The clock is ticking for small business owners who want to take advantage of an attractive tax break this year.
The Tax Cuts and Jobs Act offers a 20 percent deduction for qualified business income from so-called pass-through entities, which include S corporations and limited liability companies.
These entities are known as "pass-throughs" because business income "passes through" to the entrepreneur on his or her own tax return, where it's subject to individual income tax rates.
Though the deduction is attractive, many business owners are still grappling with the question of whether they will qualify for the break.
Entrepreneurs also face a key decision: Should they incorporate their business to help save on taxes? If so, what entity should they select?
"Everyone wants to form an LLC," said Sepi Ghiasvand, who is of counsel at Hopkins & Carley in Palo Alto, California. "This is a time when an LLC can save you on taxes, but with a caveat."
Here are the things to consider before incorporating your business.