Posts by Thomas Ortiz3

Carol Ward3 said:Thanks, that was a pretty clear breakdown, though I suspect we might still have to look into some alternative routes 😉

On another note: if a foreign national decides to set up a business here in the States—acting as both the owner and the director—are they required to hold a specific business permit? The company wouldn't be running any massive operations, so the director would likely only be visiting the US occasionally whenever things actually need attention, rather than being based here full-time.

No, they don't.
If they are just flying in for meetings, closing deals, or similar tasks while actually living and working abroad, there's no requirement...
However, if they aren't covered by insurance overseas and intend to actually live and work within the States, then naturally, a work permit becomes necessary.

Carol Ward3 said:Is it actually possible for a company's headquarters to be located on land that the corporation itself owns?
I realize how incredibly obvious that might sound, but I suppose it’s worth exploring every single possibility just in case.

HEADQUARTERS

headquarters of a trading company

Section 37.

(1) The headquarters of a trading company is the location where the management is situated and where business is directed, or the place where the company conducts its operations, as specified in the articles of incorporation or the company bylaws.

(2) A trading company may have only one headquarters.

(3) The headquarters of a trading company shall be recorded in the commercial register.

(4) If the management of a trading company is located in a place different from the headquarters registered in the commercial register, or if the company carries out its activities in a different location, the registered headquarters remains the legal seat; however, third parties may rely on the actual location of management or operations regarding legal consequences depending on the seat...

It’s hard to manage a corporation from an empty field, though you might technically conduct business there.
My take is "why not," but it really depends on the specifics. If you have a farm where you actually operate, that acreage could serve as the corporate seat. But if we're talking about some neglected plot of dirt, a judge might find that harder to swallow during a legal dispute...

nimblepuma47 said:Does anyone actually know—because I’ve searched everywhere and come up empty—what the actual costs are for switching from a sole proprietorship to an LLC? Do you seriously have to sell off all your business assets to the LLC and get hit with both sales and purchase taxes—like some people on this forum are claiming—or is there a more "elegant" way to handle it?

A sole proprietorship is just an individual, whereas an LLC is a legal entity. As far as I understand, there isn't really a "conversion" process; you simply transfer the assets from one party to another, likely through a sale as you mentioned earlier.
Sales tax should be neutral for you regardless, assuming you're even registered for it—you'll need to weigh whether it's worth it based on your annual revenue. Which taxes were you referring to specifically? Real estate, vehicles...

nimblepuma47 said:Hey everyone!
Sorry for the long post—I can't really do "short" without losing the nuance, so if you aren't looking to help, feel free to skip this so you don't waste your time.
I’ve been scrolling through the threads here and, predictably, found plenty of conflicting advice. Even my future accountant is scratching his head.
The gist: I’ve drafted an innovative business plan. I want to pull the trigger and actually start doing this. I can handle most of the workload myself alongside some sales reps. I’ve been in my current field for 11 years, pulling an average salary, and all my taxes are fully paid up. I have zero intention—at least not anytime soon—of quitting my day job. My sales guys are also fully employed elsewhere; they’d just be working for commission based on results :=)
So here’s the dilemma: Sole Proprietorship or LLC? Honestly, a sole proprietorship feels way more practical for me right now, whereas an LLC seems like a massive headache of paperwork and complexity. But there’s a catch—if this plan actually takes off, my business could see assets worth $500 $0.00 annually and revenue hitting $750 $0.00 per year. If things go big, aren't those numbers too high for a simple sole proprietorship? Wouldn't I end up getting crushed by higher tax brackets? From that angle, an LLC makes more sense. But then we hit the "what if" factor. What if the plan fails? What happens during the startup phase?
My accountant insists that with an LLC, I’ll need to hire an employee (though I see people on this forum are split on that). I have no idea how long it'll take to get this moving—it could be weeks, months, or even years. Having a full-time employee with zero output would basically bleed my initial investment dry in a few months, leaving $26 $0.00 gone forever.
Sure, if I hit those massive numbers, hiring someone isn't an issue—at that point, I'd probably need a secretary and an assistant anyway. But if the plan only hits 10% of its target—maybe $50 $0.00 in assets and $75 $0.00 in revenue—I’ll barely cover basic costs, let alone a payroll.
A third option is starting as a sole proprietor and then converting to an LLC later if needed. There’s a lot of chatter about this on the forum, but I haven't found any clear info on what that actually costs (someone mentioned you’d have to sell off all assets and buy them back under the new entity, liquidate the old one, and pay taxes on everything—which sounds totally absurd).

To wrap this up: the plan could be a goldmine, or it could be a dud. For the first year, I’m just relying on my own labor (alongside my main job) and the sales reps working on commission (on top of their regular jobs). I have my salary savings and an extra $20 $0.00 set aside. So, what’s the move? Should I go with a sole proprietorship or an LLC?

