LLC Questions

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profitaddiction

profitaddiction

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I've been looking at establishing an LLC (in Illinois) and have a few questions:

1. Does it matter if I use my home address as the companies? I'm pretty sure that shows mixed interests (not sure if the 'corporate veil' comes into play, but it would make sense) and might not be the best idea. Should I get a PO Box as my businesses?

2. I understand that it's 'Limited' Liability, so do you only keep a small amount of monies in your business accounts? Does that even matter?

If anybody can help, I would love it.
 


For 2)

I'm not sure if it helps or hurts but it puts my mind at ease: I only keep the minimum required to have my business accounts remain free (no fees). The rest I move out as soon as it goes in.
 
Isostar13 said:
For 2)

I'm not sure if it helps or hurts but it puts my mind at ease: I only keep the minimum required to have my business accounts remain free (no fees). The rest I move out as soon as it goes in.
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By that you mean move it to your personal account? I'm wondering if that does help, but once I get situated I'm sure I will do that as well
 
Every state is different, but most likely you will NOT be able to use a PO Box as the business address. You have to have what's called a "registered agent" in the state. If you are going to set up in your own state, then you can be your own registered agent, but will have to use a street address in my experience.

As far as the money, whatever you pull out of your business accounts will have to be accounted for as an owners draw and will be taxed as such. I would advise getting with a CPA if you really want to put your mind at ease.
 
Unarmed Gunman said:
Every state is different, but most likely you will NOT be able to use a PO Box as the business address. You have to have what's called a "registered agent" in the state. If you are going to set up in your own state, then you can be your own registered agent, but will have to use a street address in my experience.

As far as the money, whatever you pull out of your business accounts will have to be accounted for as an owners draw and will be taxed as such. I would advise getting with a CPA if you really want to put your mind at ease.
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I was looking at LegalZoom and you can use them as the "registered agent" - However, it still asks for a "Business Address" which I assumed I could use a PO Box and then declare them as my agent.

What you think?
 
^^ The entire point of setting up an LLC is for tax benefits and protecting your money, ie you do something naughty and get your ass sued/fined it's the LLC that gets it and only money in the LLC is at risk. Money you pulled out is nice and safe.

But this will only work if everything is set up right. For me getting a CPA to set everything up is a no brainer, they might even end up saving you as much as they cost in tax benefits they know about but you don't. Plus your time can be spent doing what you are good at AM and the CPA can spend there time doing what they are good at, the accouting. Don't just let them have complete control of anything though, always be askign questions and understand why they suggest to do things this or that way.
 
miketpowell said:
^^ The entire point of setting up an LLC is for tax benefits and protecting your money, ie you do something naughty and get your ass sued/fined it's the LLC that gets it and only money in the LLC is at risk. Money you pulled out is nice and safe.

But this will only work if everything is set up right. For me getting a CPA to set everything up is a no brainer, they might even end up saving you as much as they cost in tax benefits they know about but you don't. Plus your time can be spent doing what you are good at AM and the CPA can spend there time doing what they are good at, the accouting. Don't just let them have complete control of anything though, always be askign questions and understand why they suggest to do things this or that way.
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The CPA I went to to help w/ my 2008 taxes is right next to an Atty's office and he suggested an Atty helping setup an LLC instead of him?

I wouldn't mind spending a few extra $$$ to do it right and make sure I'm protected in the long run.
 
profitaddiction said:
The CPA I went to to help w/ my 2008 taxes is right next to an Atty's office and he suggested an Atty helping setup an LLC instead of him?

I wouldn't mind spending a few extra $$$ to do it right and make sure I'm protected in the long run.
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If you're going to pay for a registered agent, you might as well set up in a better state (Delaware, Nevada, Wyoming etc) to more protect your anonymity.
 
Unarmed Gunman said:
If you're going to pay for a registered agent, you might as well set up in a better state (Delaware, Nevada, Wyoming etc) to more protect your anonymity.
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That's what I did. A registered my LLC with an agent/mail depot in Nevada. He will set you up a with a real address with a suite number, not a PO Box. All you mail/checks can be forwarded to your Po Box.
 
I'm in IL and my lawyer and act both told me to do an S-corp. but i heard from other people to do LLC. i ended up doing S-Copr, but not sure yet if it was a smart move.

Incorporating is pretty cheap though, i paid my lawyer a few hundred bucks, including the state costs to file...
 
AMSHustla said:
That's what I did. A registered my LLC with an agent/mail depot in Nevada. He will set you up a with a real address with a suite number, not a PO Box. All you mail/checks can be forwarded to your Po Box.
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How can they give you a physical address of something like that? They use theirs? If you declare your business in a different state would you be taxed differently?
 
