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The landscaper
12-12-2005, 02:54 PM
Has anyone switched the business from sole prop to a LLC?

If so, what do I need to do to switch over. Also, as the a LLC I will have a partner if that makes any difference in the process.

MacLawnCo
12-12-2005, 03:49 PM
partner will make it an LLP.

lawnsbyrj
12-12-2005, 06:18 PM
talk to an accountant, a real CPA not a tax preparer. my guy handeled most of it for me i just had to register my Company name.

MacLawnCo
12-12-2005, 06:22 PM
why the hell do people think an accountant is skilled in forming legal entities. That is NOT our jobs. You will need a lawyer for this if you do not want to do it.

landtastic
12-12-2005, 06:29 PM
Word, that advise is woth some money MacLawn.

jasonnau
12-12-2005, 06:38 PM
$60.00 per hour for my accountant.

lawnsbyrj
12-12-2005, 09:40 PM
Mine is much cheaper than that he printed the papers and it all cost me $100 so hey what ever

MMLawn
12-12-2005, 10:08 PM
Mine is much cheaper than that he printed the papers and it all cost me $100 so hey what ever

Then your not an LLC.....cause the LLC filing fee alone in NC is $125.00 and then a yearly $200.00 fee.

and "all" the papers is only 1.5 pages that can be downloaded for FREE directly from the NC SOS website.

Green-Pro
12-12-2005, 10:22 PM
I would check YOUR states regs/laws. These will vary from state to state, for instance here in Iowa its a one time filing fee of ( can't recall but I believe) $50 to register and be recognized as an LLC, incorporation requires yearly renewal, both require articles of incorporation be filed with the Sec. of State.

Here is the link for Ohio Sec. of State website, really shouldn't be that difficult of a task to handle yourself. I met with my CPA to gain more insight from a tax standpoint what business entity would best serve our purposes. This year was extremely good, over the next couple of years we will make the determination whether to incorporate or not.

Heres the link: http://www.sos.state.oh.us/SOSApps/SOS/FormRefbs.aspx/

A lot of these fellas are right a good CPA is IMO a must to consult with and I did, but I also did a helluva lot of research on my own, paperwork on my own and saved myself some money there.

The landscaper
12-12-2005, 11:16 PM
I believe I can have a partner and still be a LLC. You can have as many as you would like and they are called members, not partners at that point.

What exactly are the articles of incorporation?
Does anyone have an example of a partnership agreement I could take a look at. I don't want to leave anything out of it.

Green-Pro
12-13-2005, 09:28 AM
I believe I can have a partner and still be a LLC. You can have as many as you would like and they are called members, not partners at that point.

What exactly are the articles of incorporation?
Does anyone have an example of a partnership agreement I could take a look at. I don't want to leave anything out of it.

Check your S.O.S. website from the link I posted Articles of Incorporation are required in Iowa, not sure if this applies to other states, some, none, or all.

I found an example of these on our S.O.S. website and just copied, cost to me? Nothing, zip, some folks around here actually hire somebody to write these for them at anywhere from $100 to $300 a pop!

Articles of Incorporation are merely a legal document filed with the S.o.S. that basically states when and where your company was formed, who the principal owner/owners are, are they the registered agents, blah, blah, blah. Here is a copy of what we filed as an example, remember this is in Iowa, Ohio, in fact most states laws/regulations vary on this. I really think you should check the website link I posted, it will spell things out for you as it pertains to Ohio, in great detail. I realize the document says Articles of Organization, Articles of Incorporation and Organization are one in the same.

Cooper725
12-13-2005, 09:31 AM
We are switching on Feb 1st of '06. A buddy of mine is a laywer\accountant and for $241.50 everything was taken care of.

lawnsbyrj
12-13-2005, 09:41 AM
Then your not an LLC.....cause the LLC filing fee alone in NC is $125.00 and then a yearly $200.00 fee.

and "all" the papers is only 1.5 pages that can be downloaded for FREE directly from the NC SOS website.


my mistake he charged me $125 to take care of it and make sure it was all ok. and yes teh $200 for the yearly but I was stricktly talking about set up.

LB1234
12-13-2005, 10:54 AM
partner will make it an LLP.


ahhhh really?

Just wondering why you are stating this?

