LLC vs Inc vs Sole Proprietor vs WTF...

YouDontKnowMe

YouDontKnowMe

Loki
Apr 18, 2010
520
8
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USA
Alright, so I'm a total noob when it comes to corporate structure and business law and other stuff like this.

Up to this point in my life, I've been paying and receiving all money in my personal name. However, now that I am earning and spending more on IM, I want to set up an "official business".

I went to LegalZoom, and found a shit ton of options. I searched online to read about them, and I'm still confused as fuck.

Bottom line:

1. I will be the only person involved in business (no employees or partners) for the forseeable future.

2. I don't need anything to fancy or complicated. Just want to keep personal and business finances separate. This is for tax and legal reasons.

3. I want minimal hassle and headache with accounting and taxes. I have Quickbooks online. I'm currently deadling with 5-figure revenues and expenditures annually.

Any advice would be very much appreciated. Thanks.
 


I used LegalZoom as well. I went with a sole proprietor system since really what I wanted was the Sales Tax ID. Looking back now, I probably would have went with the LLC. Not only does it look more professional but you have better seperation between your personal belongings and your business belongings. Meaning, if you ever get sued with an LLC, you probably won't lose your house over the deal.
 
Honestly from the criteria you listed, I think operating as a sole propietor would be best. An LLC is definitely the easiest business entity to manage other than being a sole propietor, but it still requires more work than being a sole propietor.

If you want to keep a separation between your business and personal finances, I'd just recommend opening a credit card and bank account that you will use solely for your business ventures.

Just my opinion.

An LLC will give you *some* liability protection but there are of course many exceptions.

Start here: LLC Basics - Free Legal Information - Nolo
 
your LLC means almost shit if filed online thru the state. Have an attorney file it for you that specializes in it.

Online reg thru state most times dont include "other" documents that will help you look more legit if you get into trouble.
 
by other documents i mean something legit like the operating agreement, etc... which most states DO NOT include in their filing.

Get sued and produce just an Articles of Organization and see how fast you get man handled.
 
Lawyer up, dude- and LLC it all the way for IM. Hands down the easiest way to admin it, and if you select the "Partnership" option, it's like having a sub-s corp which treats profits as personal income with no double taxation.

It should cost you about $1500 total initially, and then around $500 a year (in Illinois, anyways, which is an expensive filing state) and it's the cheapest insurance you will ever buy for your business and family.
 
legal zoom is an ass rape and they should be shot for misleading people. you need an attorney, and in most cases for a small business incorporation, you can go S corp, and I am giving you free advice thousands of dollars later. and make sure you really need a corp. because in states like Cali they collect $800.00 a year just for the privilege. the system is rigged and not in your favor.
 
eliquid said:
also go all out and get some E&O and a personal umbrella just in case, youll be pretty tight for sure then.
Click to expand...

What exactly do you mean by "E&O" and "personal umbrella"? English is my 2nd language so some of these abbreviations don't make sense to me.
As for an attorney...just google them up? Or is there a better way to get a reliable one?
Same question for finding a reliable accountant. Oursourcing?
 
I agree with the most of the comments here. We have owned sole prop, LLC, as well as a C corp.

Sole prop is the easiest however you are low hanging fruit for anyone that decides they want to sue you for any silly ass reason. With a LLC at least your personal life and assets are shielded from these kinds of abuses. C corp is a major hassle for paperwork and forms. In some cases it makes sense but for most I think an LLC is the best options.

Good luck
 
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