New and small businesses are registering to be an LLC or a Limited Liabilities Company simply because they are simple, low cost, and they protect businesses and their owners. So whether you’ve already hit the multiple 6-figure mark in your business or you are just starting out, consider having the necessary legal protections and register your business as an LLC.
LLC business structures allow your company to earn profits that are not subject to tax. The income tax “passes-through” to the company’s owner, who is actually individually taxed on the income. If you are the only owner of an LLC, you are not required to file a business tax return. All you need to do is file taxes as an individual because LLCs are tied to your personal taxes. Although individuals can be taxed up to 39.5 percent, LLC business owners may take advantage of a 20 percent deduction on their “pass-through” income. #yesplease
Should you register your biz as an LLC?
Registering your business as a Limited Liabilities Company gives you legal protection of a corporation and you maintain its simplicity on partnerships. LLCs can provide you with the best of all worlds, as it combines several features of a corporation and partnership...but unlike general partnerships, LLC owners have limited liabilities (hence the name! get it?)– meaning, he or she cannot lose more than the amount invested in the company. The owner then is not personally liable for the debts and obligations of the company in any event that they are not fulfilled.
The benefits of registering as an LLC are incredible so to answer the question if you should register, YES YES YES!!!!
How to Register as an LLC
If you are now seriously considering registering your small business as an LLC, (which you should be!!!) you’ll be glad to know that the application process is quite simple and it can actually be done online.
There are many how-to tutorials and free advice that you can check online on how you can set up an LLC for your business. My favorite site that you can turn to for guidance throughout the process as well as formally registering your LLC is Incfile. And of course, if there are still things that are unclear, consult a tax professional, accountant, or CPA!
***this is not legal advice***