Our LLC is comprised of two 'members' each with an equal share. We received a 1065 - U.S. Return of Partnership Income, NJ-1065 - Partnership Return, and a schedule K-1 - Partner's Share of Income, Deductions, Cedits, etc. This form basically states that each of the partners, or members gets a 50% share of profits, losses, and capital.

Perhaps it is differnent in other states...just curious.

The landscaper
12-13-2005, 11:38 AM
I am planning on making it a LLC with two members. I am pretty sure I have the same 1065 with the k-1 as well.

LB1234, do you have an example of your partnership agreement i could look at for ideas?

TWUllc
12-13-2005, 06:29 PM
ahhhh really?

Just wondering why you are stating this?

Our LLC is comprised of two 'members' each with an equal share. We received a 1065 - U.S. Return of Partnership Income, NJ-1065 - Partnership Return, and a schedule K-1 - Partner's Share of Income, Deductions, Cedits, etc. This form basically states that each of the partners, or members gets a 50% share of profits, losses, and capital.

Perhaps it is differnent in other states...just curious.

I am in business in Maryland. My company is a LLC. Our structure is a Partnership. I am signed as legal owner, while my mother is signed as a partner, just incase anything happens to me. I own 99.99% of the company. My mother owns 0.01%. Plus, its better on taxes, (says my accountant). My company is still an LLC.

MacLawnCo
12-13-2005, 07:33 PM
Just wondering why you are stating this?
Because that was my understanding.

LB1234
12-14-2005, 11:51 AM
Sorry, I can't give you a copy of my partership agreement. Same reason I won't hand out a sample of my contract. I'm not trying to be a jerk, I just don't agree me spending the money on all the books, all the hours of reading, not to mention the $395/hr my attorney charges me, and just ship it off. Again, sorry.

I can tell you however, what is in it. I pulled this out of a few different books that I have. I would go to your library or local bookstore and just start reading. Jot down everything that is/you think will be relevent to your partnership. Then just start typing away. I believe some of the 'Nolo' books have CD's in them with samples you can download right to your computer. I think they are b/t 20-30 bucks.

The biggest thing is for both partners to write up an agreement and then make sure you can mesh the two together. Both sign off on it. Then take it to your attorney and have him change the common everyday jargon into legal crapola that will hold up in court...hopefully you will never get there.

Give me a minute and I will post a pic of some books I have used as a reference guide. I have a lot more of the 'Nolo' books (which a highly recommend BTW) but a friend of mine who is starting up a service business has been using them.

LB1234
12-14-2005, 12:03 PM
Here a pic in pdf.

The landscaper
12-14-2005, 06:28 PM
Yeah, I understand where you're coming from there. Not a big deal. I am looking around on the net here trying to find examples, I just don't want to leave any parts of it out. Better be safe than sorry I guess.

Are there any other things I should check into as well. such as insurance, bank accounts, things like that, that may have to be adjusted because of the switch.

Thanks

LB1234
12-14-2005, 10:12 PM
Yeah, I understand where you're coming from there. Not a big deal. I am looking around on the net here trying to find examples, I just don't want to leave any parts of it out. Better be safe than sorry I guess.

Are there any other things I should check into as well. such as insurance, bank accounts, things like that, that may have to be adjusted because of the switch.

Thanks

You are going to have to contact your bank and fill out some paperwork if you want this partner to be able to sign checks and drawn money from the account. You may also want to contact your credit card company. Mine allows me to give credit cards to employees and set there 'level'. In other words, they do/don't have the ability to raise the credit card limit, can draw cash from card, etc.

The landscaper
12-16-2005, 11:55 AM
I don't use any credit cards. I just have a cash and check kinda credit card at the bank. I will just have to take care of that while in there.

Do I need to change my insurance around at all and insure the entity rather than myself?

LB1234
12-16-2005, 03:10 PM
You really need to speak with your insurance agent. I'm assuming (big assumption) no, provided your company name hasn't changed.

sgallaher
12-27-2005, 08:47 PM
I switched over from a sole proprietor to a LLC this past year. Delaware is one of the best states to incorporate in. Most of the major companies in the world are incorporated in DE, (Disney, most credit card companies, etc) I did everything online at www.bizfilings.com I forget the exact cost but it was around $200 or so. They filed all the paper work with the state and are acting as my registered agent. I filled out the paperwork with the IRS for my EIN but they can do that too for more money. You don't have to live or work in DE to be incorporated in the state, and you don't pay DE tax either. DE is the best because they have the laws that work for the corporations.