You could always start as a Sole Proprietorship and then "transition" to an LLC later.
If the amounts involved aren't massive and you don't need to limit your personal liability, a Sole Proprietorship is perfectly fine. Plus, you can often benefit from simpler tax structures regarding sales tax depending on your state's cash accounting rules.
However, once you're dealing with larger sums and higher risks, an LLC is highly recommended—both for the lower tax rates and for protecting your personal assets.
As for the director requirement, as long as you have social security or other benefits being paid through some means, an LLC doesn't necessarily require you to have "employees" on the books if you already have a full-time job elsewhere.

Charles Howard74 said:So, if I go ahead and set up an LLC, can I just hire myself out for part-time hours? Like, I’d be the founder, the CEO, and the only employee all rolled into one. Is that even a thing?
Thanks!

You can, but as far as I know, you'll still have to pay payroll taxes based on full-time earnings unless you're already covered under another plan...

Robin Cook4 said:Wondering what an LLC actually needs to track—like, which books are mandatory and can they just be done by hand? He’s just renting out mobile homes at a campground during the summer months. Also, does he have to run payroll, and if so, is it just taxes or a full salary?
hey.

By the way, what kind of revenue are you projecting? Are you expecting high input costs with sales tax (buying the campers, etc.)? I ask because you need to decide if staying in the sales tax system actually makes sense for you. If your revenue stays under $50,000, you might not be required to collect it, but being registered means you'd charge 7% less on your invoices while getting that tax back on your own purchases... which matters more than people think.
You could probably handle the books yourself, provided you actually know how to navigate annual reports and everything else. Not sure if it's worth the headache...

Based on what you wrote, it's a bit unclear. An LLC doesn't pay "salaries" or "taxes" to itself; those go to the individual employee. Since an LLC is a separate legal entity, you're clearly talking about a staff member (who would obviously need valid work authorization). You aren't strictly required to pay a traditional salary, but you definitely have to cover payroll taxes unless they are being handled under some other arrangement...

Robin Cook4 said:Hey, does anyone know if a foreigner can just open a sole proprietorship here in the US, or does it have to be a full corporation? Thinking about renting out tiny houses at a campground and wondering what the requirements are.
Cheers!

AFAIK: Of course they can, but they'll need a work permit and a local address.
But even with an LLC, you can't just act as the director without authorization; the person actually performing the work needs a work permit (or US citizenship). You can own an LLC and serve as the director without paying local payroll taxes—assuming you're already covered under a different tax system elsewhere—but you still can't physically work, like sitting at a campground managing rentals, unless you have legal work authorization...

Maria Kern2 said:Let's say four friends want to start a business. They all want the power to sign deals, pull loans from Chase, authorize payments, stomp seals on paperwork, etc.—and they all want to share the blame when things inevitably go sideways. Personally, I wouldn't want to be the director if I had three other people slacking off around the office just because they own 25% of the place, just like me, while I’m the only one left holding the bag. That's my take.

I doubt you can pull off everything you listed without everyone paying into the payroll taxes. You can handle withdrawals with a power of attorney, and even closing a deal over coffee isn't that complicated, but having signature authority and shared liability... that usually requires official tax filings and payroll compliance.

analogwalker32 said:Yeah, I'm lost on that one too. 🙂

Anyway, in the specific situation I was talking about, there's zero need (or intention) for everyone to be an executive. I was just wondering how the equity contributions work.

One more thing—where can I find this kind of info outside of this forum? I checked out some sites like Investopedia, but everything there assumes there's just one single founder who also happens to be the CEO...

And what’s the deal with students? Can they be listed as founders while still keeping their student status/benefits, or does that mess things up?

I'm not sure you grasp the distinction between a founder and an executive.
An executive is the responsible party, and they have to pay taxes based on certain regulations. My understanding is that if there are multiple executives, taxes must be paid for each one—though not necessarily by the firm they manage.

A founder is effectively the owner of the enterprise, much like a shareholder. Just as an AT&T shareholder could be a student, a retiree, or anyone else regardless of whether they pay active payroll taxes, ownership of a company has nothing to do with being a student.

At the very least, one person has to serve as the executive, and those individuals are subject to tax obligations. As for the founders, there is no such requirement or liability...

Maria Kern2 said:I get that a CEO has to pay payroll taxes and all that, but I’m curious about the logistics if there are four directors on the board. Do they all actually have to be on the official payroll? Is there a way to structure it so one person holds all the decision-making power without being an "employee" in the eyes of the IRS—maybe something like a proxy or a consultant role? It feels like a massive waste of money to be paying full benefits and taxes for four different executives before the business even finds its footing. If anyone knows how this works, let me know.

