Are you ready to take your side hustle up a notch? If so, forming an LLC could be the perfect option for you! Discover why it’s one of the top choices among small businesses looking to expand.
This article gives all the info about how different business structures work, details on what makes creating an LLC such a great idea, and how to take grow your business even more by developing an amazing digital marketing campaign. Ready to explore this great opportunity? Read on & get started today!
Different Ways for Structuring a Company
Starting a business can involve deciding on more than just the perfect name. You should also choose your ideal business entity to make sure you’re filing accurate tax returns! Among the many options, some of the most popular include Sole Proprietorships, Partnerships and Corporations – each with their own pros & cons depending on what suits your needs best.
Sole Proprietorship – This is where a single person is the owner of the business. The owner does not have any protection from personal liability for business debts.
General Partnership -This is the simplest arrangement where two or more people own a business. The partners do not have any protection from personal liability for business debts, or for actions of the other partners taken within the scope of the business.
Limited Partnership – A limited partnership has two types of owners: general partners (who operate the business, make the decisions, and have personal liability), and limited partners (who are basically investors who do not have the right to operate the business or make business decisions, and do not have personal liability for business debts).
For small businesses looking to protect themselves and save money, an LLC is a perfect solution! This legal entity provides all of the financial security of a corporation plus some fantastic tax benefits from a partnership.
Corporation – In many ways similar to an LLC, a corporation is owned by the investors (called shareholders or stockholders), who provide the funds, assets, or services used to operate the business. The shareholders elect a board of directors, who are primarily responsible for major business decisions. The board of directors also selects officers, who are responsible for the day-to-day operation of the business. In a small corporation, the shareholders may also be the directors and officers.
What is an LLC?
A Limited Liability Company is a type of business organization allowed by state law in the United States. Its structure combines the simplicity, flexibility, and tax advantages of a partnership with the personal liability protection of a corporation.
Owners of an LLC are called “members.” Members of an LLC can be individuals or other businesses, and there is no limit to how many members an LLC can have.
Benefits of an LLC
Ready to go from small business dreamer to savvy entrepreneur? Jumpstart your success with an LLC! Not only will you benefit from greater asset protection and management flexibility, but it’s also the perfect way for ambitious entrepreneurs like yourself who have big dreams. What are you waiting for – make that entrepreneurial leap today!
Easy to Setup
Forming an LLC is a simple and cost-efficient process. All it takes are some basic steps, depending on which state you’re in, to get your business off the ground with minimal help from professionals.
Get organized and stay unencumbered with an LLC. Did you know that forming one can save your business from the paperwork headache of yearly formalities? What’s more, because these are not corporations – recordkeeping isn’t as overwhelming. It’s a win-win for entrepreneurs everywhere.
Limited Liability
Owning an LLC offers a powerful layer of protection that keeps your personal assets safe. No need to worry about creditors coming for what’s yours – when you choose the limited liability company route, no longer do business liabilities threaten all that’s dear.
Tax Advantages
LLCs have a unique way of dodging the taxman – pass-through federal taxation. This clever system moves company profits straight to its members’ pockets, meaning they don’t get taxed at the corporate level. With this trick up their sleeves, sole proprietorships, partnerships, LLCs, and S corps can keep extra cash in their own wallets instead of Uncle Sam’s.
Management Flexibility
LLCs offer flexible management options to suit any business scenario. Members of an LLC can involve themselves in the company’s day-to-day operations or take a step back, handing responsibility for running their venture over to someone else – even if that person isn’t part of the LLC. Without needing a board of directors, these businesses are free and independent enough to chart their own course.
Boosts Credibility
A stronger reputation for your business is just a few clicks away! Forming an LLC can give you that extra touch of professionalism and style – something customers will recognize. It’s the perfect way to show people you mean serious business when it comes to your venture.
Disadvantages of an LLC
Although, forming an LLC is a great option for some businesses, there are some potential disadvantages of LLCs that might not make it a great fit for everyone.
Cost
When it comes to company formation, forming an LLC is usually a more expensive option than going with a sole proprietorship or general partnership. Your state filing fee could range from just $40 dollars all the way to $500 bucks. Plus, you’ll likely face additional ongoing costs like annual report and franchise taxes – so don’t forget that when making your decision.
Transferable Ownership
LLCs can provide greater protection when it comes to the transfer of ownership, but they come with a caveat: all existing members must sign off on new owners or changes in percentage. This means that shareholders need more than stock certificates – they require unanimous consent.
Investor Appeal
Big-time investors usually choose to put their money behind corporations instead of LLCs. So, if you’re anticipating your business needing a mega injection of funds down the road, it might be best to set up as a corporation – that’s likely where they’ll park their cash.
Is an LLC right for your Business?
In conclusion, creating an LLC for your business is an inexpensive and easy way to boost credibility, gain personal liability protection, and take advantage of any state and federal tax benefits. If you are looking to take the next step with your small business, creating an LLC is one of the best options.
If you are ready to create an LLC, the next step is to develop a digital marketing plan for your small business. A successful digital marketing plan should include a clear online presence, effective content creation, and targeted Google and social media ads.
If you have no clue where to get started, don’t worry. At Ceemi Agency, we worked with hundreds of small businesses to boost their online presence and increase sales. Check out our Digital Marketing 101 Guide if you are interested in learning more about how to help your business stand out online.
We have a team of marketing pros ready to grow your business. Contact us today for a free digital marketing consultation!