Going legit

Discussion in 'Lawn Mowing' started by MImowerkid, Jan 12, 2005.

  1. MImowerkid

    MImowerkid LawnSite Member
    Posts: 197

    I am almost 16 years old and I have had my lawn service for almost 5 years now . It has always been a cash or check operation with no insurance or corporation established. I would really like to take the next step and become a corporation so I can feel safer and advertise that I am fully insured (I will be seeking insurance).I have been reading into the subject and I would like to know if I have everything right .#1I have to get a DBA at a county courthouse . My mom or dad will do this for me because I do not believe I can being a minor. Next step is to open a business checking account once again my parents will probably have to do this for me. So now I will have to become a type of corporation , and from what I have read the most common form of this for a single person going into the lawn care business is the sole Proprietorship. My parents would be personally responsible for any loses, so a good insurance policy would be most needed.For insurance it seems like CGl is a commonly used policy and also BOP . which ones would you suggest? I think I would like the options of the BOP because it covers a more wide spectrum. then after all of that is set up I mow till my heart is content then taxes come around and that is another post! so the question I am asking is is my process set up right? any other advice? I would seek professional help with the insurance but how do I go about setting up the S Corp? thank you for your valuable time and I look forward to becoming another member of the No Scrubs Society ! Thank you for all of your help again guys! -Christopher Jodoin
  2. newbomb

    newbomb LawnSite Senior Member
    Posts: 391


    You are correct. As a minor you will not be able to do most of what you mentioned unless a parent acts as the responsible party. If one of your parents is willing to do this you still open a can of worms. I am all for legitimate operations but if I were you I would wait till I could do it myself. If your parent is the responsible party, they will be involved in much of what you do. They will have to write the checks negotiate contracts ( commercial accounts will not contract with a minor because they can be held to the contract but a minor (you) can walk away at any time), and be responsible to the IRS. If one of your parents is the Responsible party they will be responsible to pay taxes on all of the declared earnings. This might upset the delicate balance of tax returns. Many little details to remember if you do this now.

    What I would do at your age is:

    Build a solid reputation in the residential market. Learn all you can. Save as much money as you can Invest in your business wisely. (you can learn a lot right here). Expand your services and operation as best and wisely as you can. As a minor your tax responsiblity is minimal. You may not be required to file a tax return unless you do very well. (BETTER CHECK ON THAT). Focus on learning all you can and decide what you really want out of this business for now. When your 18 (if you want it) go legit and go like hell. Learn all you can now. P.S. Get some college too. A good business education is invaluable regardless of what you do.

    Best of luck to you -Paul
  3. MImowerkid

    MImowerkid LawnSite Member
    Posts: 197

    staying the way I am now is something I am considering very much I just get a little worried if I (knock on wood) ever hurt somebody , break a window , or give someone a heart attack when I broke their window , I want to covering my butt . I just want to play it safe. Most likely I will have over 30 customers next year and I think the costs involved with taxes , insurance ect. as well as the inconvience involved with my parents will be well worth it . I also think that I can have alot of expenses that I could write off , and I am willing to put forth the money for taxes. I am not excited to do it , but I think the benifits outweigh the added expenditure . I have been turned down before for not having insurance, and I have large commercial buisness lined up that I can take just with a few signing of legal papers. I would love to continue my education at collage , either in buisness or in turf management. and I would love to keep my buisness and possably become a part time firemen .thanks for the advice and I look forward to more info . keep it coming guys!

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