S Corp or LLC

Discussion in 'Starting a Lawn Care Business' started by rickster, Aug 18, 2006.

  1. rickster

    rickster LawnSite Member
    Posts: 9

    Just trying to get some feedback from some of the Pro's on the pros and cons as you have seen it. I am just in the process of trying to develop my marketing and business plan and register with the state. I know I could call a lawyer and accountant and get their perspective but was looking for some practical feedback of what you have experienced.

    Also, I know the "It all depends on your situation" reply, and I will make my decision when the time comes. But I'm looking for a little brainstorming on the subject.

    Thanks in advance, I've been reading daily for about 3 months. I have learned and laughed a lot.

    Rick
     
  2. rickster

    rickster LawnSite Member
    Posts: 9

    Surely somebody has some thoughts on this. Please.:help:
     
  3. ed2hess

    ed2hess LawnSite Fanatic
    Posts: 13,328

    I'll bump you along but I have little information. I ran a part time business for many years without forming a corporation. The main reason I didn't was the cost of the lawyer and accountant. When we started to do the work full time we wanted to limit our liability and reduce our taxes. Thus we got both a lawyer and account. Hindsight says I probably gave away a lot of money to the IRS that I didn't need to and took a huge risk in liability even though I had insurance. Go pay the $1K or so and get professional advise when you get started.
     
  4. Equinox Lightscapes

    Equinox Lightscapes LawnSite Member
    from CT
    Posts: 15

    You'll be doing yourself a favoe by lettting a lawyer set it up for you. If you file the papers yourself, you still leave holes that can be connected to your personal libality. My lawyer helped me to close these and totally isolate the business.

    P.S. Luckily I was referred to a great lawyer that is also a great person. He was excited for me to start my journey in business and was glad to be a part of it. I felt he gave me and the process the attention it deserved and didn't treat it as "just another LLC start-up."
     
  5. rickster

    rickster LawnSite Member
    Posts: 9

    ed2hess and Equinox Lightscapes,

    Thanks for the input. Absolutley, lawyer and accountant. Great advice, already have them on board. Just wondering which way did folks here wind up, LLC or S Corp? Any particular reason for one over the other? I have read tons of stuff on various web sites telling the general advantages of each.

    Anybody else? Please.

    Rick
     
  6. Equinox Lightscapes

    Equinox Lightscapes LawnSite Member
    from CT
    Posts: 15

    Lawyer decided LLC for me, gave me a brief explination (60 seconds) and that was it. I trust him throughly so I really didn't care to remember the "why" part.
     
  7. parkeeee

    parkeeee LawnSite Member
    Posts: 227

    I spoke to an accountant who advised since it would only be myself, to start as a sole proprietor.

    Everything has worked out OK so far. IMO

    :weightlifter:
     
  8. FATWEASEL

    FATWEASEL LawnSite Senior Member
    from NC
    Posts: 326

    For what it's worth, I was steered towards an S Corp by my attorney. He informed me that he has also taught business law for the past 20 years. That doesn't mean he knows everything but I do value his opinion as I had this very discussion with him for about an hour not too long ago.

    Most of what he told me rattled around in my head a while and then turned to jelly. :laugh: The part that I do remember was that S Corporation lawsuits had been fought in court thousands and thousands of times over and that rulings had been established as many times.

    On the other hand, he said that he would, from time to time, see cases involving LLC's, where a precedence had not been established which is not too good when you're being sued.

    He said that I would probably be fine with whichever I picked but if it were up to him he would go with an S Corp.

    Hope this helps!:drinkup:

    Andy
     
  9. Dunn's

    Dunn's LawnSite Bronze Member
    Posts: 1,534

    go with an LLC if you fail and your business goes under. It will cost alot of money to close up as s-corp, that you won't have because you failed, just saying this because alot of guys get in to this business thinking it is easy moeny then find out it isn't and buckle. Hope this helps.
     
  10. RHayden

    RHayden LawnSite Member
    Posts: 123

    Main reason we went with an S corp was employment tax benefits (for me) and future stock ownership/profit distributions (for my brother and cousin and maybe key employees) when I begin to fade away.
     

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