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Sole prop or LLC?

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  • Sole prop or LLC?

    How many mobiles are sole prop?

    My parents' accountant recommended starting off with a sole prop for the simplicity and lack of cost. I would eventually move up to LLC anyway. But would I be safe enough to at least start with sole prop?

  • #2
    In my opinion, it is safer to go with LLC because your personal assets are protected from any lawsuits. If you have no personal assets, perhaps this isn't an issue. But,....especially being mobile...what if you are involved in an accident where someone gets hurt and goes after you personally? There really isn't a downside to going LLC.

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    • #3
      I'm a sole prop. My accountant said that an LLC really won't 100% protect you from being sued. Buy Liability insurance, that will cover you enough.

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      • #4
        I'm sole prop also gibson gov. has an umbrella coverage for up to a million dollars.

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        • #5
          My advice came from a lawyer, a family lawyer who cares about my best interest.... for what that is worth.

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          • #6
            Originally posted by Fur Elite View Post
            My advice came from a lawyer, a family lawyer who cares about my best interest.... for what that is worth.
            I understand and appreciate that. I don't really have any assets anyway yet, so they couldn't get much from me. I will most likely go to LLC when I get my own home and stuff.

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            • #7
              I am a sole prop, but a client recently told me why I should become and LLC. I didn't know this before. For LLCs, how much does the insurance increase?? I am getting very busy and don't want such a risk, as my hub and I are home owners.

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              • #8
                LLC was not expensive. My attorney did it for me and it was at cost because he is also my nephew it was $126. That was the states fee.
                If your dog is fat, you are not getting enough exercise!

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                • #9
                  Not expensive at all, as diam said. I think I paid $200 and that was the state's fee as well. I haven't had any ongoing costs other than that...unless I am being negligent of something!

                  If you have nothing, they can take nothing. But I too am a homeowner, with several automobiles and retirement plans. Better safe than sorry.

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                  • #10
                    I set mine up myself, in Virginia it's pretty easy and just one simple page to complete. The only fees were the state fees and it's going on three years now, so I don't remember how much, but it wasn't much.

                    Things will build quickly and you'll soon have a lot of business and a lot of money and no time to change how you are set up.

                    The only mistake I made, and my accountant now works around, is I registered my van in my name instead of my biz name. To change it before I pay off the loan would require refinancing and losing my 0% interest (ah, the good ol' days!) so we just work around it.

                    Get an accountant first thing, then try to complete as much of the paperwork on your own as you can. Simplicity depends on the state. I guess that's why Virginia appears on many "best places to do business" lists!!

                    Meesh

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                    • #11
                      I'm an LLC and my attorney told me that I should have the van put in my personal name, not my business name. This way it couldn't be touched either.
                      don't find yourself up a creek without a poodle.

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                      • #12
                        I have the vehicle in business name so that all expenses can be a write off. Also it is insured as the business.
                        If your dog is fat, you are not getting enough exercise!

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                        • #13
                          In California, it is not inexpensive to be an LLC. There is a $70 filing fee and then an annual minimum tax of $800 AND a fee based on the annual total income of the entity.

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                          • #14
                            I'm considering going with a S Corporation. An attorney I spoke to suggested it over an LLC. His main reasoning was precidence. S Corps have about 120 years of existence vs about 15 for LLC's. Cost wise for me it's about $90 if I simply apply through the state. He was an attorney that helps out our local SBDC. I haven't decided yet till I find an accountant.

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                            • #15
                              Originally posted by PoodlePal View Post
                              In California, it is not inexpensive to be an LLC. There is a $70 filing fee and then an annual minimum tax of $800 AND a fee based on the annual total income of the entity.

                              I think EVERYTHING is more expensive in California! Geez, they nail you guys every way they can, don't they?

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