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Noam Osband April 22nd, 2013 12:07 PM

starting an LLC
 
I'm making an LLC for my filmmaking endeavors. Should I meet with a lawyer to do this? Are there any ins and outs I want to consider or is this easy to do on my own? I know it's literally easy to set up an LLC but I wonder if there are nuances I want to consider that would make meeting with a lawyer wise.

thanks in advance,
noam

Chris Medico April 22nd, 2013 12:58 PM

Re: starting an LLC
 
It is as simple as it seems. The only advice that I suggest is to have only one member of the LLC management. That means the LLC for tax purposes is an extension of you as an individual and if you aren't going to have W2 employees it becomes real simple tax wise.

It would be best to discuss the situation with a tax person and/or a lawyer.

In my case an LLC with a single member was the way to go.

Mark Koha April 22nd, 2013 04:13 PM

Re: starting an LLC
 
As stated above, limit it to yourself. I had to do one through legalzoom for all the freelance work that I do and it was simple, just takes a couple minutes.

Don Bloom April 22nd, 2013 05:42 PM

Re: starting an LLC
 
Also check to see what if any cost is associated with registering with your state. In Illinois it's gets pretty costly pretty quick. Don't forget you tax ID both fed and state (if needed).

Jacques Mersereau April 22nd, 2013 08:14 PM

Re: starting an LLC
 
And remember, even though LLC stands for limited liability corporation, guess what? You can still be sued. Remember, lawyers challenge whatever laws exist all the time. You get hit with a lawsuit, and you are named in it, you can wave all the paperwork around, but you'll still need to hire a lawyer to defend you interests.

Having just gone through a bit of trying decide whether to LLC, incorporate, partnership, etc., we decided to just go with a DBA, which cost $10 here in Washtenaw county.

YMMV.

Mike Watson April 22nd, 2013 10:26 PM

Re: starting an LLC
 
^^^ I also found this to be true, and did not end up registering an LLC. It is not difficult for someone to see through a one-member LLC and sue you, instead of the asset-less LLC. In addition to not having to pay to register the LLC and keep up the LLC, I also pay only once to have my taxes done (as a sole proprietorship, just one set of taxes) and I can move cash around as need-be.

Al Gardner April 23rd, 2013 06:00 PM

Re: starting an LLC
 
What are the tax pros or cons as far as LLC VS Sole Proprietorship VS DBA?

Do you pay self employment tax with all of them?

Mike Watson April 24th, 2013 02:11 AM

Re: starting an LLC
 
In short, consult your accountant. To be more verbose, I don't believe there is any difference, but you are interchanging terms there that are not interchangeable. i.e. you can be a LLC or a sole proprietor, and still be a DBA.

Jim Michael April 24th, 2013 04:48 AM

Re: starting an LLC
 
There are financial reasons for business entity choice that might make the LLC the better choice, so it's worth spending a few minutes over lunch talking to a CPA about it.

Chris Davis April 24th, 2013 09:08 AM

Re: starting an LLC
 
Quote:

Originally Posted by Al Gardner (Post 1792183)
What are the tax pros or cons as far as LLC VS Sole Proprietorship VS DBA?

Do you pay self employment tax with all of them?

"DBA" is not a type of business structure, like corporation, LLC or sole proprietor. But generally when a small business owner says they're a "DBA", it means they're a sole proprietor.

LLC and Sole Proprietor are virtually identical as far as taxes are concerned. The sole proprietor has a few small advantages (such as the ability to employ your minor kids without paying payroll taxes.)

Jacques is correct, an LLC doesn't automatically shield you from personal liability. In fact, if you're a lone gun with no employees or associates, an LLC will give you virtually no protection. Why? Imagine this scenario - you are at a shoot and leave a light stand in a walking area. Someone trips on it and is seriously injured. It doesn't matter if you have "Sunshine Productions LLC", because YOU were negligent in leaving the light stand in a dangerous place, therefore YOU personally will be held responsible.

Tim Polster April 26th, 2013 09:20 AM

Re: starting an LLC
 
That is where a lawyer would have to say if "You" were responsible or your "LLC" was responsible. The idea of an entity is to be the thing that gets the attention instead of your personal assets. There will always be responsibility but that is why professional outfits carry insurance. The key is to not lose your home and IRA if an incedent happens!

BTW, LLC stands for 'Limited Liability Company', not corporation.

Steve House April 28th, 2013 03:05 PM

Re: starting an LLC
 
Quote:

Originally Posted by Tim Polster (Post 1792671)
That is where a lawyer would have to say if "You" were responsible or your "LLC" was responsible. The idea of an entity is to be the thing that gets the attention instead of your personal assets. There will always be responsibility but that is why professional outfits carry insurance. The key is to not lose your home and IRA if an incedent happens!

BTW, LLC stands for 'Limited Liability Company', not corporation.

And as I understand it, the "Liability" referred to in the name that is being limited is liability for the normal business indebtedness, payroll, taxes, etc of the business entity, not liabilities arising from negligence acts etc on the part of the owner.


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