yes there is a difference, but LLC is a legal concept, not a tax one. The IRS taxes sole proprietors the same whether or not they have an LLC.

    Tax entities include sole proprietorship (default), partnerships, s corps, c corps. Any of those can be LLCs, but they don’t have to.

    • FireTower@lemmy.world
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      2 months ago

      Yes the main appeal of a LLC is that you aren’t liable if your LLC gets sued. As a sole proprietor if someone slips and falls in your store they can recover damages from you personally. As an LLC they can only get the business’s funds.

      This means that even if awarded damages from a civil case tanks your business your won’t be out of a home and your personal bank accounts are safe (not considering the burden of lossing your source of income).