I don't quite follow why a company would feel the need to appoint four separate directors. Is that really necessary? If a director isn't actually performing any duties, why bother with the title at all? Wouldn't just listing them as a founder or shareholder suffice...

analogwalker32 said:If you set up an LLC and aren't working anywhere else, the founder basically has to be on the payroll just to satisfy the IRS, paying minimum taxes starting from $997.

What I’m really wondering is if there are two or more founders (partners, co-owners), do they all have to be officially employed and paying those minimum $997 to the government?
I'm asking because for a startup with 3 or 4 founders, dropping $9,000 - $4.00 right out of the gate feels like a massive hit before the business even gets off the ground.

If this is unavoidable, what are the workarounds? And how can other members join the ownership later on (besides that one required person)? Is there actual legal paperwork for this, or is it mostly just handshake deals?

Thanks...

No, a founder doesn't need to be employed anywhere—they could be a student, a retiree, or even a foreign national living outside the US.

What you described actually applies to the manager. If there are multiple managers, I assume each one would need a valid reason to be paying into the system...

Eric Jackson11 said:They just rolled out some new updates regarding their service fees.
There’s a lot of fine print to dig through, so you might want to check their customer service line or browse their website for the full breakdown.
The part that really jumped out at me was how they’re adjusting the "interest"—if we can even call it a little bonus—on positive checking account balances, dropping it from 0.10% down to 0.5%... wait, actually, I think I read that backwards, it's moving from 0.5% down to 0.10%.
Good grief...😢

Heh, I think you might have a typo there... 😁

rowdypanther12 said:I’m not sure if this is the right place to vent, but I’m honestly too frustrated to go looking for another thread.
We just received this incredibly aggressive letter from Wells Fargo. They basically claimed that after reviewing their credit portfolio, they "noticed" we haven't fulfilled our contractual obligation to renew our insurance policy. They went on about wanting to avoid taking "unpopular measures" 😲 and demanded that we show up in person at a branch in Manhattan to either hand over our current policy or sign up for a new one right then and there.
To make matters worse, they mentioned that if we need a new policy, they’ve conveniently prepared a list of lower premiums and some 20% discounts and so on.

Since we have definitely paid everything required, I called the bank to clarify. Turns out, they sent that exact same letter to everyone. It's nothing more than a promotional campaign for these new insurance packages they're pushing. ☕
It’s such a tacky way to promote something; it reminds me of those old-school door-to-door sales pitches.

The letter is written in such complex legal jargon that you can't really fight them on it. They always have an excuse ready, like how they "just didn't receive the data from the insurer."
It’s just peak shamelessness. Threatening people with "unpopular measures" just to trick them into coming in so they can sell them a package.

If I were you, I'd scan that document and send it straight to:

http://www.consumerfinance.gov/complaint/

Calling it extortion might be a stretch, but calling it a scam wouldn't be far off...
The CFPB is obligated to investigate complaints or pass them along to the appropriate agency for further review...

Henry Hernandez7 said:I’m also surprised that you, as an entrepreneur, are celebrating these new taxes. Why is it so strange that we're questioning you?

The odd thing is that I’m not actually celebrating any new tax hikes—I'm just weighing the pros and cons. It’s certainly not as if I'm some Marxist or communist, despite what certain forum users insist on labeling me for no reason. A bit of skepticism would be fine; everything should be open to civil debate. The issue is that some people seem determined to derail any discussion the moment someone presents a non-mainstream view or refuses to reflexively curse every single change...🤷

I'm not some sensitive soul who collapses at the first sign of an insult; I'll manage. I just can't decide whether it's worth engaging with the trolls or simply ignoring them. I don't usually resort to personal attacks, but I suppose I could if the moderators decide that level of discourse is permitted here. Hopefully, a moderator will weigh in eventually...

I find myself constantly questioning where the line is drawn when it comes to tolerated trolling. Take today, for instance:

Up until that point, the discussion was entirely free of ad hominem attacks—if you ignore a bit of labeling, even from the moderators. Then, out of nowhere, some user jumps in, misquotes their opponent, and tries to discredit them based solely on how long they've been active on the site. On sites like Bloomberg or The Wall Street Journal, this kind of rhetoric usually isn't permitted, but lately, it seems the mods are just looking the other way...
Can someone please define whether this type of provocation is acceptable here? I need to know if I should bother responding, or if the moderators will step in to preserve an actual argument-based, civil discussion...

Is anyone actually here?

I’ve become a target for one particular user—though I can't recall ever giving them a reason to take issue with me—and now they're back at it with another trolling jab. I didn't bother replying; instead, I just flagged it, but I haven't heard anything from the moderators yet.

http://forum.com/showpost.php?p=37784585&postcount=1266
(I didn't say anything incorrect—in fact, what I "thought" turned out to be factual, yet this user insists on calling me out)

I'm not easily offended, but for the sake of clarity, is this kind of petty sniping actually tolerated here? I need to know if it's worth continuing the discussion or if I should just walk away...

