What does an LLC or Corporation do?
An LLC shields you from personal responsibility in case something happens to your business. That means that creditors can’t take your person assets from you in the event that your company gets sued, goes under, or any other financial misfortune.
What if I don’t get an LLC?
You run the risk of having your home, your car, your life savings, EVERYTHING being taken away from you.
When should I get an LLC?
We typically recommend forming an LLC when your company reaches the point that you are more likely to get sued.
One of the major events that can cause this is hiring on employees or bringing on partners. Once you hire an employee, you may become liable for a mistake they make. Or worse, there may be a falling out and they may sue you.
You may also want to form an LLC before that point if your business has a high deal of risk. This can come in many different shapes and forms, and you will have to make that judgement call.
Should I get an LLC or a Corporation?
An LLC (limited liability company) protects the personal assets of the business owner(s). For example, if your business gets sued (or entangled with other legal troubles), then typically your company’s assets can be taken. Your family home, your personal belongings, and your personal cash are shielded by the LLC.
With an LLC, you are taxed similarly to a sole proprietorship. This gives you a great deal of flexibility, but makes it difficult to have other shareholders.
It’s great for smaller companies, but not for companies who plan to go public or do business internationally.
S-Corps and C-Corps also afford you limited liability (similar to an LLC), but they are taxed differently.
They allow more shareholders, thereby making it easier for the company to go public.
Want more details? You can get a free consultation with one of our attorneys, where he/she will help you determine what is best for your specific company. Simply use the blue section at the bottom of this article to schedule yours.
How does it work?
1) Fill Out A 25 Minute Form
2) We Create Your LLC For You
3) You’re Protected!
How much does it cost?
Both LLCs and Corporations cost $99 for a professional attorney to form them. However, your state also requires fees for a business formation which will be required no matter who creates it. The state fees are different for each state, ranging from $40-$500 (the median is $102.5).
How much is it worth to get an LLC or Corporation?
An LLC’s worth is different depending on the company that it protects, and the likelihood of said business running into financial problems.
The traditional method of estimating the worth of an LLC is the company’s last 24-36 months average monthly income, add cash reserves and subtract any debts. It’s then multiplied by a factor determined by the company’s stability.