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  • Hey all, just changed over the backend after 15 years I figured time to give it a bit of an update, its probably gonna be a bit weird for most of you and i am sure there is a few bugs to work out but it should kinda work the same as before... hopefully :)

setting yourself up as a business..

Zakaree Sandberg

Zakaree Sandberg

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Ok.. ive been working freelance for a while now, however.. i am not very good at keeping things business like..

who has set up their own corporation/llc/sole proprietorship or what not?

what type of business do you set yourself up as?


I was thinking LLC but im not sure.

can My name be the LLC? or do I need a business name..

if anyone has insight, please respond
 
You can be John Smith, LLC if you want to be. Best advise IMO is hire a lawyer to help you start. Sure you don't need to...
 
Shawn- LLC is by far the best for an individual starting out as it gives CORPORATE protection while maintaining "pass thru" advantages for tax purposes. both are benefits.

incorporating usually doesnt make sense until you are making 7 figures and need more tax write-offs.

I do everything with an LLC... its cheap efficient and easy to manage.

Forming an LLC in Oregon is $55 and super EASY... www.filinginoregon.com

A business license is about $100. (until you habe revenues, then based on profits and county)

The website has awesome resources and a complete guide of "Starting a business in Oregon"

I use a very expensive law firm for the studio (because I have investors) but you do NOT need a lawyer to file an LLC in Oregon. That is a waste of money IMO

EDIT_ DOH!, I thought I was writing to Shawn Nelson in Oregon!

California is a bit different, but has similar resources. A lawyer at this stage
is a HUGE waste of money... talk to a CPA or your tax guy... LLC's are for protection against law suits (you drop a red off a bridge and kill someone)

and mostly, for tax purposes.
 
Tim Whitcomb said:
Shawn- LLC is by far the best for an individual starting out as it gives CORPORATE protection while maintaining "pass thru" advantages for tax purposes. both are benefits.

incorporating usually doesnt make sense until you are making 7 figures and need more tax write-offs.

I do everything with an LLC... its cheap efficient and easy to manage.

Forming an LLC in Oregon is $55 and super EASY... www.filinginoregon.com

A business license is about $100. (until you habe revenues, then based on profits and county)

The website has awesome resources and a complete guide of "Starting a business in Oregon"

I use a very expensive law firm for the studio (because I have investors) but you do NOT need a lawyer to file an LLC in Oregon. That is a waste of money IMO

EDIT_ DOH!, I thought I was writing to Shawn Nelson in Oregon!

California is a bit different, but has similar resources. A lawyer at this stage
is a HUGE waste of money... talk to a CPA or your tax guy... LLC's are for protection against law suits (you drop a red off a bridge and kill someone)

and mostly, for tax purposes.
Click to expand...


I still appreciate it Tim :-). I need to do this badly. I still pay thousands$$ out of my own checking acct for gear that I never tax deduct or anything. I'm rather stupid that way. One of my goals for 2009 is to get me an LLC or something (I'm referring mostly to random gear, the Red is owned by my father's corp & that was done properly).
 
does oregon have the same tax benefits or lack of tax as nevada?
I was thinking of eventually owning a house in Oregon or washington.
I would have it as my primary residence (even though i wont really live there)
 
Oregon taxes are pretty high because we dont have sales tax.

However, Nevada corp is one of the best for protecting against shareholder law suits, so more and more public companies are designating NEvada.

Again, a CPA or Tax guy (way cheaper) will help you 1000 times more than a lawyer... UNLESS
you have investors... then you HAVE to have a lawyer for blue sky filings, and
securities compliance.

but for guys like Shawn, who need to capitalize that gear and depreciate it and establish write-offs against rentals and paying jobs.. an accountant is all you
need and a little research on the web.

in most states, LLC's are the most cost effective.

good luck!
 
