LLC Or Sole Proprietorship

forsmant

Which business form is best for a new contractor? I am a carpenter interested in starting my own legitimate business but am confused as to which format is best. Does an LLC require two or more owners? If so would my wife be a legitimate owner?

SLSTech

Some states allow a single individual to form an LLC, according to this site Nebraska is one of them

http://www.companiesinc.com/llc/nebraska.asp

I would consult with a lawyer & an accountant, we have no way of knowing what would be best for you.

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forsmant

Thanks for the link!

naptown CR

Definately an LLC In some states it only requires one principal and yu wife would be OK if two are required. If you want to do govt work have her own 51% and you will qualify for mwbe set aside work. The LLC will protect your personal assets to a greater extent than a sole prop

dakzaag

When I formed my LLC, the lawyer said anyone can do it for any reason. I split the Company 50/50 with the wife. Might be just Indiana. Lawyer said that a dog could form an LLC if he can afford the proper paper work.

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TxElectrician

Before you sign your wife up as 51% owner, or any %, remember hopefully this business will be yours the rest of your life. The wife? not so much.

For me a S Corp works best, but only by discussing your situation with your lawyer can you decide what is best for you.

If you don't have an attorney get one. You will need one sooner or later.

world llc

depends how much personal protection you need too
as said... talk to a lawer

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480sparky

You accountant will tell you whether an LLC, LLP, C corp or S corp is best for you. Your lawyer will do the work.

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DavidC

We felt the LLC was right for us

AFTER

speaking with an attorney and accountant.

My wife owns a percentage but I'm betting on being done with the business long before I'm done with her.

Good Luck
Dave

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TxElectrician

I've had mine (wife) for 29 yrs, I have just seen too many not last.

For us it has worked out best that I don't get involved with her business or her with mine.

pcplumber

An LLC is to limit liability to only the Limited Liability Coropration (LLC). For example, if you have two companies, you can form two LLC's and if you get sued for a $Billion because your workers accidentally blew up a building, the building owner cannot sue your other LLC. The LLC's purpose is to limit liability.

If you own a $million home, I think an LLC will shield your personal assets. The problem I have with LLC's is we have to pay the the California Franchise Tax Board $800 every year, but we also have to pay $800 per year for a C corporation.

I own three apartment buildings and my attorney talked me into forming one LLC for each building. Then, in the middle I backed out because I would have to pay $800 per year for each building. Then, I was thinking, for each building, I am already paying for liability insurance, I have a Living Trust, I have a family partnership, and I would have an LLC. For the $2400, the LLC cost every year, it would be less expensive to increase the insurance by a few million dollars.

A lot of people saw television commercials saying you can sheild your business by forming an LLC in Nevada even though their business was in another state. The commercial did not tell the people they would increase their taxes and have to pay taxes in their home state and in Nevada.

An LLC is suppose to limit liability to the specific company you are getting sued for, but you may not be able to eliminate all of your liability. For example, if you blow up a home your liability may be limited, but if you are personally negligient, or commit fraud your victim may be able to go after your personal assets.

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pcplumber

they will make you sign a form accepting personal responsibility.

Suppose, I am the owner of a supply house, you are an LLC, and you want me to give you credit. Your LLC makes it and clear that if you close your shop I can't collect a penny from you, so I make you sign a form stating that you accept personal responsibility for all debts.

How would you like to do a large job for an LLC when you can't sue a real person and you know the only thing you can sue is a piece of paper. I am very leary of doing business with people who are trying to hide their assets, or anything at all.

A C Corporation is different in California when collecting debt. Most often, a judge considers the president of a C Corporation personally liable for debt.

One of the good things about an LLC is it makes it very difficult for people to find your assets. If I type your name in knowx.com (a pay site) all your real estate assets, liens, and judgments throughout the entire U.S. appear in the results, but if you put your real estate into an LLC name, your assets are hard to find. I don't know if you can use a partnership name for realestate. I think you can. But, if you are sued, you will be required to declare all your assets when you get a judgment against you, and I'm sure this includes LLC's, so there is no trick nor secret to hiding your assets. But, if people can't find your assets before you are sued, you are less likely to be sued because no attorney wants to spent their time on a lawsuit when they don't think they can collect money from you. So, make yourself look poor if you are rich.

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