Life Forming your own LLC and doing contract work

**BigRichard** · 06-17-2019, 06:22 PM

I put in my resignation late last week. It was suggested today I might be able to do some contract work for them remotely which has me intrigued. Who on CP has formed their own LLC and done some contract work. Any suggestions on how to handle it? Would you go some other route?

displacedinMN · 06-17-2019, 06:31 PM

I had a lawyer do an LLC. It is basically a shell corporation for liability reasons. It costs 40 bucks a year to reaffirm it with the state. I do not remember the original cost because it was done when I did the will/trust.

You may be able to do an easy LLC with Legalzoom. Or with a lawyer friend.

**MahiMike** · 06-17-2019, 06:39 PM

LLC or S Corp. Talk to an accountant. S Corp saves a ton on tax write-offs.

Kiimo · 06-17-2019, 06:47 PM

I created an LLC in March. I would highly encourage you to use LegalZoom as I did.

Get the legal addition and the compliance addition. Skip the accounting unless you bad with the spreadem sheets.

California charges all LLCs 800 smackers almost immediately so thank your lucky stars you don't live here.

Then again I'm spending the 4th on a boat watching the fireworks over the Pacific so I guess you get what you pay for.

LiveSteam · 06-17-2019, 06:48 PM

Quote:

Originally Posted by MahiMike

LLC or S Corp. Talk to an accountant. S Corp saves a ton on tax write-offs.

This

KCUnited · 06-17-2019, 06:58 PM

Ya gotta look out for number one and try not to step in spreadem sheets.

**BigRichard** · 06-17-2019, 07:08 PM

We may be moving states fairly soon and it sounds like the LLC you have to reregister in your new state. Do you know if you have to do that with the S Corp?

**Bugeater** · 06-17-2019, 07:30 PM

You still haven't left Omaha?

kccrow · 06-17-2019, 07:34 PM

Yeah done it.

LLC or S-Corp doesn't matter really, still register in the State... You have to file Articles of Incorporation with the State for a S-Corp.

S-Corp just, really, declares pass-through taxation to the members rather than being taxed as a C-Corp. A LLC can actually choose to be taxed as an S-Corp.

No real reason to be an S-Corp unless you intend to pay yourself a salary from the earnings of the business and expect there to be additional net income. All you really need is to file as an LLC to help protect your personal assets, which both do. Now, if you do elect S-Corp status as an LLC, you can reap the benefits of less Payroll Tax and not having so much paperwork for a C-Corp and everything functions pretty much the same.

Then, get insurance. General Liability, Errors and Omissions, and Data Breach should be of primary importance if you're doing consulting and working with another company's data and providing them suggestions.

LiveSteam · 06-17-2019, 07:38 PM

What do you do for a living?

**BigRichard** · 06-17-2019, 07:56 PM

Quote:

Originally Posted by Bugeater

You still haven't left Omaha?

Nope, I had kind of been waiting on the perfect job to make the move. I think I just found it. Work from home and work from anywhere in the US.

**BigRichard** · 06-17-2019, 07:59 PM

Quote:

Originally Posted by LiveSteam

What do you do for a living?

Well, I am currently doing healthcare analytics/heathcare IT but I am doing a slight change in my direction as I am still in healthcare doing "IT stuff" but it really isn't analytics.

LiveSteam · 06-17-2019, 08:05 PM

Quote:

Originally Posted by BigRichard

Nope, I had kind of been waiting on the perfect job to make the move. I think I just found it. Work from home and work from anywhere in the US.

Oh hell yes.. If you have a chance to pull that off. Get after it.

**Buehler445** · 06-17-2019, 08:10 PM

Quote:

Originally Posted by displacedinMN

I had a lawyer do an LLC. It is basically a shell corporation for liability reasons. It costs 40 bucks a year to reaffirm it with the state. I do not remember the original cost because it was done when I did the will/trust.

You may be able to do an easy LLC with Legalzoom. Or with a lawyer friend.

