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LLC for an online business?

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jrcannon

PARKED
Oct 11, 2009
5
0
8
Hello,
I live in California and run an online business without any physical products. It's a website with a membership feature, and that's where I get the income from. I would like to register an LLC for protection and need some help.
So, if I register my LLC in California I realize it would be easier since I only have paperwork to file once., and I wouldn't need a registered agent. The problem is, I see there is a $800 franchise tax minimum. My business doesn't make a lot, so I am trying to do this as affordably as possibly.

I see Nevada is pretty cheap and a good place to set-up LLCs. If I register a Nevada LLC, I am wondering if I need to register my NV LLC with the State of California as a foreign LLC because I live here, or because I do all my business online with no tangible products, would that not be necessary?

If I do set it up in NV, and registered it as a foreign LLC with CA, would I need to pay the $800 tax each year, or is that just for CA LLCs? Lastly, would the added protection and benefits of an LLC in NV be worth the extra hassle of filing the LLC there and registering it as a foreign one here?

What would you do if you were in my situation: living in CA, have a small business, and want the cheapest route possible????

Justin
 

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GlobalWealth

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I would form the LLC in NV or WY and elect to be taxed as S-corp. Due to the nature of your business, I would not register in CA. In order to get the full benefit of an LLC, you will need a really good operating agreement, or you lose huge benefits available to LLC members. It will cost you more up front to set it up properly, but the protection and cost benefit down the road will far outweigh the initial set up cost. Let me know if you need help with this. CA is one of the worst states to have a business and many of my clients come from there.
 

JordanAvery

New Contributor
Jul 24, 2020
11
7
12
Miami
I have my LLC registered in Nevada, but I'm running it from Arizona. It's almost exactly your case, and I did this mainly because of the 800$ tax. My LLC was created by IncFile, and I've been advised to do so because of the multiple benefits. Indeed, Nevada is pretty cheap, and it's a good place to set-up LLCs. I provide website security services, so no products are involved. It's been four years, and everything is going okay, I don't have to pay the 800$ and never had problems because of this.
 
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GoodluckChuck

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An LLC adds a layer of difficulty in identifying your assets in case you get sued.

It's also my understanding that if you mess something up, you're still liable even if your company is an LLC. It's when employees mess up that the LLC protects you.

Are these statements correct?
 

VINTALEADSBPO

New Contributor
Aug 25, 2020
5
2
2
Philippines
Hello,
I live in California and run an online business without any physical products. It's a website with a membership feature, and that's where I get the income from. I would like to register an LLC for protection and need some help.
So, if I register my LLC in California I realize it would be easier since I only have paperwork to file once., and I wouldn't need a registered agent. The problem is, I see there is a $800 franchise tax minimum. My business doesn't make a lot, so I am trying to do this as affordably as possibly.

I see Nevada is pretty cheap and a good place to set-up LLCs. If I register a Nevada LLC, I am wondering if I need to register my NV LLC with the State of California as a foreign LLC because I live here, or because I do all my business online with no tangible products, would that not be necessary?

If I do set it up in NV, and registered it as a foreign LLC with CA, would I need to pay the $800 tax each year, or is that just for CA LLCs? Lastly, would the added protection and benefits of an LLC in NV be worth the extra hassle of filing the LLC there and registering it as a foreign one here?

What would you do if you were in my situation: living in CA, have a small business, and want the cheapest route possible????

Justin
I think you can do it later and when your earning a lot then you do that registering because it not practical since product service you dealt with isnt tangible you should take advantage and much be focus first on how you will get customers if it's sign ups for membership or pay website services. If you have Skype or whatspps I can give you details where you can have more fast track tong et client and service no more finding directory this is what I did and people's are happy and earning a lot from it.
 

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