Liability & Legality

#21 (permalink)

Doesn't matter. They say that one should make a different legal entity for each type of different business you go into. Right now my mom owns a C-Corp, I own an LLC, my aunt owns a C-Corp, and I'm trying to get my dad to make an LLC for the condo he rents out.

Its better safe than sorry.

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#22 (permalink)

If you are making a consistant 3K+ a month you should get an LLC. Otherwise I dont see a need for it.

#23 (permalink)

Thats nonsene. There's no set amount of money for you to make before making a company.

I also don't see what's the problem with making one even if you are making less than $100/month.

You can still be sued and lose everything you have if you are not protected legally, and an LLC only costs you around $100/year......

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#24 (permalink)

Not in Europe, pal. If you make here 100$/month you will be in red numbers. Understand that not all are here from USA.

#25 (permalink)

how much does it cost in the UK?

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#26 (permalink)

I didn't even know that Europe had LLC's? :shuriken:

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#27 (permalink)

And what did you think we have here?

#28 (permalink)

Dunno lol, never really thought about it, mainly because I know this guy who is making $100k+ from his website and he hasn't incorporated or anything, and he lives in London, I believe.

He says it isn't necessary for him to do that.

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#29 (permalink)

Well, I don´t have an LLC but a personal business as I could call it. There are many different options for this. Maybe he doesn´t know he must do that or they have an option to write their business incomes as a personal income.

#30 (permalink)

He's just operating as personal, which is pretty insane. He's like 17, making $100k/month but reinvesting more than that back into his site (which is massive btw). Can't tell you the link now that I told you some of his stats though.
Guessing that since most of his cash comes in from Paypal, I dunno lol nvm

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#31 (permalink)

Well with PayPal you can pretty much "hide" your income. But that´s in a way illegal.

#32 (permalink)

Thing is, he's only really saving paperwork because he's not making any money.

If he was smarter though he'd be able to declare losses on his company and transfer those losses to the next year where he might end up with an actual profit.

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#33 (permalink)

I live in the US, and to drill it down further, New York - The benefits are as follows:

No LLC or Corp - You report the income as 'self employment'. You will pay hefty taxes, because 'you' are the employer AND the employee.

LLC - offers you, the individual, protection. hence, "Limited Liability". Not necessarily the same tax benefits as below.

Corp - If you create a Corporation, you pay franchise tax - a token amount each year (ex: $100). If you get "S-Corp" designation, then it offers you tax benefits. there is NO Corporate Tax being paid. After the income and expense are balanced out for the corp, the decreased income is pushed over to your personal income, paying less in taxes.

Hope this helps -

Btw, Iam not a lawyer or an accountant