Starting a LLC

[slipondajimmy]

What are thebest states to start a LLC and why. What are the advantages/Disadvantages of a LLC

 

[Jokez Guy]

sorry buts a LLC?

 

[RJ]

From what I know -- and unfortunately I don't have first had experience with LLCs, only Corporations, but the concepts as I understand them are similar.

There are incorporation companies that will act as your home office in states such as Nevada or Delaware so you can take advantage of the corporation-friendly laws in those states. However, most of the time you'll also have to register your business as a foreign company in your home state, which includes fees that will offset the advantages of starting your business in another state.

What specific benefits are you looking for by considering other states?

 

[forona]

My business is an LLC - based in my own state.. I'm not sure the reason you'd set it up elsewhere, but perhaps a few states have some big benifits..

An LLC is a lot like a corporation. It's just another type of business entity - the biggest benefit is in the name, Limited Liability.. meaning you would not be personally responsible in the event of lawsuits, etc.

Disadvantages - in WA state anyway, you have some yearly fees and renewals (about $175/yr), and a bunch of other documentation to deal with.. Taxes can get a bit confusing.. but the right software (quickbooks, etc.) can make it pretty easy to deal with.

 

[PolurNET]

what about a Ltd, any advantage? Actually, if someone can explain the difference between Inc, Ltd, LLC, Corp., Pvt. Ltd, I'd be very greatful, as I couldn't find much pertinent info on Google...

 

[slipondajimmy]

hmmm well I would like to hear other peoples thoughts. Thanks to everyone so far

 

[armstrong]

I have a Delaware LLC. LLC's are not taxed directyly; instead, profits and losses go directly to the owner/s, and computed on an individual level.

Compare this to a corporation that has to pay income tax; then when profits are distributed to the shareholders as dividends, the individuals concerned are taxed again.

The only disadvantages I can see with an LLC are:
- People associate Corporations with big biz, so having a corp instead of an LLC can make you look bigger than you really are. Sort of the same way folks look at .com vs. .biz.
- Its easier to distribute and transfer ownership with corporations, so if you think you'll become very big and go the IPO route, then you need a traditional corporation.

 

[slipondajimmy]

hmmmm well im gonna be bigger then Google so i guess i should be a corporation ...lmao Just playing. I just have had a idea for some time now and i think im ready to start it

 

[RJ]

Compare this to a corporation that has to pay income tax; then when profits are distributed to the shareholders as dividends, the individuals concerned are taxed again.

A similar tax benefit can be achieved by forming an S-Corporation. The yearly earnings pass directly through to the shareholders to avoid the double taxation. This is what I'm currently using for my company.

 

[slipondajimmy]

thanks again everyone. It clears up a few things. I will have to look into it further and see if i want to pursue this project.

 

[PolurNET]

Can anyone answer my question for clarification i posted above?

 

[RJ]

what about a Ltd, any advantage? Actually, if someone can explain the difference between Inc, Ltd, LLC, Corp., Pvt. Ltd, I'd be very greatful, as I couldn't find much pertinent info on Google...

When you form a corporation you have to give your company a name that identifies what form of company it is. So 'Inc' & 'Corp' are designations that indicate your company is a corporation. 'LLC' and 'Ltd' identify your company as a limited liability company.

 

[PolurNET]

I see... in both cases, it must be registered with the local government? Or is Ltd. good for a small business?

 

[RJ]

I see... in both cases, it must be registered with the local government? Or is Ltd. good for a small business?

The two types of companies we're talking about are Corporations and LLCs. They operate pretty much the same with just a couple differences.

Either one would be fine for a small business. LLC has less paperwork, but Corporations are better if you plan on having stockholders in the future. Do some reading up on the two types and you can pick the one thats right for you.

Link-> http://www.toolkit.cch.com/text/P12_4600.asp

When I decided to incorporate my company a few years ago, I found that S-Corporation was the best choice for me.

 

[jdk]

What would better protect you incase someone decided to sue you for some reason. Especially if you run websites that offer services and say data, etc. gets corrupt and you can't restore it for them i.e.) game sites they pay for usage or hosting

 

[Caveman]

Either one will protect your personal assets from a suite against the company. There are several things that need to be done on a yearly basis, mostly paperwork on meetings etc. that, if not done correctly, can allow someone to pierce your corporate veil and expose you and your assets personally to that liability. Consult with a competent business attorney and you should be alright.

Regards,
Mike

 

[andriegel]

IMHO, the best state is Wyoming:
Check here for more info: http://www.corporationstoday.com/index.html

(I am not related in any way to this company)

Good luck and best regards!

Andrew