As a tax consultant I have set up many S-corps, LLCs and Sole Props. In working with lawyers they generally say that if you are the one doing the work and therefore responsible for any damage, you can be held personally liable. This is not legal advice, just my experience. If you have employees I recommend you look into an LLC or corporation for the liability protection. For tax purposes, the S-corp is generally better if you set it up correctly.
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