Re: Part-Time ADC Business
[Re: TonyB2550]
#5189689
09/09/15 09:32 AM
09/09/15 09:32 AM
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Joined: Jan 2013
Posts: 32 OH
Eric Arnold
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There are lots of posts regarding this topic in the archives and I've written about it quite a bit in WCT Magazine and the Buckeye Trapper. The best thing to do is talk with an attorney AND a CPA about your specific situation. By law, CPA's are not allowed to create or suggest a specific legal structure as that is considered giving legal advice; however, unless you're working with an attorney who is also a CPA they will not be able to give you the tax ramifications for what you choose.
This is why I recommend talking with both and having the CPA "create" identical tax returns for sole proprietor, LLC, and S Corp using the same numbers (i.e., $100,000 gross revenue, $65,000 expenses, etc.) so you can actually see the differences in how you get classified by the IRS and how it effects the business bank account.
Having said all that and having had multiple companies that were sole proprietor and S Corporation, I highly recommend anyone starting a company always go the S Corp route. Provided you follow all of the requirements (i.e., separate bank accounts, annual meetings w/ minutes, etc.) you not only protect yourself and family but also get better tax breaks.
I'll be at the OSTA Convention Friday morning for a couple of hours but will have to be on the road by 2pm so if you're heading down as well and want to chat about this, feel free to look me up.
Eric Arnold Publishing Editor W.C.T. Magazine Editor The Fur Taker Magazine
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Re: Part-Time ADC Business
[Re: TonyB2550]
#5189963
09/09/15 03:29 PM
09/09/15 03:29 PM
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Joined: Jun 2013
Posts: 95 Florida
bjansma
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You really need to define what you want or may think that you want. If you want a business thats going to grow, and maybe be salable some day, or you have assets to protect, follow Eric's advice. If you are a broke college student looking for some side money but plan on doing something different with your degree once graduated, then buy a few traps and start handing out some business cards.
Either format you choose; general liability insurance is cheap in this industry and protects you and your customers in almost any worst case scenario you will run into.
Bob Jansma
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Re: Part-Time ADC Business
[Re: TonyB2550]
#5190169
09/09/15 06:32 PM
09/09/15 06:32 PM
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Joined: Jun 2013
Posts: 95 Florida
bjansma
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Thought I might catch some flack for that answer. I think I qualified my answer enough that it was accurate, and helpful.
Bob Jansma
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Re: Part-Time ADC Business
[Re: TonyB2550]
#5190498
09/09/15 10:15 PM
09/09/15 10:15 PM
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Joined: Jun 2013
Posts: 95 Florida
bjansma
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Incorporation is done to limit liability or for tax advantage purposes and doesnt have as much to do with how you relate to customers. I am an above described S Corp but still do business on a handshake.
You would have to be licensed in Indiana to do ADC here. It is a fairly simple test.
Bob Jansma
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Re: Part-Time ADC Business
[Re: TonyB2550]
#5190711
09/10/15 06:50 AM
09/10/15 06:50 AM
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Joined: Jun 2013
Posts: 95 Florida
bjansma
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Not at all.There are quite a few guys that have an Indiana license but dont live in IN. After you pass the test you fill out what counties you are interested in working and then they put you on a list. If they get a phone call requesting service in your area they spread the work around to the guys from that area.
Bob Jansma
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Re: Part-Time ADC Business
[Re: TonyB2550]
#5190763
09/10/15 08:13 AM
09/10/15 08:13 AM
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Joined: Jun 2013
Posts: 95 Florida
bjansma
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Write offs for expenses should can be done at any revenue level. Its easy to do and reduces your tax liability.
As far as incorporating goes it doesn't have as much to do with dollar amounts and more to do with liability reduction and to reduce taxes.
You can have a sole proprietorship and be doing $1million or an llc and doing $5k. But what happens if you get sued in either case? This discussion might have less to do with your animal removal side business than it does your other assets. What if you just inherited a million dollars in stocks. Under a sole proprietor, you screw up in a business situation and that is at risk. If you do your business under an llc, it shouldn't be, although there are ways to screw that up.
For taxation purposes... in a sole proprietor situation any profit(revenue minus expenses) is called income and subject to your tax rate plus as a small business owner you get to pay both sides of FICA and Medicare, around 15%. As a sub S, I am an employee of my company. The wages I pay myself get FICA and Medicare taken out like a regular employee. My business also pays me a dividend. That dividend is taxed at my tax rate but not the FICA or Medicare. It can be substantial.
It gets complicated and I am not an attorney or CPA although I use to do taxes. You really need to consult your own professionals but at least this gives you an idea.
Bob Jansma
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Re: Part-Time ADC Business
[Re: Paul Winkelmann]
#5192422
09/11/15 01:33 PM
09/11/15 01:33 PM
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Joined: Dec 2006
Posts: 21,049 St. Louis Co, Mo
BigBob
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DaveK, we all hope you get that first customer any day now. LOL
Every kid needs a Dog and a Curmudgeon.
Remember Bowe Bergdahl, the traitor.
Beware! Jill Pudlewski, Ron Oates and Keven Begesse are liars and thiefs!
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