To Inc. or not

Discussion in 'Business Operations' started by jlcare, Jan 6, 2003.

  1. jlcare

    jlcare LawnSite Member
    Messages: 57

    I need a little help. I'm starting a new lawn care business this spring and can't decide on whether to Inc. or go with sole prop. It will most likely only be me this year,maybe one other emplyee, hopefully making 50,000-65,000. Know all about the liability advantages of Inc., but isn't that what Liability Insurance is for, to protect you and your personal assets? Just afraid of all the paperwork with Inc. Please give me some advice on whether it's worth it with a business this small.:blob4: :blob2:
  2. Randy Scott

    Randy Scott LawnSite Bronze Member
    Messages: 1,915

    Seek an accountant.
  3. Fvstringpicker

    Fvstringpicker LawnSite Fanatic
    Messages: 7,660

    A general rule is if you don't know why you want to incorporate, don't do it. Honestly, you really need to research the benefits and the pitfalls of incorporating a business.
  4. lawnagent

    lawnagent LawnSite Senior Member
    Messages: 531

    ok, now im REALLY wonderin. This is the 2nd post in th elast few days where someone is starting new and they plan to do anywhere from 50 to 65 grand in year one. HUH?????????:dizzy: :dizzy: I guess im really small cause I have been around a while and would almost kill to make that kind of money!:confused:
  5. The Mowerdude

    The Mowerdude LawnSite Senior Member
    Messages: 372


    I'm with you, man!!

    I really think a lot of people get into this because it holds up an illusion of there being a lot more money than there really is. Everyone I know, around here, is convinced that I'm really cranking the big bucks and, since I don't have a new truck/house/car or nice wardrobe, I must really be pissing it all away on lord only knows what. I'm finishing up my 12th year, and I'd like to have 50 grand after everything else has been paid.

    One of the biggest problems is when the employees become convinced that I'm making the big bucks. That's when they all stop working.
  6. MN Wildwood

    MN Wildwood LawnSite Member
    Messages: 80

    Jlcare- Starting off new and trying to gain customers & keep those you get is a lot harder to do than you might think. It is possible to GROSS over 50-60 grand, but out of that comes all you inusrance, gas, repairs, equipment purchases or loans payments, etc. I made just over 60 this year and when all was said and done I have 1/4 of that left. I am still in college however and so I can only expand as fast as I have open time.
  7. Tony Harrell

    Tony Harrell LawnSite Senior Member
    Messages: 739

    Are you going to do turf applications? There's more risk there. Although, even DowAgro is just an LLC. Hard to say. Speak to someone personally, like an accountant or an attorney.
  8. walker-talker

    walker-talker LawnSite Platinum Member
    from Midwest
    Messages: 4,771

    I would suggest staying sole prop for at least the first year. Would not make sense wasting the money going inc. until you get the business. I would highly suggest getting general liab. insurance though.

  9. trookard

    trookard LawnSite Member
    Messages: 2

    I'm new to this board, but I have done a fair amount of research about incorporating and the like. I would not set up as a corporation yet due to the simple fact that you may be under the illusion that your personal assets will be protected magically by the corp. In truth, for the protection to be in place, you MUST elect a board of directors, have meetings, keep corporate minutes, file necessary paperwork, and a host of other activities that you may not want to fool with. If even one of the necessary activities are not properly fulfilled, the courts can declare the corporation never truly existed and that will leave you open again for liability purposes.

    My family owns a small business in northern louisiana and i have been trying to convince them to become a LLC. The LLC will provide them with the protection that they need and doesn't require the everyday operation of the business to change significantly for their line of business. .

    I am not telling you that you would be better off as an LLC, but it may be another avenue that you may want to check out. For me, I will be starting my business this year and will start off as a sole-proprietership with plenty of liability insurance. After I get off the ground, I may check into the LLC option. I'm not sure exactly how the LLC option will work for the grass business here in louisiana.
  10. rodfather

    rodfather LawnSite Fanatic
    Messages: 9,501

    Invest an hour of your time with a good business attorney. They will/should be able to tell you whether or not to incorporate now or in the near future.

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