Sole Proprietorship or LLC?

Question

I've been working on starting up a webdesign business but I can't decide on wether I should make my company a sole proprietorship or an LLC. I like the extra protection that an LLC provides but is there really that much risk with owning a webdesign company?

Answer 1

When you are a sole proprietor, you are solely responsible for anything that happens to the business. That includes the unfortunate possibility of losing your business or someone suing you which people are prone to doing these days. If you incorporate as an LLC, you separate yourself from those liabilities and also can take your expenses off on your taxes which is a huge benefit. I've done both and speak from experience. I would recommend an LLC every time. Good luck and do well.
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Answer 2

First, I would never set up any type of business as a sole proprietorship ... your personal property is at risk. LLC's do work well, despite that you've been told. Forget C-Corps ... tax liability is too high. I would choose between an LLC and s-Corp. Check with your accountant, through ... LLCs have slightly different rules from state to state.

Answer 3

@firewater "or a LLC (additionally a corp)" i'm sorry, yet you're incorrect. An LLC is a constrained criminal duty company, no longer an company. that's a criminal entity, yet in basic terms firms (xxx, Corp. or xxx, Inc.) are firms. They document an 1120 until it has elected to be dealt with as a sub-S company. that's a perfect technique that demands submitting a form with the IRS. "additionally I pay attention it truly is totally tax heavy whilst in comparison with sole Proprietorship. is this actual" An LLC is a skipped over entity meaning the IRS and maximum states do no longer are conscious of it. hence the LLC has to ensure on (decide) the way it needs to be dealt with for tax applications. Many single member LLCs go with to document as a sole proprietorship. yet there are commonly annual submitting expenditures the LLC has to pay in spite of the tax scientific care. In MA, as an occasion, the LLC has to document each year with the Secretary of State's place of work; it truly is $500. AND if the LLC chooses to document as an company (typical or sub-S) the DOR expects the required $456 minimum "earnings" tax imposed on firms. " i will have possession of my call " in basic terms in the state you register the LLC. each and every state regulates company entities (LLCs, firms, and partnerships) so which you have got 50 diverse Joe's LLC and there could be no longer something you're able to do approximately it. the only way you are able to shelter your company call is thru trademarking. or maybe that doesn't assure some great national company won't sue you because of the fact they desperate they had to apply it, too.

Answer 4

LLC... u never wanna lose ur personal stuff!!!