SHOULD MY BUSINESS BE AN LLC OR SOLE PROPRIETORSHIP?

The proper business structure can make all the difference when it comes to leveraging and scaling your business. Once you've done your due diligence and have consulted with a professional regarding what's best for your business needs, If you have already been operating as a sole proprietor, you should consider forming an LLC. LLCs limit an owner's personal liability for business debts and lawsuits and offer a lot of flexibility when it comes to ownership, management, and taxation of the business.

An LLC lets you take advantage of the benefits of both the corporation and partnership business structures. LLCs protect you from personal liability in most instances, your personal assets — like your vehicle, house, and savings accounts — won't be at risk in case your LLC faces bankruptcy or lawsuits. 

The LLC has become a popular small business structure in the United States, because it's easy to form, and very flexible in the types of businesses for which it's well suited. An LLC usually costs more to form and maintain than a sole proprietorship or general partnership. States charge an initial formation fee. 

Many states also impose ongoing fees, such as annual report and/or franchise tax fees. Check with your Secretary of State's office. One of the biggest tax advantages of a limited liability company is the ability to avoid double taxation. The Internal Revenue Service (IRS) considers LLCs as “pass-through entities.” Unlike C-Corporations, LLC owners don't have to pay corporate federal income taxes.

THINGS YOU CAN BUY WITH BUSINESS CREDIT

One of the biggest tax advantages of a limited liability company is the ability to avoid double taxation. The Internal Revenue Service (IRS) considers LLCs as “pass-through entities.” Unlike C-Corporations, LLC owners don't have to pay corporate federal income taxes.

What Can Be Written off as Business Expenses Under Your LLC?

• Car expenses and mileage.
• Office expenses, including rent, utilities, etc.
• Office supplies, including computers, software, etc.
• Health insurance premiums.
• Business phone bills.
• Continuing education courses.
• Parking for business-related trips.

LLCs offer more protection, tax benefits, and other advantages that make them worth considering as business entities. If you currently own a sole proprietorship and wonder whether you can change it to a limited liability company (LLC), the simple answer is yes.

DIY SMALL BUSINESS STRUCTURING. SAVE MONEY & STRUCTURE YOUR OWN BUSINESS TO OPEN THE DOORS TO LEVERAGE, FUNDING, AND MORE. 

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