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  1. #1
    Join Date
    Feb 2005
    Location
    Wetumpka ,Alabama
    Posts
    510

    Question

    Ok this may be in the wrong section but figured it was a good one.
    How many have formed an L.L.C. and how long did it take to make a profit from it (maybe there's a profit) versus no company and all income profit?

    Am looking at forming an L.L.C. company and all the fees that go with it,filing tax's quarterly,etc.So far the fees look to be around $100.00 just to file the paperwork.
    Would this be a good thing or just do a home style business?
    Thanks
    If you build it they will comb it.<br />Tim Rolan

  2. #2
    Join Date
    Jun 2005
    Location
    Greensboro, N.C.
    Posts
    5,080

    Post

    If you expect to be sued, or if you have a partner in the business, go with the LLC.
    Otherwise, there is no advantage to it, only disadvantages, and they are numerous.

  3. #3
    Join Date
    Aug 2004
    Location
    Lincolnton Ga. USA.
    Posts
    1,725

    Post

    go farther in explaining the L.L.C. thing if you please, and tim read you P.M.'s, thanks
    Ted

  4. #4
    Join Date
    Jul 2000
    Location
    NE Calif.
    Posts
    2,300

    Post

    In California there is an 800 dollar annual fee for llcs.Quote:"for the privelege of doing business in California"HAhahahahahah

  5. #5
    Join Date
    Apr 2005
    Location
    Worthington, Pennsylvania USA
    Posts
    1,848

    Post

    loggermike--does that mean that every one that takes hives in to California to polinate pays eight hundred dollars for the "privilege"?
    "Younz" have a great day, I will.

  6. #6
    Join Date
    Jul 2000
    Location
    NE Calif.
    Posts
    2,300

    Post

    It wouldnt surprise me if a foreign llc that operates in Cal. has to pay the 800 tax.Dont know.But heres a good website that explains LLCs and charging order protection:
    http://www.assetprotectionbook.com/c...ders_intro.htm

  7. #7
    Join Date
    Jul 2000
    Location
    NE Calif.
    Posts
    2,300

    Post

    The benefit of an LLC is that it seperates you and your assets from the assets of the business, as long as you dont co-mingle them.The llc needs its own EIN and bank accounts.Dont put your house or other private assets into an llc.Keep it strictly for business-dont pay personal bills with an llc check.The idea behind this seperation is lawsuit protection.Suits against you should not be able to get to the business assets as you dont own them ,the llc does.Same with suits against the business-your personal assets should be protected.All this is subject to state laws and some states are constantly eroding this protection.

  8. #8
    Join Date
    Jul 2005
    Location
    Batesburg-Leesville, South Carolina
    Posts
    1,443

    Post

    all you folks talking about "LLC" are discussing a fad. An LLC's protection is no greater than a subchapter S Corp protection, but with a S corp all you have is the initial report, then an annual return.

    So please get out of the LLC rut, you guys have more options.

  9. #9
    Join Date
    Jun 2005
    Location
    Greensboro, N.C.
    Posts
    5,080

    Post

    TWT, an LLC is a limited liability corporation. It is normally used for a partnership where things are owned more than produced. IE: Mine is a partnership that buys and rents real estate. An S corp. is a normal corp. that issues stock to the stockholders, but the profits are automatically distributed annually, rather than being taxed on corp. level and again on owner level when withdrawn. Also, the S corp. is normally used as a daily pruduction business, rather than a "holding" corp. IE:, mine manufactures a foam schredding machine and sells it wholesale to a number of retailers.

  10. #10
    Join Date
    Jan 2003
    Location
    Suffolk, VA
    Posts
    2,561

    Post

    This is all good info, but I'd really appreciate it if someone could outline the pro's and con's of an LLC (or the S corp) and how they pertain to a small scale beekeeper involved in mostly honey production and limited pollination services.

    I'd like to better understand the tax complications (reporting and filing) involved in becoming incorporated. What other issues might one face? Any clarity that you can provide is highly welcome.

    Thanks.
    Horseshoe Point Honey -- http://localvahoney.com/

  11. #11
    Join Date
    Jun 2005
    Location
    Greensboro, N.C.
    Posts
    5,080

    Post

    Sorry, Astro, but it took me three years of junior college to get that info, and typing was NOT one of my better subjects. All I can say is, if I were into making a living by myself in bkp'ing, I would go s Corp. If I were in a partnership with one or more, I would go LLC. If I was sidelining, not my major, I would stay owner-operated.

  12. #12
    Join Date
    May 2005
    Location
    Colorado
    Posts
    1,525

    Post

    I think, IMHO so don't flame me for this; most LLCs are used for tax dodges and hiding wealth from any liability. An LLC is an entity as far as the govt is concerned. But if the my loses a law suit, they can't collect from me. If I lose a lawsuit, they can't collect from my llc. That's the limited liability part. Bjut it also works out that my llc can make money without me making money. That separates my taxes from the business.

