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Switching over from Sole Propitiator to LLC Question

Discussion in 'Starting a Lawn Care Business' started by chumiller22, Nov 5, 2007.

  1. chumiller22

    chumiller22 LawnSite Member
    Messages: 9

    I have started my Lawn care service company this fall doing fall cleanups and Acquiring customers in the Northwest Indiana region for next years mowing season, things are moving along pretty good. I had two nice sized commercial properties drop into my lap, which prompted me to form my company. I have almost everything in place thanks to Shawn and the great ppl on this Site.

    I have my business plan togetherÂ…liability insurance, my website is going up in days. I have my business cards, flyers all made up and I am working on my marketing approach for the spring as we speak. I plan on getting my chem. license this winter from Purdue so everything is falling into place.

    I started out as Sole Propitiator but I think a better business move would be for me to switch to a LLC. Its not that expensive to do this in Indiana. Besides just switching over and filing with the state is there any other things I need to do in order to switch? Some of the things I was thinking do I need a new EIN number? What about informing my insurance company? And if I do switch over do I always have to list on everything along with my name LLC?

  2. landscaper22

    landscaper22 LawnSite Senior Member
    Messages: 849

    Chumiller, sounds like you have everything in order. Glad to see you carry liability insurance, and are working toward your chemical license. I can't answer all of your LLC questions, but I know you have to list everything with your name on it with LLC after it. I'm sure your insurance company would need to know. A lawyer is what you need. I know of other people besides lawyers that can write up an LLC, but a lawyer knows all the ins and outs, and all the legal loop holes, etc.. The lawyer should be able to answer most any question you have about LLC. It may cost a little more, but you know you have someone to fall back on, if you ever get sued.
  3. BLKSS

    BLKSS LawnSite Member
    from Texas
    Messages: 82

    your gonna need a lawyer, i think it should cost around 1500 for him to do it all.
  4. chumiller22

    chumiller22 LawnSite Member
    Messages: 9

  5. bohiaa

    bohiaa LawnSite Fanatic
    Messages: 5,220

    according to my info you dont need a lawyer.

    but being fairly new to the business, I would wonder why you would want to do this.

    the only benifit I can think of is to get it out of your name, meaning so you wont be responsable, the co. would be.

    also I have seen many times new businesses geting into trouble doing this before they know all the in's-and out's of it....

    mainly the moneys will no longer belong to you, as it would be with just a DBA.
    misapproperate of funds is a bad thing.

    you being the only employee, you would have to carrie insurance on yourself.
    or rather the co. has to carrie insurance on you.....meaning workers comp.
    around here it's 600.00 a month......

    a good tax man can prepair this for you, and he can also inform you of most of the rules.....

    Just be sure to do ALL your research before doing it.....

    and by all means dont take my word for it nor anyone elses from this site only.

    make sure to get the rules in writting......

    Good luck
  6. TekLawn

    TekLawn LawnSite Member
    from Indiana
    Messages: 3

    You are absolutely doing the best thing for yourself by going to an LLC. I am in the same boat as you at this stage. If you were to stay a Sole Proprieter, you run the risk of too many negatives. I have heard horror stories of guys losing their homes, Familys, and credit. Insurance definately helps, but you want your personal finances and "name" to be protected.

    I am located in Central Indiana close to you and here is what I have thus far.

    No Business License needed in Indiana
    Completey Insured
    filed my company name through the County Recorder
    company name registered as an entity like $80 or so
    got my EIN from the IRS
    Will be going to Purdue also next spring
    working on web-site as we speak
    gearing up for success

    Just where I am at thus far...
  7. jbannick18

    jbannick18 LawnSite Senior Member
    Messages: 490

    About Workers comp.... You can exempt yourself from it, atleast you can here in FL. I'm a sole prop and as long as I don't have more then 4 workers I don't need to worry about it. Atleast that's what i have read
  8. landscaper22

    landscaper22 LawnSite Senior Member
    Messages: 849

    You don't need a lawyer...but I'm telling you it would be extra money well spent...If you use a website, or CPA, or someone else, and you ever have a law suit against you, you can't run to them for help. The prosecution lawyer will rake you over the coals, and if they find anything in the LLC paper work that is a mistake or otherwise not correct, your may be toast. Get a lawyer that knows all about the laws and how to protect you to draw it up. Then if anything comes up you can be at the lawyer's office asking questions....These other guys can't do much for you...Just MHO....
  9. chumiller22

    chumiller22 LawnSite Member
    Messages: 9

    Thanks Guys,

    The advantges to a LLC are pretty plain and simple your taxed like a sole prop. on your personal income taxes. All LLC owners are protected from personal liability for business debts and claims the "limited liabity" This means that if the business owes money or faces a lawsuit for some other reason, only the assets of the business itself are at risk. Creditors usually can't reach the personal assets of the LLC owners, such as a house or car.

    Lawyer and a CPA are good things to have...I agree, and I will look into both, id never try and rep myself in court?? thats just plain crazy...the workmen comp issue? Im not sure I understand what your talking about, I dont think we need to have it in Indiana, heck they dont even make Us have a Business Lics. Again thanks guys,

    Yooo Teks We are kinda in the same boat as far as start-up companies goes, if youd like to exchange emails and keep up with each other, talk shop sometimes I could give you my Email address...Be kinda cool to know someone at the Purdue Class this Spring. let me know what you think.

    Chuck Miller
  10. TekLawn

    TekLawn LawnSite Member
    from Indiana
    Messages: 3

    right on!! not sure how to pm on here. you?

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