Should my small business be an LLC or Sole Proprietorship?

Question

I'm looking to start a computer service business in South Carolina, and I'm on the fence between choosing an LLC vs a Sole Proprietorship. I've read up on the pros and cons of the various business structures, but I would like to solicit some feedback and opinions as well.

Starting up quickly with limited costs is a primary concern. Would an LLC cost much more or take much more time? I would like to begin within a month's time (yes, I have an initial business plan).

Some other concerns:

I will need personal protection either through business insurance, the protection of an LLC, or disclaimers.

I might eventually hire employees, full-time or temporary. This would probably not happen right away, although I cannot be sure.

I will initially be working with home computer owners, although I would like to expand to service other businesses once the company has gained a reputation. It seems that an "LLC" name might help distinguish from other fly-by-night computer services.

Thanks!

Answer 1

You should talk to a tax accountant. There are many variables that will affect your choice (cost of maintaining the LLC, deductibility of expenses, limits of liability, etc.) Retaining employees and gaining marketing advantages, however, are NOT among those variables. You can hire employees as a sole proprietor just fine, and the vast majority of your customers do not give a donut's hole about the legalities of your business; they just want their computers to work.

Answer 2

If you are starting your business on your own then it would be considered a sole proprietor ship. You are the owner and worker as well. And if you are starting it with another person then it would be called partnership. The business you are going to start is up to you but you must have experience in it.

Answer 3

LLC does sound better, and it is better protection for a lawsuit.

Answer 4

it all come down to how you want to be taxed