Personally, I'd consider a good old fashioned American C-Corp. People freak out about double taxation but that can easily be managed you see. If your corporation doesn't make a profit then your corporation doesn't pay taxes.

Why would you not run a profit you ask? It's really just a matter of spending the revenue accrued by your corporation on employee salaries, fringe benefits, dividends, and capital assets that will help your corporation grow.

The flexibility of a C-Corp far outweighs the extra bookkeeping and reporting required IMHO. Plus it's worth the experience of running a C-Corp when you consider that the Fortune 500 (mostly if not all C Corps - my guesstimate) account for 60% of America's GDP. Go where the money is... $$$.
 
It doesn't matter if you use your home address as the company. In CT I have my home as my business address. Also for your concern about the money in the account, the whole point of the LLC is they cannot touch personal assets so just leave the minmum that your bank requires in the account to avoid fees.
 
rgordon83 said:
I'm in IL and my lawyer and act both told me to do an S-corp. but i heard from other people to do LLC. i ended up doing S-Copr, but not sure yet if it was a smart move.

Incorporating is pretty cheap though, i paid my lawyer a few hundred bucks, including the state costs to file...
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They probably thought you would save some $$$$ on Self employment taxes (currently at 15.3%) Take a small salary (subject to se tax) and the rest in a distribution which is not subject to SE Taxes. It depends on your situation but it can save you some cash to set it up this way. Plus with an s corp it is easier to transfer to a c corp election if you so choose to do so.
profitaddiction said:
I've been looking at establishing an LLC (in Illinois) and have a few questions:

1. Does it matter if I use my home address as the companies? I'm pretty sure that shows mixed interests (not sure if the 'corporate veil' comes into play, but it would make sense) and might not be the best idea. Should I get a PO Box as my businesses?

2. I understand that it's 'Limited' Liability, so do you only keep a small amount of monies in your business accounts? Does that even matter?

If anybody can help, I would love it.
Click to expand...

The best advice has already been given. Get advice from an accountant/attorney.
 
miketpowell said:
^^ The entire point of setting up an LLC is for tax benefits and protecting your money, ie you do something naughty and get your ass sued/fined it's the LLC that gets it and only money in the LLC is at risk. Money you pulled out is nice and safe.
Click to expand...


That's part of the benefit, but not the entire point.

Taxes are most people's #1 expense every month. Buying some shit you need (computer, transportation, business lunches, etc) through your llc is a business expense and can be written off.

Yes, cover your ass with a corp
Yes, milk every dollar you can before uncle sam wastes it.
2 sides of the same coin.
 
miketpowell said:
^^ The entire point of setting up an LLC is for tax benefits and protecting your money, ie you do something naughty and get your ass sued/fined it's the LLC that gets it and only money in the LLC is at risk. Money you pulled out is nice and safe."

^^Def not true.^^

I would talk to an CPA about what is best for your situation as far as tax advantage goes and an attorney to talk to you about how to best protect yourself and your assets.
Click to expand...
 
profitaddiction said:
I was looking at LegalZoom and you can use them as the "registered agent" - However, it still asks for a "Business Address" which I assumed I could use a PO Box and then declare them as my agent.

What you think?
Click to expand...
I set a LLC up just this morning with LegalZoom. There is a $179 fee if you use them as the registered agent. However, the registered agent's address is public so if that worries you, pay the fee and use them as the agent.
 
erect said:
That's part of the benefit, but not the entire point.

Taxes are most people's #1 expense every month. Buying some shit you need (computer, transportation, business lunches, etc) through your llc is a business expense and can be written off.

Yes, cover your ass with a corp
Yes, milk every dollar you can before uncle sam wastes it.
2 sides of the same coin.
Click to expand...

Volume10 said:
miketpowell said:
^^ The entire point of setting up an LLC is for tax benefits and protecting your money, ie you do something naughty and get your ass sued/fined it's the LLC that gets it and only money in the LLC is at risk. Money you pulled out is nice and safe."

^^Def not true.^^

I would talk to an CPA about what is best for your situation as far as tax advantage goes and an attorney to talk to you about how to best protect yourself and your assets.
Click to expand...

Yes you are both right. I didn't write that well at all.

The point of my post was to talk to a professional about it and figure out what is best for you. There are numerous benefits and draw backs to the tons of different ways things could be set up. The key is to find a professional that knows wtf they are doing to help advise you of your options and when you make a decision get everything set up completely kosher.
Click to expand...
 
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