varusword75 wrote:
Rava,
Quote:
I'm not too sure of the finer details either. The impression I got about the two is that even if you don't co-mingle funds for a sole proprietorship, it still counts as "your" money, whereas LLC you'd at least be able to keep the funds separate. Would be interesting what someone who actually has experience about the two has to say.
LLC's protect your personal assets against lawsuit happy money grubbing ambulance chasing leaches known as attorneys. I'd say a few hundred bucks is worth it.
Edited, Jul 12th 2011 9:24am by varusword75 Generally, if you live in a state where there are community property laws, a community interest will always inure to the spouse's benefit, unless the spouse disclaims any interest in that property or the the property was bought with separate property funds (inheritance, money you had prior to marriage, etc.).
LLCs, corporations and limited partnerships will only ensure that your personal assets are kept separate from your business assets so long as you maintain the business formalities that are required by law. And even then, any attorney will throw in alter ego liability because then it will be up to you to prove that you didn't commingle funds or property. That's why insurance and bonds are so important, depending on your line of business.
Elne, do not just check with just Social Security on what rules you need to follow, check local, county and state laws as well. There are thousands of resources that you can pull information from, and for a small side business, best bet to start with is with the Small Business Administration. They have checklists that you can use to see if you're complying with everything. It's better to be proactive instead of finding that you're not compliant with some arcane rule that you didn't know about because the penalties and fees can be horrendous to correct a deficiency, particularly now almost every government agency on every level is grappling with a budget issue.
Edited, Jul 13th 2011 9:30am by Thumbelyna