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Comment by ohitsdom | Hacker News Reader

My biggest hesitation with Atlas is the C corp part. I don't want funding, I want to start small and bootstrap. For this, LLCs seem best so you don't get taxed twice.

My most optimistic first year in revenue would be $30-60k, still well in side business territory. Am I missing something, or is Atlas not for me?

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Keep in mind, business entities and tax classifications are different things. You can be an LLC and then elect to be taxed as a C Corp. Usually this doesn't make sense unless you need to prevent income from passing through to the owners. Apart from that, everything you can do with a C Corp you can do with an LLC (issue options, split equity, take investments, etc.), just without that double tax and administrative overhead.

In this day and age, there are very few cases where forming a corporation, taxed as a C Corp is an ideal structure for most businesses starting out.

I am replying to this because it is a question I have as well. Stripe employees - I know the Atlas page discusses the reasoning behind a C corp a bit, but I think it would be beneficial to elaborate on why it is preferable over an LLC. It’s also worth noting that the Atlas website mentions support for LLCs and other business types later down the line. Any timeline on this?

As I imagine the OP of this comment is, I am a US citizen who was primarily interested in Atlas because it seems like the most painless solution.

I highly recommend a pass-through LLC. I went C-corp with my company and I just ended up getting double-taxed over its lifetime. If you need to convert, it's easy: 1) start a C-corp; 2) acquire LLC with C-corp; 3) there is no step 3. Moreoever, if you need to convert, it's probably because you have a good reason and it's essentially a fixed-price amount (should be < $10K, probably < $5K).

I work on Stripe Atlas. Prior to that, I ran a few software businesses, all as LLCs.

A rule I had in my business was “Don’t talk about timelines until you’re ready to ship, because they only slip, and then people are sad.” I broke the rule several times, and regretted it every time. Stripe has the same rule, but is disciplined about keeping it.

I have a lot of thoughts on the C corporation vs LLC tradeoffs and while I’d love to put them in an HN comment my top task this week is putting them in a more permanent location.

the way around double taxation in a corp is paying yourself properly as an employee/director (which is tax deductible) and generally reinvest profits (with the very occasional dividend or share issuance/buyback). founder's stock is massively tax advantaged if set up correctly.

but you're right, it's not well-suited for a small business owned by one person.

If you're a solo employee in a C-Corp, I'm pretty sure you can file as an S-Corp, which provides the same pass-through benefits of an LLC. When I was incorporating and found that out, it really confused me why everyone was so against C-Corp.

Also, if you are working in California, I believe you can waive the first year of foreign franchise tax.

Isn’t incorporation fee and franchise higher with an Inc than with a LLC?

Franchise for a C-Corp in Delaware is like $175 for < 10000 shares, California foreign franchise tax can be waived for the first year.

I was in a similar situation, decided atlas was not for me. You should note as well there's a $30 monthly charge on the bank account unless you keep some large ($25k? don't remember exactly) balance. This is pretty well hidden and was enough to make me keep my LLC and free business bank account (capital one).

One of our banking partners does charge a $25 maintenance fee, waived under a few conditions (including a balance in roughly the range that you quote). We try to be pretty up-front about this; CTRL-F "Ongoing Costs" on https://stripe.com/atlas

We try to work with banking partners to put together an offering which works for the broadest selection of users, across geographies, business models, and personal circumstances. This is a perpetual work-in-progress.

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