There is no initial cost. In Kansas anyway.

Quote:

Originally Posted by MahiMike

LLC or S Corp. Talk to an accountant. S Corp saves a ton on tax write-offs.

This is not correct. All business expenses are deductible with either entity. S Corps are pass through income rather than self employment, but you have to pay yourself a reasonable wage. See Crow's comments.

Definitely talk to an accountant. There will be a return to file, plus you have to keep a set of books, so whatever you do make sure they're on board.

Quote:

Originally Posted by Kiimosabi

I created an LLC in March. I would highly encourage you to use LegalZoom as I did.

Get the legal addition and the compliance addition. Skip the accounting unless you bad with the spreadem sheets.

California charges all LLCs 800 smackers almost immediately so thank your lucky stars you don't live here.

Then again I'm spending the 4th on a boat watching the fireworks over the Pacific so I guess you get what you pay for.

Really, you don't need to. In Kansas you just have to apply through the SOS website and fill it out. If it's a single member LLC, you won't need an operating agreement per se. If you have a partnership definitely see an attorney so either party gets ****ed.

Quote:

Originally Posted by BigRichard

We may be moving states fairly soon and it sounds like the LLC you have to reregister in your new state. Do you know if you have to do that with the S Corp?

Don't think so, you just have to file the return in the state that it is formed.

Quote:

Originally Posted by kccrow

Yeah done it.

LLC or S-Corp doesn't matter really, still register in the State... You have to file Articles of Incorporation with the State for a S-Corp.

S-Corp just, really, declares pass-through taxation to the members rather than being taxed as a C-Corp. A LLC can actually choose to be taxed as an S-Corp.

No real reason to be an S-Corp unless you intend to pay yourself a salary from the earnings of the business and expect there to be additional net income. All you really need is to file as an LLC to help protect your personal assets, which both do. Now, if you do elect S-Corp status as an LLC, you can reap the benefits of less Payroll Tax and not having so much paperwork for a C-Corp and everything functions pretty much the same.

Then, get insurance. General Liability, Errors and Omissions, and Data Breach should be of primary importance if you're doing consulting and working with another company's data and providing them suggestions.

The bolded is the crux of the issue. And the way I try to explain it to people is if you want to do anything that are balance sheet activities, purchase assets, service debt, retain earnings, build operating capital, all don't hit the income statement (and tax return), that makes it make sense for an S-Corp.

I don't know the rules if it is a single member LLC, it may not be able to be taxed as an S-Corp. Talk to your accountant.

I'd do it. For me, it made me start treating my business as a business and made me a better businessman. Not that I didn't know what I was doing on the business side of things, but having it separated forced me to do a little bit of it and made it far easier for the rest of it.

**Buehler445** · 06-17-2019, 08:15 PM

You didn't say, but if you're going to quit your job and do this instead, DEFINITELY do your due diligence. Then if you do it, save up a pile of money.

I've seen several fools do it and they blow through every dollar of revenue then something unexpected, like, "WHAAA I owe taxes? HERP DERP" and then they struggle.

Plus if you're going to do it, get yourself a solid understanding of your expense. Because while it is deductible, it isn't free. Know your expenses.

06-17-2019, 06:22 PM
BigRichard Buddy Christ is a Chiefs fan Join Date: Nov 2008 Casino cash: $1679546	Forming your own LLC and doing contract work I put in my resignation late last week. It was suggested today I might be able to do some contract work for them remotely which has me intrigued. Who on CP has formed their own LLC and done some contract work. Any suggestions on how to handle it? Would you go some other route?
Posts: 10,427

06-17-2019, 06:31 PM	#2
displacedinMN It was not a fair catch Join Date: Aug 2012 Location: Correcting papers Casino cash: $2712630	I had a lawyer do an LLC. It is basically a shell corporation for liability reasons. It costs 40 bucks a year to reaffirm it with the state. I do not remember the original cost because it was done when I did the will/trust. You may be able to do an easy LLC with Legalzoom. Or with a lawyer friend. __________________ #investigatecarlcheffers
Posts: 36,457

