Business info needed...

[Eagle Eye 72]

I am looking at starting a company but don't know which business format to go with, LLC or Inc. Any financial gurus willing to give me some direction? I am starting out with kydex holsters and have been working on designs for other firearm related products and accessories. So I figure some type of liability protection for myself is prudent. Any info would be greatly appreciated. I have been in manufacturing using various materials like thermo formed plastics, polycarbonate, aluminum, fiberglass and composites, etc. Using both manual and cnc equipment for the past 20+ years. Thanks!

 

[BirdEyes]

From a tax and accounting perspective, an LLC for a small starting business is probably a good choice. You can always incorporate into an Inc. in the future if you are wildly successful. I image you're looking at just a few employees so this should prove more advantageous for you. To start with you can look at this article: LLC vs. Inc.: Which legal structure suits your small business? Good luck in your new venture.

 

[Mark williams]

I would suggest the LLC as well!

 

[bobsdent]

LLC and get a copy of a business plan and fill it out you will need it. You will need a lawyer and a CPA The lawyer can get your state and fed ID numbers without them you go nowhere. After that a good CPA that deals in small business not your dads!. Also a web site today is a must again someone who can get you set up with Go Daddy.com to get you where you need to be and a web designer are two different people. Good luck to you and remember if you work for yourself you only have to work half days the first twelve hours or the second.

 

[mikeltee]

Also look into an S-corp.

 

[SniperCJ]

I would disagree. From listening to Dave Ramsey for quite some time now Ive picked up quite a bit of his advice. I think your exposure to a lawsuit would be fairly small based on what youre doing. You might be better off with a Sole Proprietorship at first. Im not sure a LLC is necessary.

 

[Eagle Eye 72]

It seems to me that operator error can be blamed on the product. Jacket zipper or some foreign object gets caught in between the holster and trigger upon re-holster and blamo! I end up in court. Even with a "don't do any thing stupid" warning put in the holster that they have to physically remove before use, the way society is today they never want to take responsibility for their actions. As far as the LLC, from how I understand, and I may be wrong. Is it not a pass through situation? Unless there are multiple partners it acts as a sole proprietorship and all gain or loss is filed on my personnel Tax Return? Please correct me on that if I am in error.

 

[Eagle Eye 72]

Thanks bobsdent! I dont mind long hours if there is reward for it. Just getting tired of making somebody else rich with my sweat and hard work. lol....

 

[Eagle Eye 72]

So I have just read that as a sole owner of an llc I would attach schedule c on my personal income tax return. Anybody have experience with this?

 

[bobsdent]

Get in touch with a CPA that deals with small business. It wont cost much at all and it is worth its weight in gold. My friend went out of trucking business because of not saving for taxes . My brother in law a plumier also went belly up. I have been in business for 17 years and none took or asked for advice. you are doing it right keep it up Small Dents are our business call us at 262 993-0411

 

[Eagle Eye 72]

Thanks for the input gents! I was hoping I could do this myself, but looks like I will have to call on a pro. A wise man I used to work for gave me some good advice. "Do what you do well and pay somebody else to do the other stuff".

 

[jbjh]

Thanks for the input gents! I was hoping I could do this myself, but looks like I will have to call on a pro. A wise man I used to work for gave me some good advice. "Do what you do well and pay somebody else to do the other stuff".

The key to that statement is to be doing it. Always be moving forward. Don't let your plans stall out waiting to get things perfect. While you get the pros working on your legal docs, you should be looking at resumes, office space, etc.

Your business plan and business philosophy need to be written down so you can act on them. If you can not clearly describe your business to yourself or others in writing, you have little chance of getting contracts.

