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Is a CPA good enough for setting up an LLC?

jilla82

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I make 100% of my income online now, and really need to get organized.
Im starting to talk to manufacturers and they are telling me that having insurance is of utmost importance.

So I need someone that can get my taxes in order & help me setup the proper business entity.

Is a CPA correct for this, or do I need to sit down with an Attorney?
 
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jon.a

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I make 100% of my income online now, and really need to get organized.
Im starting to talk to manufacturers and they are telling me that having insurance is of utmost importance.

So I need someone that can get my taxes in order & help me setup the proper business entity.

Is a CPA correct for this, or do I need to sit down with an Attorney?
We used an attorney and warned the CPA that it was coming. But, we have to be real safe. And, we live in California, the rules are always more expensive here.
 

Merging Left

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You should speak with a tax consultant. A CPA wouldn't necessarily be able to help you with your taxes. Much of what CPAs do isn't tax related, and an attorney would be most helpful for answering legal questions related to taxation.
 

jilla82

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You should speak with a tax consultant. A CPA wouldn't necessarily be able to help you with your taxes. Much of what CPAs do isn't tax related, and an attorney would be most helpful for answering legal questions related to taxation.
isnt most of what they do tax related?
 
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exclusives88

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A CPA can help you with your tax return. I agree with jillia82 that most CPA with their own practice will do your taxes. The term CPA is so general sometimes...A CPA or Attorney can help you with setting up your LLC but I would consult with an attorney when drafting a partnership/operating agreement or tax related issues that are very technical
 

nskitts

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I have set up my own LLC before. Just draft an "article of organization" detailing who owns the company and then checking with the Secretary of State in your state to see if the proposed name of your business is being used by someone else in your state. Then you will need to get your tax ID for the entity from the IRS by using their online forms.
 

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While most people on this forum (and elsewhere) think that setting up an LLC is an easy process, the reality is there are numerous mistakes most people make when they do it themselves.

For example, if you are an online business - the state of organization is very important. Do you know which state is best and why?

Do you know if you should be member managed or manager managed?

Do you know how to draft an operating agreement to minimize or eliminate personal liability?

Do you know who to create an LLC to shield members and managers from public record for privacy and liability reasons?

For online business do you know that an offshore LLC or IBC may be your best solutions?

Do you know the difference between an LLC and IBC?

Very few people, aside from professionals (and many so-called professionals), know this information.

Unless you are running a lemonade stand, you should consult a professional.
 
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Shades

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While most people on this forum (and elsewhere) think that setting up an LLC is an easy process, the reality is there are numerous mistakes most people make when they do it themselves.

For example, if you are an online business - the state of organization is very important. Do you know which state is best and why?

Do you know if you should be member managed or manager managed?

Do you know how to draft an operating agreement to minimize or eliminate personal liability?

Do you know who to create an LLC to shield members and managers from public record for privacy and liability reasons?

For online business do you know that an offshore LLC or IBC may be your best solutions?

Do you know the difference between an LLC and IBC?

Very few people, aside from professionals (and many so-called professionals), know this information.

Unless you are running a lemonade stand, you should consult a professional.


I had a question about this. Im in PA. Thought about setting the LLC up in Delaware or Nevada. However, Since id have to have a agent in that state and foreign qualify do you still come out on top tax and money spent wise?

Really like the Series LLC structure on the surface. PA does not allow you to do this. Delaware does.
 

GlobalWealth

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I had a question about this. Im in PA. Thought about setting the LLC up in Delaware or Nevada. However, Since id have to have a agent in that state and foreign qualify do you still come out on top tax and money spent wise?

Really like the Series LLC structure on the surface. PA does not allow you to do this. Delaware does.

NV also has series LLCs.

I cannot answer your question as there is nowhere near enough detail.

If you have nexus in your home state, then you would need to register as a foreign entity in that state (you normally would have nexus if you have an operating biz).

But there can be other benefits like liability protections not necessarily available under PA statutes. It really depends on the situation.

Also it is a matter of scale. If you are concerned with saving a few hundred or a couple of thousand dollars per year, you aren't likely earning enough to justify the additional cost.

However if your business is profiting $100k/m, then it would be a marginal cost increase.
 

Shades

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Also it is a matter of scale. If you are concerned with saving a few hundred or a couple of thousand dollars per year, you aren't likely earning enough to justify the additional cost.

However if your business is profiting $100k/m, then it would be a marginal cost increase.

Thanks for the reply. This answers exactly what I was curious about. It seemed like you had to be doing a large amount of business for it to be worth it monetarily. Tho, just being able to go the Series LLC route may be worth it. I dont like the idea of just putting multiple DBAs under one LLC.
 
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theTAXpert

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I am a CPA in NJ and do LLC registrations as well. Most of my clients come to me for tax advice and the differences/benefits between types of entities. Depending on the type of business activity, I either do it myself or consult with an attorney that I use who's experienced and knows the NJ law.

Even if you don't use a CPA to open the LLC, you should always consult with one as there may be a need to go down the Corp route (S or C).

Hope that helps.
 

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Thanks for the reply. This answers exactly what I was curious about. It seemed like you had to be doing a large amount of business for it to be worth it monetarily. Tho, just being able to go the Series LLC route may be worth it. I dont like the idea of just putting multiple DBAs under one LLC.

To some extent it is a matter of scale, but I only used 100k/m as an example.

If your business has significant assets, but a low income, there are other ways as well. For example, you can have your asset (machinery, IP, etc) owned by a WY or NV LLC and lease it to your PA LLC. This protects the assets and shields them from activity of your operating business.

Series LLC's are a good solution to running multiple small businesses under one umbrella, but I would not own signfiicant assets (ie real estate, stock portfolios, etc) in one series while running an operating business in another series. It really needs to be structured in separate entities.
 

GlobalWealth

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I am a CPA in NJ and do LLC registrations as well. Most of my clients come to me for tax advice and the differences/benefits between types of entities. Depending on the type of business activity, I either do it myself or consult with an attorney that I use who's experienced and knows the NJ law.

Even if you don't use a CPA to open the LLC, you should always consult with one as there may be a need to go down the Corp route (S or C).

Hope that helps.

With an LLC you can elect S or C corp tax status while retaining the liability protection offered with an LLC.
 
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Shades

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To some extent it is a matter of scale, but I only used 100k/m as an example.

If your business has significant assets, but a low income, there are other ways as well. For example, you can have your asset (machinery, IP, etc) owned by a WY or NV LLC and lease it to your PA LLC. This protects the assets and shields them from activity of your operating business.

Series LLC's are a good solution to running multiple small businesses under one umbrella, but I would not own signfiicant assets (ie real estate, stock portfolios, etc) in one series while running an operating business in another series. It really needs to be structured in separate entities.


So it may then be a option, if needed, to start out with one LLC and just have different DBAs under that one umbrella. Then if one of the businesses starts to take off you can roll that into its own separate LLC. Im worried about this too early in the game lol, but just was curious. Thanks for the knowledge.
 

GlobalWealth

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Im worried about this too early in the game lol, but just was curious.

I don't know where you are "in the game", but certainly if you are a new business owner your first priority should be customers.
 

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