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<blockquote data-quote="Brian jojade" data-source="post: 92405" data-attributes="member: 211">Re: Operating as an LLCIf you have no employees, forming an LLC offers little to no benefit.&nbsp; There is no liability protection if YOU do something stupid.&nbsp; ie, if you set up a speaker and it falls, you can be sued personally, as well as the company.&nbsp; Same thing could happen if you work for a company.&nbsp; If you do something stupid, you can be sued as well as the company you work for.If you have employees, then the protection is that a lawsuit for something stupid that the employee does limits the liability to the corporation. They can&#039;t take your personal assets.&nbsp; If you run as a sole proprietorship and have employees, they could.Financially, you could have some protection with an LLC if you went bankrupt.&nbsp; However, loans that have a personal guarantee behind them which would not have protection.&nbsp; Eg, if you used your house as collateral to get a loan for the LLC, if you went bankrupt, there goes your house.&nbsp; Where you would have protection is unsecured loans, such as terms with vendors to the company.Taxes to an LLC are the same as with a sole proprietorship, as the profits simply pass through to your personal taxes.&nbsp; Setting up an S corp can be extremely beneficial once you hit a certain threshold of income, as the corporation is taxes separately from your personal income.&nbsp; You can decide how much to pay yourself, and how much stays in the company.&nbsp; This can lessen the self employment tax, social security, etc.&nbsp; For small companies, the added burden and paperwork to run an S corp isn&#039;t worth the savings.</blockquote>

[QUOTE="Brian jojade, post: 92405, member: 211"] Re: Operating as an LLC If you have no employees, forming an LLC offers little to no benefit. There is no liability protection if YOU do something stupid. ie, if you set up a speaker and it falls, you can be sued personally, as well as the company. Same thing could happen if you work for a company. If you do something stupid, you can be sued as well as the company you work for. If you have employees, then the protection is that a lawsuit for something stupid that the employee does limits the liability to the corporation. They can't take your personal assets. If you run as a sole proprietorship and have employees, they could. Financially, you could have some protection with an LLC if you went bankrupt. However, loans that have a personal guarantee behind them which would not have protection. Eg, if you used your house as collateral to get a loan for the LLC, if you went bankrupt, there goes your house. Where you would have protection is unsecured loans, such as terms with vendors to the company. Taxes to an LLC are the same as with a sole proprietorship, as the profits simply pass through to your personal taxes. Setting up an S corp can be extremely beneficial once you hit a certain threshold of income, as the corporation is taxes separately from your personal income. You can decide how much to pay yourself, and how much stays in the company. This can lessen the self employment tax, social security, etc. For small companies, the added burden and paperwork to run an S corp isn't worth the savings. [/QUOTE]

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