Hello, I have some business questions that I want to get some answers for and was hoping you could help. My dad and I started a restaurant about a year and 2 months ago. We opened it as a sole proprietorship under his name. I however do all of the legal/tax/business end of things while my dad cooks. We make a really good team and have started to grow the business pretty well. At first I just put myself on payroll like the rest of the employees and then took myself off payroll right before I thought I was going to leave the company to go do my own thing. Turns out I couldn't find anyone to replace what I was doing and my dad was/is not capable of taking care of the business side of things so I decided to stay and make this my career. That being said, we now need to decide what to do with me legally since I am going to stay. I'm still not on payroll and my dad is just paying me cash until we decide what to do. Here is what we are considering: 1. Put myself back on payroll and just pay taxes as a regular employee 2. Form an LLC with my dad and I as officers. (I know about the protections this provides, but I don't know the tax side and that is the main reason for asking. I also know about the yearly 800 dollar franchise tax for California.) 3. Form a Partnership with my dad and I My main question is this: Which would be the cheapest for my dad, the business and I for taxes and other fees? When I was on payroll, I paid a large amount of taxes out of each check and so did the business. Would this not be the case if it was a partnership or an LLC? Are there any taxes that I don't know about for income that the business needs to be paying? I'm obviously new at this and could really use the legal advise. Thank you very much and have a nice day!