This is not true for many reasons, primary among them being taxes and healthcare.
I'll explain taxes below. For healthcare, I use Trinet as an HR provider (since I am a company) and they allow me to get benefits (including healthcare) at corporate rates. You need to be incorporated for them to even talk to you.
> I'm not exactly sure what you mean by this, but LLCs are pass through entities for tax purposes.
Happy to explain. When you are self-employed, you pay SECA taxes on your entire income.
https://www.investopedia.com/terms/f/fica.asp
For self-employed, that means both the employer and the employee portion. Let's say you pull in 300k. You're going to pay SECA taxes on all of that.
If I create an LLC, do an S-corp election, then retain myself in the LLC for say 50k, I will only pay those taxes on the 50k. The other 250k will be passed through to my personal income and I will only be responsible for the standard income taxes.