I need help!!!!
Two years ago two other partners (Americans) and I (a Canadian) started a company in the U.S. We all put thousands of hours into the business and just now are finally starting to see some sizable profits. This may sound completely silly and naive but up until now, the business was an LLC with only one member (one of my partners), although we all considered ourselves one-third owners and trusted that we'd work out the legalities later. Now we are actually looking to legally include all three of us in the business through either a three-member LLC, an S-Corp or a C-Corp. We spoke to a local accountant and he recommended an S-Corp. We went to a lawyer filled our the paper work to incorporate and now the accountant has come back to us and said that a Canadian can not own part of an S-Corp (information which would have been useful BEFORE we went to the lawyer!) So now he's saying we must stick with a C-Corp and forget the election to form an S-Corp.
Here are my questions?
1) Is it true that a Canadian cannot own an S-Corp?
2) Can we/would we be better off adding two members to our current one-member LLC, considering I am not American.
3) How is the company suppose to pay me?
4) Will the company have to withhold tax from what they pay me (and I will have to claim the foreign tax credit on my Canadian return), or can I apply for an exemption so they don't withold and pay my tax in Canada?
5) Would it be wise for me to personally hold shares/membership in a Corp or LLC, or would it be better for me to incorporate in Canada and have my corporation hold these?
6) What would you do if you were in my shoes?!
Sorry if any of these are silly questions or if they have already been answered. I searched the forum and could not find answers as specific as I need to go forward with a confident solution. I appreciate any help that anyone can give. Thanks!


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