    Anyone else wanna do S Corps? my head is spinning.

    Hawk
    KC0YXI

  13. #13
    Join Date
    Jul 2000
    Location
    NE Calif.
    Posts
    2,300

    Post

    An LLC is no more a tax dodge than any other company.You pay tax on any profit,whether or not such profits are distributed, or held in the LLC.The LLC isnt taxed on profit-the members are.Its called 'pass through taxation'.

  14. #14
    Join Date
    Jun 2005
    Location
    Greensboro, N.C.
    Posts
    5,080

    Post

    Rodert, you are right on the liability, but loggermike explained the taxes. Each partner gets a K-1 at the end of the year and pays taxes on his percentage of the profits, even if it is 100% because their are no more partners.

  15. #15
    Join Date
    Jul 2000
    Location
    NE Calif.
    Posts
    2,300

    Post

    And the 1065 and K-1s are not user friendly forms IMHO !

  16. #16
    Join Date
    Jul 2005
    Location
    Batesburg-Leesville, South Carolina
    Posts
    1,443

    Post

    guys, yall are wrongheaded about this: both S corp and LLC have pass through taxation ( you are taxed only once) and both have limited liability in that as long as you are holding yourself out as doing business as the entity, the entity is liable not you. In order to get at your assets, the plaintiff would have to do something called "piercing the corporate veil" and frankly having something called 'limited liability company" has no more protection than S corp, despite it's self proclamation "limited liability."

    In addition, there is a larger body of caselaw with S corps than the LLCs since LLCs are rather new (in my state at least.)

    Accountants are pushing LLCs so they can look smart. (sorry if any pretentious accountants are here! haha)

    [size="1"][ February 12, 2006, 09:16 PM: Message edited by: FordGuy ][/size]

  17. #17
    Join Date
    Feb 2005
    Location
    Wetumpka ,Alabama
    Posts
    510

    Post

    I will admit I am lost on both accounts,while doing my personal tax this year H&R block suggested I do either LLC or S corp.Difference between them being S corp you have to pay yourself a salery,I don't know about most but there's no money in mine to pay myself,hard enough to find money to buy supplies..
    So I figured when and I mean when I do start having a profit then I would look closer at the llc and S corp..
    The state of Alabama web page is like a maze and you can't find out any information at all.I also tried my local court house,where you purchase general business license and all they knew was I'd have to go through the state to find out more and to get the forms but had to file them in my county...Boy does the government ever send you around and around in circles...
    Aside from the seperation point (legal and all), which way saves you the most money,LLC or personal business?
    Thanks and bear with me as I hate taxes!!
    If you build it they will comb it.<br />Tim Rolan

  18. #18
    Join Date
    Apr 2005
    Location
    Salem, Oregon
    Posts
    948

    Post

    When doing business in Oregon under any other name than your own, you must file with the Secretary of State, your business name and structure.
    If my business name was, "Harry Vanderpool Enterprises" I could operate in Oregon as a sole propriator without filing or paying a fee.
    As Vanderpool Farms, we had to, at a minimum, file a DBA which is $20.00 annually.
    at that point, we consulted our lawyer and accountant and chose the LLC route.
    Check out:
    www.filinginoregon.com
    Somewhere on that site is a test that will ask you questions and help you choose a structure.
    It may or may not apply to your situation.
    I have exactly ONE hive more than you.
    That makes my opinion beyond question.

  19. #19
    Join Date
    Jun 2005
    Location
    Greensboro, N.C.
    Posts
    5,080

    Post

    Fordguy, please reread. We are not wrong when we say 6 just because you call it a half dozen.
    We said they have the same rules, just that they are normally used under different conditions. I have an S corp., an LLC, an LLP, and a C corp. I have 4 different types of businesses which work best with different registrations. The LLC, LLP, and the S corp. all have similar rules, but normally are used for different types of entities.

  20. #20
    Join Date
    Dec 2005
    Location
    Volga, SD
    Posts
    2,790

    Post

    Functionally, I don't see a lot of difference between S corporations and limited liability companies (LLC stands for "limited liability company," not "limited liability corporation").

    In South Dakota at least, I can pick out two distinctions (maybe more if I thought about it more): 1) corporations are perpetual entities, while LLCs are set up for specific periods of time (these periods of time can be very long); 2) drawing up articles of incorporation will almost certainly require using a lawyer, while filing with the state for an LLC can be done more easily (although a visit with a lawyer isn't a bad idea).

    South Dakota also has a separate category for agricultural "corporations" that functions pretty much the same way. This category limits liability for farming operations if the farmers file their operations with the state. I'll be honest, I'm not really sure how if differs from some of the other categories, other than the fees for filing are lower. I would think honey farms would qualify.

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