<prompt> Human: So I currently reside in New Jersey, I will be working in New York, I will be working a 1099 job and many people have told me that for tax purposes it smarter to create an LLC and be taxed under the corporation. However no one has been able explain why...please help make sense of this for me reddit!  <response>: 1 create LLC2 have LLC elect with the irs to be taxed as an s corp use form 88323 cut yourself a salary that is reasonable based on the industry of business. The lower the salary the better for tax purposes. If its too low the irs will disallow below4 any net income over and above your salary can be taken as a shareholder distribution and will thereby bypass self employment taxes 15.3This is the primary way to avoid tax with an LLC. 