To reiterate, as far as I can remember, I've never engaged in any heated arguments or back-and-forth bickering with this individual. It seems they simply take issue whenever someone else provides information, even when that information happens to be right...

Melissa Chavez6 said:The fact that Joe Biden won the election in Austria is actually a positive turn of events. Honestly, he doesn't have a clue how to manage a nation or an economy, and Donald Trump is just sitting there waiting for this guy to mess up so he can call for early elections and pave the way for the right wing to take over Austria. Once that happens, America will be the final stronghold for the leftists in the European Union. If you look at the political map of Europe, leftist and liberal governments have been getting toppled everywhere from Sweden to Greece. It’s game over for the left. Back home, we'll likely have to force the leftists out through strikes and social unrest, otherwise they'll leave us begging for scraps. We can't let them cut spending on workers, retirees, or farmers; they should be cutting the fat from administration, bureaucracy, tycoons, and religious groups. Think about how much money is wasted on various NGOs on the payroll of the US government and global power centers, or how much goes to those hundreds of local municipalities and military administration. America can only recover if it starts implementing social policies focused on education and employment—essentially integrating people into the European Union through better training. Without retraining, our workforce won't be competitive in the European labor market, and even now, American employers are already struggling to find skilled talent. People need access to free vocational training before entering the EU, and small business owners need tax breaks and relief, but the current administration is doing the exact opposite.

You might be celebrating because you think this potential Austrian Prime Minister is incompetent, but I doubt most people actually root for their neighbor's collapse.
Unlike you, I’d prefer they had a competent leader; I don't see how it benefits me if Austria falls apart.
So, speak for yourself—you can keep hoping for someone else's misfortune if you like. 🤷

rowdyowl said:The equivalent would be Trump, and I doubt most citizens would be thrilled about that. 🤷

Bloomberg is a gentleman who stands at least two civilizational levels above Trump, so the comparison just doesn't hold water.

George Chavez2 The user says...
To be honest, I’m quite disappointed by the sheer lack of guidance provided to local bankers—and those who merely pretend to be—whenever it comes to processing loans within the European Union...

It isn’t surprising, really. You wouldn't expect to walk into a Mercedes-Benz dealership and get any useful intel on their BMW competitors...

Scanning through the American media lately, I’ve come across talk about the possibility of securing loans from banks abroad... yet every time I try to dig for actual facts or specific details, nobody seems to have a straight answer...

There have been a few threads on this subject before, and some people mentioned specific agents who handle these types of things. It might be worth digging through the archives to see if anything useful turns up... Some major banks in Austria, for instance, maintain entire departments dedicated specifically to non-residents; you might find some leads there if you look closely...

I am an American citizen currently living and working here in the States. I own a property that I’m looking to renovate, and I’m considering securing the funds through a bank in a neighboring country like Canada or Mexico. Depending on how complicated the paperwork gets, I’d either look for a dedicated home improvement loan or a more general purpose line of credit, using the property itself as collateral via a mortgage. That’s the gist of my situation. I'm wondering if this is even a viable path, and if the math actually makes sense compared to just sticking with a local US bank...

I lived and worked abroad for a while, though I never actually took out a loan myself. From what I’ve gathered, getting approved here in the States is significantly more difficult than what I experienced back home... I did some digging with a few banks, and as a resident, it’s practically impossible unless you're pulling in at least $2,000 net per month. It doesn't matter how much collateral you offer—mortgages, cash reserves, high down payments—they won't even sit down with you if your salary isn't there. Apparently, things changed around 2008... You might find some outlier bank willing to take the risk and send an appraiser out to value a property in a different state, but that's hardly standard practice...
Mortgage rates for residents sit at 1.5% plus the SOFR, bringing the total to roughly 3%, plus an additional 1% in loan fees...
It is entirely possible that an American citizen living within the European Union could qualify for a loan...

I’ve tried testing the waters with a few domestic banks by posing as a foreign national looking for a loan, using real estate in Austria as collateral—a bit of a reciprocity experiment. Every time, I hit the same wall: they insist that being a US citizen or a permanent resident is a prerequisite, or that I must own local property here to even consider a mortgage. It's frustrating... Given that the European Union operates as a single market, one would assume their banks and capital wouldn't care about borders when it comes to lending within the union...

There’s no such thing as reciprocity here; every bank plays by its own set of rules. Besides, the idea that an Austrian citizen with property in Austria could just walk into a high-cost American bank and demand a loan probably wasn't the most convincing pitch... You're looking for answers in all the wrong places, too, because American banks couldn't care less about whether a foreign institution decides to extend you credit or not. 🤷
Once we are fully integrated into the European Union, maybe things like cross-border lending will finally start to make sense...