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It costs $500/yr to run an LLC (Incorporation/renewal fee, registered agent, and a P.O. Box), unless you have no assets and don’t plan to have any assets in the
by o-__-o 7y ago
It costs $500/yr to run an LLC (Incorporation/renewal fee, registered agent, and a P.O. Box), unless you have no assets and don’t plan to have any assets in the next 2 years then I would strongly recommend incorporating before you have any sort of liability.
All it takes is one oops at a client to have a $1m judgement hanging over your head. LLC (in your state, don’t get fancy) sooner than later. Business insurance is typically another $500-800/yr for software startups, but I wouldn’t recommend that until you have something to protect (like money in the bank)
- streetcat1 7y agoDo you happen to know how much for a Delaware C Corp?. I.e. not the formation, but year to yeat maintenance?
- aledalgrande 7y agoFor the pure maintenance of the company we spend like 300-400 bucks.
- streetcat1 7y agoDo you need a CPA or do you use tax software?
- aledalgrande 7y agoWe use Vcorp Services
- o-__-o 7y agoYou also need to maintain out-of-state business registration in the state you reside. I would not get fancy until you can afford a CPA to ensure this is all up to date
- encoderer 7y agoUnless you’ve studied it, you might be surprised to learn that as a principal an LLC is not offering you the kind of protection you imagine. It basically protects investors. IANAL but was surprised myself when one explained it to me.
- WillPostForFood 7y agoMaybe you misunderstood? The LL in LLC stands for limited liability after all. Other than your capital contribution, and assuming no fraud or incompetence, there will be personal liability protection.
- kd5bjo 7y agoPiercing the corporate veil is a thing, though. I don’t know the details as I’m neither a lawyer nor a company owner, but my understanding is that you have to keep your and your company’s assets and activities completely separate, which requires a level of discipline that many people don’t have. Similarly, as a single-person company, any action that could cause liability was presumably performed by you, personally. That makes it much easier for a litigant to sue you personally instead of/in addition to your company.
- WillPostForFood 7y agoAbsolutely true, and it is true regardless of whether you use an LLC, S, or C Corp.
- kd5bjo 7y agoIf none of the more complicated strucures will provide the liability protection that you're going to need, there's also the possibility of doing business as a sole proprietor/DBA. You get no protections at all, but the reporting requirements are much reduced (in some cases, just filing a 1040).
- o-__-o 7y agoThe second can only occur because of the first. It’s also why I said keep a bank ledger :)
- 300bps 7y agoIt costs $500/yr to run an LLC Your advice to register an LLC is very good. I’ll add: 1) Costs are very state specific. And if you register in the state you live in you can act as your own registered agent and eliminate a lot of the yearly fees. In my state I can register directly for $90 with the Department of State (of my state, not federal) and there are no recurring fees. 2) Follow the rules by keeping all finances separate or you might as well not have registered the LLC.
- o-__-o 7y agoDo not skimp on your llc. I said $500 to protect yourself. You can go the cheap route but then your name is associated with your business and scams come out the woodworks. Plus it’s hella unprofessional and You may miss out on contracts because you don’t meet their vendor reqs