06-17-2019, 06:39 PM	#3
MahiMike He's Mahomie! Join Date: Aug 2001 Location: Jax, FL Casino cash: $10023443	LLC or S Corp. Talk to an accountant. S Corp saves a ton on tax write-offs. __________________ 99.9%
Posts: 17,387

06-17-2019, 06:47 PM	#4
Kiimo MVP Join Date: Feb 2013 Location: Studio City, CA Casino cash: $3848742	I created an LLC in March. I would highly encourage you to use LegalZoom as I did. Get the legal addition and the compliance addition. Skip the accounting unless you bad with the spreadem sheets. California charges all LLCs 800 smackers almost immediately so thank your lucky stars you don't live here. Then again I'm spending the 4th on a boat watching the fireworks over the Pacific so I guess you get what you pay for.
Posts: 12,729

06-17-2019, 06:58 PM	#6
KCUnited Cheat Death Join Date: Nov 2007 Location: Land of Drincoln Casino cash: $2058244	Ya gotta look out for number one and try not to step in spreadem sheets.
Posts: 34,046

06-17-2019, 07:08 PM	#7
BigRichard Buddy Christ is a Chiefs fan Join Date: Nov 2008 Casino cash: $1679546	We may be moving states fairly soon and it sounds like the LLC you have to reregister in your new state. Do you know if you have to do that with the S Corp? __________________ "You know, they lay down with their ugly wives in front of their ugly children and just look at their loser lives and then they look at me and say, "I CAN'T PROCESS IT!" Well, no, and you never will. Stop trying. Just sit back and enjoy the show .... You know?" Carlos Irwin Estevez
Posts: 10,427

06-17-2019, 07:30 PM	#8
Bugeater The Maintenance Guy Join Date: Sep 2005 Location: Renovated Bugeater Estate Casino cash: $6232680	You still haven't left Omaha?
Posts: 70,443

06-17-2019, 07:34 PM	#9
kccrow MVP Join Date: Oct 2011 Location: Michigan Casino cash: $3057078	Yeah done it. LLC or S-Corp doesn't matter really, still register in the State... You have to file Articles of Incorporation with the State for a S-Corp. S-Corp just, really, declares pass-through taxation to the members rather than being taxed as a C-Corp. A LLC can actually choose to be taxed as an S-Corp. No real reason to be an S-Corp unless you intend to pay yourself a salary from the earnings of the business and expect there to be additional net income. All you really need is to file as an LLC to help protect your personal assets, which both do. Now, if you do elect S-Corp status as an LLC, you can reap the benefits of less Payroll Tax and not having so much paperwork for a C-Corp and everything functions pretty much the same. Then, get insurance. General Liability, Errors and Omissions, and Data Breach should be of primary importance if you're doing consulting and working with another company's data and providing them suggestions. Last edited by kccrow; 06-17-2019 at 07:47 PM..
Posts: 12,681

06-17-2019, 07:38 PM	#10
LiveSteam The Constitutional Choo choo Join Date: Dec 2009 Location: homeof43conferencetitles Casino cash: $1975432	What do you do for a living? __________________ Progressivism.. The Politically Correct way of saying "I'm a Communist slash Nazi" depending on what the issue of the day is?
Posts: 44,311

06-17-2019, 08:15 PM	#15
Buehler445 Supporter Join Date: Apr 2007 Location: Scott City KS Casino cash: $2084734	You didn't say, but if you're going to quit your job and do this instead, DEFINITELY do your due diligence. Then if you do it, save up a pile of money. I've seen several fools do it and they blow through every dollar of revenue then something unexpected, like, "WHAAA I owe taxes? HERP DERP" and then they struggle. Plus if you're going to do it, get yourself a solid understanding of your expense. Because while it is deductible, it isn't free. Know your expenses.
Posts: 56,895