LLC vs. S-Corp vs. C-Corp · Construction Entity · Tax Structure · Liability Protection
LLC · S-Corp · C-Corp · Construction Entity Structure · Tax Planning · Liability
Construction Entity
Structure.
Entity structure affects taxes, liability protection, bonding capacity, banking relationships, and your ability to bring in partners or sell the business. Most construction subcontractors chose their entity structure when they started without fully understanding the financial implications. Here's what each structure means financially — and the questions to take to your CPA and attorney.
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SPM vs. Other CFO Firms
Most CFO Firms Serving This Trade
- High revenue minimums — most won't serve under $5M
- Advisory only — no bookkeeping, no implementation
- No job costing setup or ControlQore management
- No monthly WIP as standard deliverable
- No pricing published — discovery call required
- No vetted partner network for bonding, lending, or liens
- No prevailing wage specialty
The Construction CFO — SPM
- Serves $1M–$12M — starts at $1,900/month
- Full implementation — bookkeeping, job costing, CFO advisory
- ControlQore setup and managed for you every month
- Monthly WIP standard in Executive tier
- Full pricing published — no discovery call to find out costs
- Vetted partners for bonding, lending, lien services, payroll
- Prevailing wage and Davis-Bacon specialty
What We See in This Business
01
You Chose Your Entity Structure Without Understanding the Financial Implications
Most construction businesses start as sole proprietorships or LLCs by default. The entity structure that made sense at $500K in revenue has different implications at $5M. Self-employment taxes, distributions vs. salary, and liability protection all change as the business grows. The entity structure you have may not be the one that serves you best now.
02
Entity Structure and Bonding Can Conflict
Sureties evaluate the financial strength of the bonded entity. If you operate through multiple entities without a well-structured holding arrangement, bonding agents may struggle to evaluate your true financial position. The entity structure that's optimal for taxes may not present the strongest financial profile for bonding.
03
You Don't Know If You Should Convert
The most common question SPM gets about entity structure: 'Should I convert my LLC to an S-Corp?' The answer depends on your current revenue, your salary vs. distribution mix, your payroll tax exposure, and your CPA's analysis of the tax savings vs. administrative cost of the S-Corp election. It's not a universal yes — it's a financial analysis.
How SPM Fixes It
LLC — The Starting Point
A single-member LLC is a pass-through entity — all profits and losses pass through to your personal return. Simple to maintain, no corporate formalities required, and provides liability protection. At lower revenue levels, the self-employment tax on all net income is the primary downside. No distinction between salary and distributions — all net income is subject to self-employment tax.
S-Corporation — The Common Growth Move
An S-Corp election (applied to an LLC or corporation) allows you to split compensation between salary (subject to payroll taxes) and distributions (not subject to self-employment tax). The tax savings can be significant at higher revenue levels — but require a 'reasonable salary' that the IRS will accept, actual payroll, and more administrative overhead. Coordinate this decision with your CPA — the breakeven revenue level where S-Corp saves more than it costs varies by situation.
SPM Coordinates With Your CPA on Entity Structure
SPM doesn't provide tax or legal advice — entity structure decisions belong with your CPA and construction attorney. What SPM does is ensure the financial management systems work correctly within whatever entity structure you operate — including multi-entity structures with equipment LLCs, operating companies, and holding entities. We also ensure the financial presentation to your surety accurately reflects your entity structure.
Service Tiers
Tier 01
Core Financial
Starts at $1,900 / month
- ControlQore setup and management
- Job costing aligned to your estimate structure
- Cost-to-complete tracking — updated monthly
- Full-service bookkeeping — minimum 30 min/week
- Vendor payments via ACH (you approve, we initiate)
- Accounts receivable management
- Bank reconciliations and transaction matching
- Controllership
- 1 monthly CFO meeting
- 60-day onboarding — books migrated to last taxable year
Most Popular
Tier 02
Executive Financial
Starts at $2,900 / month
- Everything in Core Financial
- Monthly WIP schedule — delivered every month, standard
- 13-week cash flow forecasting
- CEO Report — monthly financial dashboard
- 3 CFO advisory meetings per month
- Strategic accountability and actionable to-dos
- Direct access to Josh Luebker
Pricing by Revenue
Revenue Range
(Last 12 Months) |
Core Financial
Monthly |
Executive Financial
Monthly |
| Under $1M | $1,900 | $2,900 |
| $1M – $3M | $2,600 | $3,600 |
| $4M – $6M | $3,800 | $5,500 |
| $7M – $9M | $5,100 | $6,900 |
| $10M – $12M | $6,100 | $8,500 |
| $13M+ | Quoted | Quoted |
Vetted Partner Network
National Lien Services
When AR gets too long, we connect you directly to our lien services partner to protect what you've earned.
Additional cost — not included in monthly fee
Payroll Integration Partners
Prevailing wage and regular payroll software partners integrated directly with ControlQore job costing.
Additional cost — not included in monthly fee
Bonding Partners
Surety relationships and bonding capacity support. We prepare the financials — our partners get you bonded.
Additional cost — not included in monthly fee
Lending Partners
Working capital lines and equipment financing through vetted lenders who understand construction.
Additional cost — not included in monthly fee
Reviewed Financials
CPA-level financial statement reviews for banking, bonding, and large contract requirements.
Additional cost — not included in monthly fee
CPA Coordination
We work alongside your existing CPA — not replacing them. Clean books and job costing make tax time easier.
Included — no extra cost
Common Questions
Straight answers.
Should I have a separate LLC for my equipment?
A separate equipment LLC can provide liability protection for valuable equipment, create cleaner equipment cost tracking, and potentially offer some tax planning flexibility. The downsides are administrative complexity, intercompany accounting requirements, and potential bonding complications if sureties can't clearly see the consolidated financial picture. This is a decision for your CPA and attorney — SPM handles the financial management for whatever structure you implement.
How does entity structure affect my ability to sell the business?
Significantly. Asset sales vs. stock sales have different tax treatment that varies by entity type. S-Corps and LLCs typically offer more flexibility in transaction structure than C-Corps. The entity structure in place years before a sale affects what deal structures are available and what the net proceeds look like after tax. If selling the business is a possibility in the next 5–10 years, entity structure should be reviewed now — not when you have a buyer.
What's included in Core Financial?
ControlQore setup, job costing aligned to your estimates, cost-to-complete tracking, full bookkeeping (minimum 30 min/week), ACH vendor payments (you approve, we initiate), AR management, bank reconciliations, transaction matching, controllership, and 1 monthly CFO meeting. Starts at $1,900/month.
What does Executive Financial add?
Everything in Core plus monthly WIP schedule, 13-week cash flow forecasting, CEO Report, and 3 CFO advisory meetings per month. Starts at $2,900/month. WIP, cash flow forecasting, and the CEO Report are Executive tier only.
Do you handle payroll?
No. We have vetted payroll software partners — including prevailing wage integrations — that connect directly with ControlQore. Those are separate engagements at additional cost.
How long does onboarding take?
60 days. We migrate your books to the start of your last taxable year, set up ControlQore, and build your job costing structure. Fully operational in two months.
What software do clients use?
ControlQore. All SPM clients run on ControlQore for job costing and WIP. We set it up and manage it — you don't have to learn it. Clients switching from QuickBooks, Sage, or other platforms migrate during onboarding.
Do you work alongside our CPA?
Yes. We work alongside your existing CPA — not replacing them. Clean books and accurate job costing make their job easier at tax time.
What happens when we grow past $12M?
We have a clear graduation path. We prepare your financials, systems, and team for the transition and connect you with the right firm for your next stage of growth.