 

[Eagle Eye 72]

I hear ya jbjh. Will be starting out small as a single person venture. Hard to fund a business with no capital and living paycheck to paycheck. I have some side jobs coming in and some orders for a few holsters. Will be just turning that money back into materials and tools for a while. I have alot to do so I allways right things down. I have lists for my lists! lol... It also makes things more manageable to see them in one place instead of floating around in my head. It seems that every holster maker is weeks if not months behind so I think this is a good product to offer up first so I can fund the developement of the other projects.

 

[Handloader]

Also look into an S-corp.

+1
Make sure your claim ALL your equipment/stock/tools value (real value not what you paid for it) that you bought/have BEFORE you form the S-corp. As an owner of an S-corp you "loan" the S-corp the value of all the start-up assets. This allows one to deduct all the profit to pay back the owner (you....i.e.no taxable income).
That said S-corps have greater tax benefits over an LLC

 

[jbjh]

I hear ya jbjh. Will be starting out small as a single person venture. Hard to fund a business with no capital and living paycheck to paycheck. I have some side jobs coming in and some orders for a few holsters. Will be just turning that money back into materials and tools for a while. I have alot to do so I allways right things down. I have lists for my lists! lol... It also makes things more manageable to see them in one place instead of floating around in my head. It seems that every holster maker is weeks if not months behind so I think this is a good product to offer up first so I can fund the developement of the other projects.

Checklists are a good practice, but I was talking about clearly communicating with your customers in writing. The same goes for your lenders and business partners. Talk is cheap, but business documents define what a business is worth

 

[jbjh]

Also, good luck!

 

[Night Eagle]

you don't need an llc or a sub s corp to start a small business. in fact its more expensive for you to go that route. go to your county court house, fill out sole prop docs (prob less than $25.00), take that doc to the bank and get an account and your done. small business started. that should get you till you are actually making enough money to consider a sub s corp or an llc. if your not making money ie profit, it makes no sense to incorporate because you gain no benifet from it. legal protectdion from a llc is hollow...any good lawyer can pierce a corporate shell in a few hours...if you need business insurance, its not hard or expensive to put a million dollar policy in place, and nobody's gonna sue you for more than that anyway. at some point you will need to get state sales tax stuff done and all you have to do is call your state comptroller and they can walk you through that. I do recommend spending money on a good bookkeeper and accountant, as that will save you money in the long run.

you def need a business plan and it needs to be written. put all your numbers together and see if the business is worth messing with...if the numbers work, then your gtg

I have 3 successful business right now so pm me if you have any more questions...

 

[T2CH]

you don't need an llc or a sub s corp to start a small business. in fact its more expensive for you to go that route. go to your county court house, fill out sole prop docs (prob less than $25.00), take that doc to the bank and get an account and your done. small business started. that should get you till you are actually making enough money to consider a sub s corp or an llc. if your not making money ie profit, it makes no sense to incorporate because you gain no benifet from it. legal protectdion from a llc is hollow...any good lawyer can pierce a corporate shell in a few hours...if you need business insurance, its not hard or expensive to put a million dollar policy in place, and nobody's gonna sue you for more than that anyway. at some point you will need to get state sales tax stuff done and all you have to do is call your state comptroller and they can walk you through that. I do recommend spending money on a good bookkeeper and accountant, as that will save you money in the long run.

you def need a business plan and it needs to be written. put all your numbers together and see if the business is worth messing with...if the numbers work, then your gtg

I have 3 successful business right now so pm me if you have any more questions...

^^^This is the best advice so far! I can speak from experience as I started my business with $2K and hard work with no other job. Do not spend money you don't have on things like a lawyer to start your business. Just as noted above you can do everything you need to without it. Sole Prop. is the way to go at this point. You can move money without the paperwork and all startup costs are tax deductible as well as loans to the company.
Now, if you have a patent that needs to be filed that's a different story, you may want a lawyer for that.

 

[Eagle Eye 72]

I was leaning toward the llc primarily to isolate myself from a lawsuit. But with what was just said it sounds like that is a moot point. So, I will look into the liability insurance. Thanks night eagle, I may take you up on that....