Forming an LLC, any tips?

[Oglethorpe]

I have just decided to start my own company. It will have one employee. ME!

I need to set up an LLC to front my services and to eventually be the backing for addons such as insurance, billing, etc.

Has anybody gone through this wringer yet? So far, there appear to be a few simple options (legalzoom.com), but are there any potential "gotchas" that I should be aware of?

If it matters, I'll be providing business and software consulting services.

Thanks!

G

 

[Austin]

You probably need to start here before you go any further.

http://www.irs.gov/businesses/small/article/0,,id=99336,00.html

 

[The Last Chimney]

I am about to begin the process of creating a property-holding LLC.

It won't do anything except possess deeds, so it shouldn't be too complicated. I will check out this link and would also appreciate any other info about LLC's.

 

[Oglethorpe]

I've read through the IRS pages before but most of the time (to me) they make tax talk as clear as mud. I'll wind up getting an accountant to take care of that, since for business, taxes need to be paid as income is earned.

I was basically just looking for general tips or lessons learned that others may have already trailblazed.

 

[jsrdrnr]

Get a laywer. They know the ropes. I know it cost a bit more, but it keeps the errors out of the picture. I had a friend that was able to set up his LLC here in VA for around $400 total.

 

[Austin]

I've read through the IRS pages before but most of the time (to me) they make tax talk as clear as mud. I'll wind up getting an accountant to take care of that, since for business, taxes need to be paid as income is earned.

I was basically just looking for general tips or lessons learned that others may have already trailblazed.

I think checking with an accountant is prudent decision. You also have to take into account your state laws.

 

[beginish]

+1 on both the lawyer and accountant. Unlike corporations, which have well-established rules for each type, LLCs are unique creations by each state, which has it's own set of rules. A NJ LLC is different from one in PA. Using a lawyer to create the Operating Agreement is money well spent.

 

[brianw]

Had a LLC for 10 years... get thee to a lawyer and a accountant

 

[Obsessed]

Seriously, consult a lawyer and an accountant. And no, I'm not shilling for the legal profession. Trust me, lawyers make more money fixing up problems after the fact than they do helping people set things up properly in the first place.

 

[Austin]

Seriously, consult a lawyer and an accountant. And no, I'm not shilling for the legal profession. Trust me, lawyers make more money fixing up problems after the fact than they do helping people set things up properly in the first place.

Yep.

 

[Jim]

Yep.

Yep

 

[instpasr]

Yeppers

 

[JaDo]

+1 on both the lawyer and accountant. Unlike corporations, which have well-established rules for each type, LLCs are unique creations by each state, which has it's own set of rules. A NJ LLC is different from one in PA. Using a lawyer to create the Operating Agreement is money well spent.

Yes, as beginish said, the money for lawyer fees/accountant fees would be very well worth it. There are a lot of very valuable tax deductions to be aware of as a small business owner....you can amortize your startup costs, take special depreciation deductions, deduct interest expense on any business loans, etc.. Getting good advice from someone who is a subject matter expert is the way to go. Making sure that your business is set up correctly can protect you in many ways and get you started on the right foot. Also, having clear documentation of your business and well organized financials can help you in obtaining financing. Good luck with the new business!

 

[mretzloff]

Take a look at LegalZoom.

 

[Shave A Buck]

An LLC is a no brainer for a mouthpiece AKA lawyer. Some will gouge you which I found out here in N.J. I was lucky and did not bite at the 1000.00 fees most quoted. I found a guy who did it for 300. Shop around and consider doing it yourself as it is only a means of filing papers. The lawyer and accountant come later on.

 

[Oglethorpe]

An LLC is a no brainer for a mouthpiece AKA lawyer. Some will gouge you which I found out here in N.J. I was lucky and did not bite at the 1000.00 fees most quoted. I found a guy who did it for 300. Shop around and consider doing it yourself as it is only a means of filing papers. The lawyer and accountant come later on.

Believe it or not, in my research this is what I'm finding from a few people I've spoken to, but I will not discount the successes noted here in working with lawyers and accountants. You sometimes hear about lawyers gouging but I guess you have to look out for it. For the record, legalzoom.com quoted me between $500 and $600 for the IRS and state paperwork, name validation, and some other throw-in features.

In actuality, I realize that an accountant is more important in this case because of all the tax implications. The steps to setting up an LLC actually are not that complicated. I chatted with a few lawyer buddies of mine and one of them is going to sit with me and just run through the forms to make sure there isn't anything to be missed, and if it looks more complicated than we can handle "off the clock" then I'll investigate professional legal help (my friend is in malpractice claims defense - not his area of expertise).