Confused about how to set up your startup? We’ll make it easy for you: LLC. There’s no reason to complicate the process when there’s one clear path. Need convincing? Here are 5 reasons that an LLC is the best option for your start-up:
- Pay Less Taxes. Want to keep more of your earnings? An LLC is for you. LLCs may choose to be taxed by whichever method is most beneficial to them going forward, and this can be changed as the business changes. By default, an LLC as a business entity doesn’t pay taxes, meaning you’ll pay only pay taxes on your personal gains from the business. This is especially important in the beginning of your startup, as most startups spend more than they earn in the early stages of the business. If your business is formed as an LLC, you can pass any losses straight through to your personal tax return. Always consult with a CPA to ensure your have elected an optimal tax status for your business.
- Make changes easily. Unlike the complicated formalities, bookkeeping, tax filing and other regulations that other entities demand, an LLC is relatively easy to maintain. It’s also easy to add members without having to keep minutes or go through a board, which is what is required of a Corporation (although we do recommend keeping minutes). While you’ll want to talk with an attorney to make sure you understand the requirements of an LLC, the demands are typically less restrictive than other business structures. It’s important to have a conversation with a legal professional about the requirements of your LLC, as you want to make sure the courts recognize your business if legal issues arise and you need protection.
- Register hassle-free. LLCs are perfect for the fast pace of startups because they can be created quickly, especially if you use an attorney who is familiar with the LLC registration process. One you’ve registered your LLC with the state, you can get an Employer Identification Number (EIN) from the IRS and set up your bank accounts. Quick, simple and effective.
- Protect your assets. Startups need to establish the LLC structure to protect personal assets from being taken in a lawsuit directed at the company. The LLC provides separation between personal and company property, and allows for legal protection should conflicts arise.
The most successful startup founders know that time is of the essence. When making the decision to set up your startup, don’t spend unnecessary time wading through opinions, forums and third-party information. Talk to an attorney who can look at your situation, provide recommendations and set up the correct business structure so that you can spend your time doing what you do best: running your company. LexLaunch.com provides a variety of LLC setup options at reduced rates from typical attorney fees. Don’t waste time and money forming a business structure that might not protect your assets.Call the attorneys at LexLaunch.com at (816) 434-6610 or click here for more information to learn more about how to decrease risk and protect your small business.