Forums: Discussions for entrepreneurs and small business.

I am trying to determine whether to switch from a Sole Proprietorship to a LLC 

I resell small electrical appliances through an online store

I purchase them from a distributor in the US and they are manufactured in Asia

I stock and ship some and I some I have drop shipped

I am the only owner and worker in my business.

I have product liability insurance for $500,000 and a $1,000,000 personal liability policy

Is my liability from an injured customer the same whether I am a LLC or a Sole Proprietorship?

Last year my Sole Proprietorship made a taxable profit $75,000 and I paid @ 15%  for the SP Tax or @ $10,000

Could I have paid less tax if I were a LLC or other kind of Corporation?

How much higher are fees and taxes and cost to prepare the reports for the fees and taxes for LLC vs. a Sole Proprietorship?

Per my knowledge through my mentors
and my CPA, you should be an LLC
to protect your personal assess from
your business assess. This the number
one reason to be LLC.

I do believe there are differences with
taxes, but that would be something you
would want to discuss with your CPA.

Inquire with your CPA and if they`re not
providing you with direction, you may want
search for one you feel that is knowledgeable
and has your best interest at heart.

I was referred to an AWESOME CPA who
I feel comfortable with and who is very savvy.

Won`t Be Denied!
C.F. Jackson

Lighting 1,000 Dreams Worldwide

For a sole proprietorship, you are holding too much risks. You should convert it to a LLC ASAP.

RicDee, as it was noted already LLC provides substantially better legal protection than a Sole Proprietorship.

From the tax point of view, a member [of a single member LLC] files the very same schedule C that a sole proprietor would file and the net income from of the business will be subject to the same taxes: income tax (after aggregation with other personal income, if any, on form 1040) and self-employment tax.

Ecotaxpro LLC

www.ecotaxpro.com

DBA Startup Specialists

www.startup-specialists.com