Incorporated [or] Sole Proprietor ?

[high impact]

Best protection and tax benefits for us is incorporation and then file as sub s. Great liability protection IF you keep your books up to date! Watch the LLC...your not as protected as some think (according to my attorney). If you have an INC and haven't filed a dba also with the name you publicly use then make sure your INC is EVERYTHING. I have a LLC with a realestate company and works good but dont like it as well for a retail business.

Sold assets and name rights on a dba and kept the corporation alive a couple of years ago and it worked great...kept tax benefits and when we wanted to reopen to public we just filed our new address for tax collection and dba with the state...now it's a breeze to set up vendors, loans, certifications, etc...because we have "been in business" (incorporated) for 4 years.

Spend a couple of beans and talk to your attorney and CPA - in other words - "do your homework"...you'll be glad you did. I would NEVER operate as a sole proprietor knowing what I now know and seeing the liability and tax benefits.

-Mark

 

[scene329]

if you're making over 35k a year profit then Id switch over to incorporated if I were you. There are some more tax advantages as well as a few other perks

 

[signsource1]

I currently have both an S-corp and an LLC two different companies. Two different purposes. Think of an LLC as a SP with a certain corporate level of asset protection and a S-corp as a higherlevel of protection. Both have tax advantages and disadvantages. With an S-corp you are only liable for what you have invested and what the company is worth.

I think that is how it was explained to me

 

[Border]

This is a good thread and has me thinking it's time to step up from being a SP. I just hooked up with a new accountant and plan to talk about the next best step asap!

 

[imaSIGNr]

S/P here....low profile, casual , one man band.

 

[gators2001]

llc her

 

[SignTech]

Partnership ..... going LLC

 

[Border]

Right now, at least, I would fall into the group of people that do not have a partner or spouse to bring in. I have a daughter who will be 18 in a little over a year though although she seems to have no interest in any of this.
Anyways, I saw some posts here about single person LLCs being a red flag for Uncle Sam so what's that mean for me?

 

[Pat Whatley]

S-corp...proudly operating under the corporation name Idiot Space Monkeys Incorporated, Inc.

S-corp is good. I only make $500 a week as an employee of my own corporation, pay unemployment and a pretty nice benefits package to myself at a serious tax break, and the corporate tax-free dividends are looking pretty sweet as well. They kicked my retirement plan into a place I thought only "rich" people were allowed to play. The tax laws can actually be benificial, you've just got to know how they work.

Good accountants cost a lot....AND REALLY GOOD ONES ARE WORTH EVERY PENNY!

 

[AdventGurl]

Llc

 

[Pat Whatley]

I don't pay myself a salary - just take draws from the business

Stacy, you really, really need to watch that. From what I understand that puts you in the absolute highest tax bracket and leaves you completely exposed to getting ruined in an audit if you're not paying the taxes correctly. I may be wrong on that but you might want to look into it.

 

[Derf]

I am in constant communication with my CPA and attorneys.. about my situation.

An LLC would be perfect however the CA state lic board does not recognize and LLC only an S or C Corp. Some attorneys I have talked to say to incorporate others say if you have one crack in your Corp your screwed any way! now my CPA says hold off a few more years and just make sure Im properly insured with binders such as E&O Insurance above your standard liability policies and getting an umbrella policy among other asset protection measures.


I think each person and business is structured different and there is some overlapping protection and tax benefits on each form of business.

There is more than one way to skin a cat in others words.

I will be incorporated by next year.

 

[SignosaurusRex]

Inc. with sub-chapter S election.

• Personal asset and liability protection
• More liberal tax writeoffs
• Generally better treatment by government and lenders
• No double taxation as with straight corporations
• Easier to sell when you get to that point
• In some cases, a better appearance to the public

Ditto. Also have an S/P for another business........some excellent bennies in that too if done properly.

 

[slipperyfrog]

LLC here for the liability protection.

 

[Bigdawg]

Thanks Pat, but believe me - it isn't much. All of our money was plowing back into the business.

I don't take it in the books as a draw. I take it as a paid labor expense against a specific job. That way I only pay taxes once on the money instead of on both the draw and the profit from the job.

 

[Capital Signs]

So would you say that Incorporated is the best way to go by the majority of people here saying so? Cant really tell.

But this is a great site for incorporating, and least expensive in my opinion.

www.legalzoom.com