LLC with a JV

So I'm currently in the process of setting up a very ambitious JV with another member on here. If we did half of what I think we can do it'd still be amazing volume. We're talking about alot of money (it's going to be very tempting to really scale up entirely). Until recently my best day at all was $120. That's changed and I'm now consistently way above that with only a very small scale. For that reason alone I was planning on setting up an LLC with S type taxation.

Now my JV partner is located in the same state (FL). So I was thinking of doing the LLC with it's own tax id and wiring him the money weekly (or to his business) as a business expense (split is 50 50).

Now I'm wondering if this is the best way to transfer him the money so that we could both avoid taxation or if there's a better way. Without the LLC I'll be paying taxes on all of it so that's obviously just stupid. Would it be smarter to have it as a salary (but then there's unemployment taxes) or pay him dividends (but he's not an investor and doesn't own a share in the LLC) or just stick to it as a business expense and suggest that he set up his own LLC to avoid taxes on his end.

Lots of questions in here and it really deserves a complex answer...

To get you started here are a few things you need to know. If you set up an LLC you will be drawing money from the company and will be taxed on any earnings on your personal tax return. An LLC is a flow through entity so any profits or losses "flow through" to the owners.

An S Corp on the other hand you would need to draw a salary - this is an IRS requirement. If you and your partner had $100.00 per year in profit (obviously it will be much more!!), then reasonably you would draw 60% or so as salary, likely 30% each. This would be paid for via regular payroll paid for by the S Corp. The balance of 40% could be taken as a distribution and you and your partner will alleviate FICA and self-employment tax.

Since it sounds like you both will be making some decent coin, I would recommend spending a few bucks, going to see a business entity attorney, and getting his/her advice on which entity best fits your situation. That way the attorney can understand your personal situation, set up the LLL or S Corp for you, and you can rest easy! The whole thing won't cost more than $1200 or so. Many places will do it for much cheaper but that seems to be the high mark.

Anyway, good luck to you and your business!!