So here's the deal, I'm a 19 year old in a band in Phoenix and we are going on a big tour this summer. A friend mentioned to me something about forming an LLC to protect ourselves incase we get in any kind of accident, at which point I looked into it further. The more I look into it, the better it sounds. But I don't have the slightest idea where to start. I would think we would be taxed as a sole proprietorship, under my name, but how would our taxes work if our only source of income is from selling t shirts, and that occurs in a different state every night? Our profit from that usually ends up being anywhere from $500-1000 / night, is that all taxable? And if so, would our high list of expenses be deductible from that? And then, how do we prove any sort transaction, since we don't print recepts with each sale? The only real records we keep are handwritten tally's each night. Thanks!
2007-04-18 05:19:00 · 2 answers · asked by Andrew R 1 in Business & Finance ➔ Small Business
All very good questions. I think in your particular situation, it would not be a bad idea to talk with an attorney and/or a CPA. In Arizona (and just about any other state as well), the forming of a corporation or LLC is pretty easy. You can go to the Arizona Corporations Commission site and register your name, fill out the easy forms and have it filed. However, if you intend on forming a corporation or LLC because you intend on having that entity shelter you from high taxation's, you better know what is the correct entity to have. That is where your CPA and/or attorney would come in. It might cost you a couple of hundred bucks, but if you are serious about what you are doing, it will save you thousands in the long run.
Good luck, and happy touring.
2007-04-18 05:34:16 · answer #1 · answered by SNW 2 · 1⤊ 0⤋
Talk to an accountant. They will be cheaper than an attorney, and this isn't complicated enough to take to an attorney.
2007-04-18 07:02:36 · answer #2 · answered by jdkilp 7 · 0⤊ 0⤋