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Old 04-17-2014, 08:48 PM
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T Scapes T Scapes is online now
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sole prop to LLC

i think im at the point where i need to switch to an LLC? Are there any major benefits for taxes for loans or anything along those lines
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Old 04-18-2014, 02:22 AM
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not really.

there;s a lot of misinformation about LLCs.

The main reason for one is to separate "Bob Smith" from NatureScape LLC.

If you've got dozens of employees running around and one backs over the prized German Shepard worth 2 gazillion dollars with a backhoe… It's NatureScape LLC that gets sued not Bob Smith… This is whats referred to as 'the corporate veil"

Tax wise, LLC, Sole Prop can be nearly identical, or different, depending on what your want to do.
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Old 04-18-2014, 03:02 AM
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Actually, LLC is not recognized for federal tax purposes. In other words, if you're a sole proprietor that changes to an LLC, you'll continue to file a schedule C to report your business income.
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Old 04-18-2014, 09:57 AM
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Quote:
Originally Posted by Cat 320D LRR View Post
i think im at the point where i need to switch to an LLC? Are there any major benefits for taxes for loans or anything along those lines
Have you considered an S corp, or LLC electing to be taxed as an S corp? Talk with your accountant - savings to be had on how distributions are taxed vs self employment tax.
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Old 04-18-2014, 10:00 AM
whiffyspark whiffyspark is online now
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Doesn't matter when you're solo
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Old 04-18-2014, 10:04 AM
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Doesn't matter when you're solo
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What doesn't matter?
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Old 04-18-2014, 10:05 AM
whiffyspark whiffyspark is online now
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Llc sole prop etc.

Only thing that makes a difference is incorporating
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Old 04-18-2014, 10:14 AM
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Llc sole prop etc.

Only thing that makes a difference is incorporating
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Still not following you?

He never said he was solo and there can be tax advantages even if he is. Different rules in different states - get advice from your accountant.
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Old 04-18-2014, 10:17 AM
whiffyspark whiffyspark is online now
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I said if he was solo it doesn't matter. You're still paying income taxes on the same amount. When you're solo it's YOUR money lol
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Old 04-18-2014, 10:38 AM
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Still not following you?

He never said he was solo and there can be tax advantages even if he is. Different rules in different states - get advice from your accountant.

IT all depends on how you report it, sometimes it's best one way or best the other way.

an LLC gives you a choice, Sole Prop doesn't. Ironically most LLCs report and pay taxes exactly like a sole prop.
But this is mainly due to people mistakenly thinking LLC makes them 'legit' over a sole prop.

The reasons for going one way or the other are entirely as varied as the discussion on charging X/hrÖ. it's all specific to the individual company/owner.

There CAN be tax advantages in certain cases, but there usually isn't for small fry's.
The ones who are big enough for it to make a difference, aren't on here asking this question
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