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- Van Pines, Staff Member
you probably shouldn't start an LLC for your online business today I'm going to share with you the five reasons that an LLC is not the way to go for your online business hi my name is Jim Hardin the founding attorney here at Hawthorn law will be help online entrepreneurs just like you to get your legal house in order so that you can focus on doing what you do best and that is building something that truly matters in the world today I'm going to be sharing with you the five main reasons that's not five that's ten the five main reasons you should not be starting an LLC for your online business just yet listen a lot of you out there want to get your legal house in order you want to protect your business you want to get things in order and forming an LLC maybe the first thing that you want to do if you're going out to start your online business but I'm here to tell you that forming an LLC is right for some people it's actually right for a lot of people but there are some people out there that for meenalla see is not the thing that when you want to do right away when you're just getting started and now I'm gonna switch to my other clothes because I had to refilm this intro that's kind of yeah that's what happened there the LLC's are not the end-all be-all of everything related to online business there's lots of reasons why you might not want to start an LLC you just yet listen here's the deal a lot of the information that's out there is either too generic it's too complicated or maybe you understand it but you you look at who's producing it and you're like who is this quack that's writing this video or that's doing this video on LLC's they I don't know what they're talking about there's a tremendous amount of money time and effort that's at stake if you get this wrong choosing when and how to set up an LLC this is a big legal decision this is not something that you should just go online and do without giving it any thought whatsoever I can't tell you how many times people come in to see me because they've made mistakes that could have been easily avoided if they'd just gone to see a lawyer from the beginning these are mistakes that will cost thousands of dollars to fix nobody wants to spend thousands of dollars on a lawyer I'm a lawyer I don't want to spend thousands of dollars on a lawyer we're gonna get out of here because I'm getting a little stuffy in my office here so let's let's take a walk and let's with reason number one that you may not want to start an LLC for your business and it's pretty easy it's basically that you're not making any money yet if you're not not making any money yet you definitely don't need to start an LLC because frankly you don't have any money to pay for it anyway we're gonna go outside that's my law firm right there in case you wondered if I was like legit it's just a beautiful day out today I got to come outside but reason number two that you don't want to start an LLC just yet is that you're not at risk of getting sued you don't have to worry about anything because nobody's gonna sue you for anything you don't have an a reason to form an LLC that's the big reason why people start LLC's to begin with they want to make sure their their personal assets are protected from some sort of lawsuits that might happen and if you're not at risk of getting sued then there's really no reason to start an LLC to begin with right and so reason number three kind of goes along with this if you have insurance in place that's going to help you in the event that you do get sued you might not need to form an LLC now this comes into place a lot of times when you're dealing with landlords and people that own real estate there's always the question with real estate do you form an LLC you do not form an LLC and it really just depends on personal situation how many rental properties you own and things like that but if you're in a business where you have some sort of insurance in place that you don't need to worry about getting sued then you might not need an LLC number four is kind of tricky here because it's a big mistake that a lot of people make when they're thinking about forming an LLC they want to form an LLC because there's things they think there's some sort of tax benefit to forming the LLC when in reality there is no tax bandit to benefit to forming an LLC you can actually form or you can actually operate as a sole proprietor and file a Schedule C with your 1040 that is going to give you the same tax benefits that you would have if you're forming an LLC now if I've got videos over here over here I got videos they talk about the benefits of forming alright so I had to cut the video off a little bit short before because my battery ran out number four was essentially kind of a trick question here it was because there's no tax benefit to forming an LLC so you really don't want to if you're thinking I'm gonna start an LLC because I'm gonna save money on taxes that is a bad thing to think about it's not gonna work that's just not the way it works it's there's no tax benefit you could be an LLC or a sole proprietorship your taxes are going to be exactly the same and LLC is all about liability protection and has nothing to do with them saving money on taxes now you can start a business to save money on taxes but the fact that you form an LLC has no bearing at all on how much you're gonna pay in taxes at the end of the year so the fifth reason why you do not want to start an LLC is because it's just too complicated for you if you're having a hard enough time trying to figure out how to set up your business get clients set up a website blog do some YouTube videos all these things if you're doing all that and you're just gonna try and throw an LLC on top of it you know just wait until you get some clients coming in the door you don't need to do it right away now if you've got a lot of money to spend and you want to do that by all means got hire lawyer or do it yourself but if you don't think you can do it yourself and you don't have the money to spend hiring somebody to do it properly don't waste your time or your money doing an LLC you know just on your own without any help because chances are you're probably gonna mess it up you're gonna do it wrong at some point down the road it's gonna come back to bite you you don't want to do it that way doing videos at home is really hard because I got a cat over there jumping around this is my daughter's cat he doesn't like me too much he doesn't really like anybody too much so at the end of the day when you're starting your online business you what do they want to make sure that no matter what you do you've got good advice that's helping you get to where you need to be so if you're wondering why I'm now with a light and the side drop behind me it's because I want to do this earlier I thought I was gonna do it earlier the battery kept dying I had to charge it kids got in the way life you know the whole thing now here we are at night I'm filming videos which is not where I wanted to be regardless of whether you decide to go with an LLC or not with an LLC or with the corporation or not with t
Thanks SoborK your participation is very much appreciated
- Van Pines
About the author
I've studied meta-philosophy at Asbury University in Wilmore and I am an expert in organic chemistry (outline). I usually feel touched. My previous job was real estate appraiser I held this position for 20 years, I love talking about gardening and kubb. Huge fan of Larry Miller I practice volleyball and collect handbags.
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