LLC or Sole Proprietorship

[GLADES]

I am think about starting a small service company in south florida.

My plan is that it will eventually grow into a larger business in time.

I have a regular full time night job which pays well, but the hours are starting to get to me.

My plan is to work both jobs and see what shakes out.

Which type of bussiness model would be better regarding taxes and fees? Which is annually more expensive? LLC or SP?

My understanding is that a LLC will give my personal assets protection by forming the entity and working for the entity.

Any pro / cons or any other good advice? Any clever advertising or marketing ideas?

[Hoover]

What is it you are trying to accomplish?  Do you expect family members or others to be a part of your business?  Are you looking to provide estate tax protection?

Generally, the LLC is much like a partnership where income flows through to the member of the LLC and you pay taxes personally on that income.  Some states, I do not know about Florida, typically will have a franchise tax on LLC revenues.  So, you would pay personal income tax plus a franchise tax.

It is really hard to give you advice without knowing more about how you want to structure the business.  Forming an LLC typically requires filing documents with the secretary of state of your state and the preparation of an operating agreement.  You may have to hire an attorney to prepare the documentation but that is not to say that you couldn't do it yourself.

There is some protection from liability by running your business through an LLC but you will need to keep current with the requirements of corporations and partnerships.  For example, you will want to maintain minutes of meetings of the members of the LLC among other things.

Sum and substance, I would need more information about what you want to accomplish by way of the structure of your business to intelligently respond.  Good luck.

Tom

[GLADES]

I want to start a pool cleaning service. The people involved presently are myself, wife and son. I do not want to purchase an existing pool route, I want to develop my own accounts. I expect this to happen over time, through advertising and other means, As I acculimate accounts, I will consolidate the routes by trading them to tighten up the territory.

I want to grow the business until I need to hire additional employees. I sure this will take a few years. I know that things will get more complicated when that happens.

At some point, I want to manage this business when it becomes large enough to sustain my family and ditch the night job. I will keep the night job for now because of the benefits and insurance.

I never thought about estate tax protection, could you please explain?

This is a new venture so I have to learn as much as I can before I begin laying down the money. I dont want to learn through expensive mistakes. Another issue is chosing a name for the company. There are alot of good names listed with the state that are in disulusion.

How many years do they maintain the rights? If I add or change one character of the name, will that suffice? Thanks

[daviscw]

I studied all of this in a Business Law class, but I've already forgot. However, I do remember that you can visit the Secretary of State's website to look up existing names. You'll also learn a lot about LLC's and Sole Proprietorships and what not whie you're there.