Legalzoom helped me create my LLC. Yeah, costs $300, but I didn't have a headache setting it up. As soon as I got my documentation in the mail, I went to the bank and setup an account for my business. Couldn't be any simpler. I still buy gear with my own personal funds outside of what my LLC is making, since I don't have a credit card for my business yet, but I write it off as a personal loan to the company that needs to pay myself back. Let's just say my company owes me a lot of money...hehe
 
Legalzoom is an OK service, but not that great of a deal and you don't get a whole lot of help if something out of the ordinary comes up. Most states offer online registration of new business entities these days and if you have a fair idea of what you are doing, is a pretty good way to do it. You may want to consult an attorney in setting up a new business entity. I'd recommend making some calls, for simple business registration and basic start-up advice, most attorneys are not that expensive, you may find that you'll pay about the same as, or just a bit more than, Legalzoom and you'll get a lot more personable and better service, plus you'll then have someone to call if needed, other than a toll free customer service thingy. Lots of benefits to actually using an attorney. They will often let you list their address as your registered address for business registration forms. This is a big deal if you operate out of your home -- keeps people from looking up your home address.

Most states require that you have "LLC" at the end of your official business name if you are in fact registered as a Limited Liability Company. But most will also allow you to use a trade name in addition to that. So you could be John Smith, LLC and could file a tradename registration and pimp your business as "John's Big RED!" or whatever. Legal documents could be marked as "John Smith, LLC; DBA John's Big RED!".

Some states have different advantages or tax incentives for registering businesses over other states. Delaware, Colorado, Wyoming and a few others are very good for corporations as they have very strong anti-takeover laws (good if you will ever publicly offer ownership stock or will take on investment partners). The only 3 states I would ever consider registering a corporation in are Delaware, Colorado and Nevada. But we're probably getting ahead of ourselves there... Delaware is attractive for large corporations or those who expect to grow rapidly. Delaware courts are by far the most experienced in corporate law and resolutions, many new businesses seek that out hoping that if the need ever arises, they will most likely get a more practical or fair chance in the courts in Delaware than somewhere like California. I don't know if that's really true or not, but it's common thinking out there.

With all the identity theft and fraud out there these days, I highly recommend doing what you can to separate your personal identity from your business. Apply for a federal tax ID or Employer Identification Number (EIN). Then you don't have to give out your social security number on tax forms or other business documents. I also recommend setting up as an LLC vs. a sole proprietorship. You will have more liability coverage and an extra layer of protection if something goes wrong.
 
We have worked with The Company Corporation.

http://www.incorporate.com/

As for where to setup the company, I would do it in Delaware, thats where we did, they charge no state income tax if you do business outside their state.


A major factor of Delaware's preeminence is related to the fact that Delaware charges no income tax on corporations not operating within the state.
http://en.wikipedia.org/wiki/Delaware_corporation

Of course get a tax accountant involved for more details.
 
Darren Orange said:
We have worked with The Company Corporation.

http://www.incorporate.com/

As for where to setup the company, I would do it in Delaware, thats where we did, they charge no state income tax if you do business outside their state.
Click to expand...

I also used The Company Corp. to setup and get my EIN. But I have my business registered in MA for film tax-credit reasons.
 
Technically, LLCs should be incorporated where the business is operated. (E.g. if the office is in California and the business operates out of that, you should register the LLC in California.) At least that's what the lawyers that helped me form an LLC told me.
 
Garrett M. Smith said:
Technically, LLCs should be incorporated where the business is operated. (E.g. if the office is in California and the business operates out of that, you should register the LLC in California.) At least that's what the lawyers that helped me form an LLC told me.
Click to expand...

WELL... there are millions of loop holes, they clearly missed the PO Box loophole. I know a guy with a production company in the DC area who incorporated in Delaware, and he maintains a PO Box there for legal reasons apparently. All the mail from that box is just forwarded to another PO Box in VA.

Funny how the bigger the govt. gets, the more swiss cheese like it becomes :P

As for giving yourself a "personal loan" instead of taking credit, I highly recommend it if you can personally afford it. Why in the hell would you pay interest on gear that looses value the moment it's made? It's a bad idea. I worked for someone else when setting up my business and spent a good 30K of my own CASH getting it up and running, zero interest. That situation saved me big time, as it can take a very long time in my particular area, to become profitable in this type of business. It was the right move, I don't have any creditors hounding me for money I can't generate enough of, on their time table. I always say use credit wisely and in the right manner, but figuring that out is the trick it seems most can't do successfully.
 
It's much nicer to be in debt to yourself than to others...that's for sure...
 
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