Hot answers tagged sole-proprietorship
9
LLCs will give you a legal 'shield' that a sole-proprietorship will not but all other costs will generally be lower with a sole proprietorship.
I can't say about grants but bank loans should be the same both ways in that for a startup the bank will want you to personally guarantee the loan anyway.
Writing off startup costs should be the same both ways, at ...
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but can I keep the same EIN and use it for my new business?
Short answer: Yes (see this reference)
Long answer: An EIN exists for the life of the business. So as long as that business exists you can use that EIN. If you change the name of the business you can still use the same EIN, because technically it is the same business – it’s just operating ...
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There's an excellent short book from Nolo Press titles "LLC or Corporation?". It compares a Sole Prop with LLC and corporation. It was written specifically to help small business owners think through these types of issues. You should be able to pick it from your local library if you don't want to buy the book.
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I'm neither an accountant nor an attorney, so all the usual stipulations apply.
It sounds like your previous venture (which never got off the ground) was essentially a sole proprietorship with a fictitious (DBA) name. The IRS website states that a sole proprietor doesn't have to get a new EIN simply on the basis of changing either the business name or ...
4
There is no company structure that is going to guarantee that your personal assets will be 100% safe in the event you are sued. Otherwise that would lead to unscrupulous people taking advantage of it to harm good citizens such as ourselves. You can't protect yourself 100%, but that shouldn't be a reason for you not to "get in the game". As a business and an ...
2
So you have a range of options for keeping control. These will vary by legal system and country but in general:
Write it into the rules of the company. Anyone else buying in has to abide by the rules.
Always keep 51% for yourself. Only make the remainder available at all times thus you have final say on all votes.
Have 2 classes of shares "voting and ...
2
You're in the same position as thousands of young businesses: need credit to grow, but can't get credit because you haven't grown enough / shown enough profits.
Since you're not incorporated every bank under the sun is going to check your personal. You don't have an EIN so, to them, your business doesn't exist.
Even after you incorporate most banks are ...
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Get General Liability Insurance if you incorporate.
As others mention, your corporation might protect your personal assets, yet liability insurance helps cover legal and other expenses regardless of the outcome. Liability insurance for at least $2 million is not too expensive (certainly far less expensive than legal fees) and your corporation can claim the ...
2
for small operation and beginning stage you can accept payment on your personal social security ID. The question, is the company or person hiring you willing to deal at a personal level. The company will then just send you a 1099 at the end of the year (usually above $600)
Yes, you can start without registration but think about registration asap.
All your ...
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There is no process for explicitly authorizing this, besides legally classifying her as an employee or business partner. That said, it looks like you don't have to.
http://www.inc.com/articles/1999/10/14677.html:
For tax purposes, your spouse is allowed to work for your sole proprietorship without being classified as an employee or as a business ...
2
Nope. Your S-Corp can pay you wages or salary, but if it does, like all employers, it will have to withhold FICA and Medicare. In normal years, this will amount to 7.65%. Also, as an employer, you have to match these amounts. That totals 15.3%. That number probably looks familiar.
You could maybe not pay yourself a salary at all and just let the profit ...
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A single-member LLC and sole proprietorship are the same thing from the federal tax perspective. All taxes will be calculated and treated the same and all deductions you can take as a sole proprietor will be allowable to you as a single-member LLC.
In general from federal tax viewpoint, there are such business structures:
(a) Sole proprietor = Single-member ...
2
If your LLC only has a single member (owner) then it is treated as a disregarded entity by the IRS and you don't have to file separate federal tax returns for it.
The value of the liability shield must be evaluated in regard to your personal assets. If they are substantial, then I would recommend going the LLC route.
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Foming a business trust is something I've never heard of with any of my contacts -- however if you're thinking of a partnership, then yes I understand where you are coming from. In general, a choice of entity is highly subjective and varies on too many factors to be answered in a forum, however below is a key consideration to keep in mind with a Trust vs. an ...
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Only a limited liability company allows you to separate yourself from personal liability, along with the attendant regulatory filing overheads. However, you have to ask yourself what is your degree of personal liability if undertaking a micro-business. Tax benefits are only worthwhile if individual tax rates are higher than corporate (which unless you have ...
1
Is it a good idea to do the Partnership/Co-Owner?
No-one can really answer that. Its up to you to decide, but keep in mind that friendship and business partnership frequently become mutually exclusive.
We don't have any terms and not sure if we'll have one.
This is a very bad idea. Make an agreement on terms, put it in writing, have an attorney ...
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IRS do not provide tax advice. You should call a tax adviser (EA or CPA) who can help you.
Taxes are significantly more complicated than TurboTax commercials make them appear. If you're starting a business you must have a reputable and professional tax adviser who will walk you through all the issues, educate you on how to manage your books, and will ...
1
Obviously you need to check with a tax lawyer, but this is my understanding: If you do not live in the US and you own a US C-corporation. If you then sell this corporation there is no tax due in the US on the sale (a foreigner owning shares in a US corporation does not need to pay tax when selling those shares)
Then the question of if you have to pay tax ...
1
You're on the hook, tax-wise, for this money. You may be able to offset it with deductible expenses, but if you don't have enough of those before the year end - you'll have to pay taxes (possibly also SE taxes) on the difference. You have to remember that not every business expense is deductible, some aren't, some have to be capitalized or amortized.
LLC is ...
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Ask your accountant. If you don't have an accountant get an accountant :-)
Expenses and litigation aren't the only issues. In the UK for example there are tax breaks for investors that only apply to LLCs. There are often ways you can split your income between wages and dividends that make you more tax efficient as an LLC.
There are also advantages when ...
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It all depends on what you actually do, but to keep your business status as a sole trader in the UK, you would need an English address. If you have one and you for example sell on-line services you could stay registered only in the UK. However, this wouldn't be totally legal, but nobody would track you to check how much time you spend in German and how much ...
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Yes you can register either a sole-proprietorship or LLP or Private Limited and still have number of websites run by this company. Proceeding of which sort of company is totally your choice and depends on your long term plan. Go for Private Limited company if you are into this for long term, however your expenses for registering and other legal aspects gets ...
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I have done this so yes it's possible to have it changed all though it may be bank specific based on their rules. Worst case you close your original account and open a new one with the EIN number.
On the other part of your question concerning the same bank for commercial vs personal accounts I have thought about this a lot and have gotten advice from ...
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