Choosing Your Entity — Sole Prop, LLC, or S-Corp (Book + Operator Toolkit)
Should you stay a sole proprietor, form an LLC, or elect S-corp status?
Most advice answers with a rule of thumb. This book shows you the whole calculation, so you can make the decision for your own state, your own numbers, and your own risks, and walk into a CPA's office already knowing which questions matter.
What's inside the book (208 pages, US Letter PDF + EPUB):
- Part One — What an entity actually does: legal form vs. tax treatment, what the liability shield covers and where it stops (including AI-assisted client work), and the real yearly cost of keeping an LLC alive.
- Part Two — Six Decision Files: six fictional people in Ohio, Texas, California, New York City, Washington, and Florida reach six different right answers, from a side business while still employed to an S election that had to be undone.
- Part Three — The math: self-employment tax, how an S corporation really works, reasonable compensation, the break-even, and the interactions most comparisons leave out: QBI, retirement limits, health insurance, and state and city taxes.
- Part Four — Doing it: forming step by step, keeping the shield intact, electing and running payroll, bringing in a second owner, handling notices and disputes, and setting up books and records with AI.
- Part Five — Beyond the US and beyond this year: Canada, UK, Australia, EU, and Asia notes; a yearly review routine; and a template for writing your own Decision File.
- Appendices: glossary, 32 common questions, a 50-state + DC LLC fee table, toolkit sample pages, and primary sources.
Updated for 2026 rules, including the end of FinCEN beneficial ownership reporting for US companies, the permanent QBI deduction, the $2,000 1099-NEC threshold for 2026 payments, and California's $800 LLC tax with no first-year waiver.
The Operator Toolkit ($44 version) — 13 files, ready to use:
Every file has a filled example (a fictional consulting business) and a blank version for yours.
- Quick Start (your first 30 minutes)
- Entity Decision Calculator — compares sole prop/LLC vs. S-corp across three profit scenarios, with QBI, payroll costs, and solo 401(k) limits
- State Cost Lookup — 50 states + DC, with a state worksheet
- Reasonable Compensation Worksheet + memo
- Compliance Calendar (exportable to your calendar)
- Owner Draw & Separation Log
- Single-Member LLC Operating Agreement (Word + fillable PDF)
- S-Corp Accountable Plan
- Annual Written Consent
- AI-Use & Liability Addendum for client contracts
- CPA Question Brief
- My Decision File
- AI Prompt Library — 20 prompts written for the tasks in this book
Who it's for: adults in their 30s to 50s building a one-person business with AI help: consultants, designers, writers, analysts, coaches, and specialists who are still employed, recently laid off, running a business with a spouse, or being told to "become an S-corp."
Please note: This is education, not legal, tax, or financial advice. All examples use fictional people and hypothetical numbers; they are not predictions or promises of results. US rules are primary, with notes for other countries. Figures are current as of October 2026.
Digital download. No physical item will be shipped.
