I recently hired CorpNet to incorporate a business for me: Big Entertainment, LLC. It was an awesome experience and I’m really glad I did it – and my only regret is that I didn’t form an LLC a long time ago.
FULL DISCLOSURE: CorpNet is one of my favorite clients, and I’ve been working for them as a freelance blogger and marketing copywriter since July 2011. So I’m not an unbiased source of information. But seriously, who else would I have hired to do this for me? I know the team at CorpNet and I trust them to get the job done right. This is the story of my experience as a CorpNet customer.
Here’s the thing: I already started a business back in 2010, working for myself as a freelance writer, but I hadn’t gotten around to incorporating a business until now. I don’t know what was holding me back from forming an LLC – procrastination? Aimless busyness? Fear of success? Unwilling to shell out the money to get it done, thinking, “I’ll never need to have an LLC – my business is simple and I’m never going to get sued, so why bother?”
Probably a bit of all four reasons.
But here’s where I made a mistake: I should have incorporated as an LLC a long time ago. Not just for the peace of mind and the limited liability and the credibility with customers, but because of TAXES.
I went to see my new accountant a couple weeks ago. (It’s already May 2012, but my 2011 taxes are still not done – long story. I am mortified.) This is the first time I’ve ever hired an accountant to do my taxes, because I finally surrendered and admitted that now that I’m a small business owner, my taxes have become way too complicated for me to do by myself.
My accountant, looking at the amount of money I still owed to the IRS, said, “Please tell me you have an LLC.” I said proudly, “I didn’t have one last year, but I do now!”
In response, my accountant held his head in his hands, weeping. (My accountant is very emotional. That’s one of the reasons why I like working with him.) He said, “If you had decided to form an LLC last year, I could have saved you THOUSANDS of dollars in self-employment taxes because we could have had you file taxes as an S-Corporation, and the tax treatment is different. Because if you’re a sole proprietor, you have to pay gargantuan amounts of self-employment taxes.”
(Apparently here in America, we believe that if people choose to quit their horrible corporate jobs and do something interesting with their lives, they should be punished for it by paying extra taxes.)
So that’s the number one most painful and regret-filled reason why I should have gotten around to forming an LLC a long time ago: I’ve been paying high taxes that could have been minimized by forming an LLC and filing my taxes as an S-Corporation.
(How does this whole LLC-filing-as-an-S-Corporation tax thing work? I have no idea. America’s tax code is so convoluted that we have to leave our business tax filings in the hands of trained professionals like my accountant. And on that note – this blog post does not constitute tax advice or legal advice. Seriously. Go talk to your accountant/lawyer/tax lawyer.)
So the point is: I’m really glad I finally formed an LLC. I wish I had done it a long time ago, and I’m glad that I hired CorpNet to manage my business filings because:
- Their service is prompt, efficient and responsive. My LLC paperwork was filled out and filed in a matter of days. All the details were taken care of, everything was 100% accurate, and I didn’t have to worry about any of it. I got my final paperwork in the mail as well as digital versions e-mailed to me by Milton Turcios from CorpNet.
- They helped me deal with a complicated situation that I totally would have botched if I had tried to handle it on my own. I needed to form an LLC with two DBAs because I have two different ventures and two different business websites that I wanted to include under the umbrella of my corporate structure: I’m a freelance writer, and I’m also a comedian. So I needed an LLC that would be a corporate structure for all of my business activities, whether I’m writing blog posts for clients or doing stand-up comedy shows on the road. It was great to have the extra “hand holding” that my particular situation required. I even got to talk to Nellie Akalp, the CEO! (OK, fine, in my work as a blogger for CorpNet, I already get to talk to Nellie all the time. But “real” CorpNet customers get to talk to her too.)
- I’m so relieved to have this done. Even though I’ve been running my business “all wrong” for too long, without having the protection of an LLC and without enjoying all the tax benefits that can go with that, I finally feel good about being on the right track. My family’s personal assets are protected from the worst-case scenarios of me being in business. My accountant says that next year he’s going to save me massive amounts of money on my tax bill, and now that I’ve formed an LLC I have a new spring in my step. I feel like the sky’s the limit for what I can do with my business. It’s not “just me” out there in the world anymore; instead, I have an honest-to-God company that is going to grow and be profitable and provide a comfortable life for my kids over time.
Do you want to feel this same kind of relief and optimism that comes from finally starting a business? It all starts with a single call to CorpNet. Start a business the right way, today – you won’t be sorry. And you’ll never have to see your accountant cry.