Starting an LLC: Where to begin?
in Business, Accounting & Taxes ·
ruggedcyclist74 said:Your wife can certainly start her own company; she doesn't need to be registered as an employee of her own LLC since her primary employer is already covering her social security and tax withholdings, so she's free to work.
As for getting paid, if the work is just occasional, she could potentially pay herself through contract work, though most people simply distribute the profits the business makes during the year. You can also issue yourself quarterly profit distributions throughout the year...
If she does lose her job at the salon, she won't be eligible for unemployment benefits, and she'd essentially have to register herself as an employee within her own company to handle things.
I appreciate the insight, ruggedcyclist74. What’s the setup look like if I’m the one holding the ownership? In this scenario, we both have full-time jobs elsewhere, so we’d both be working for other companies while I act as the owner of this venture, which wouldn't have any other employees. Since I'm not in her field (she's a cosmetologist 🙂), she could work under my entity, and I could pay her through contract work when things pick up. Or, theoretically, she could volunteer her time initially, and then I'd just distribute the profits later on. Essentially, we just need a way to operate legally on a part-time basis while we build up the brand and test the waters. If it takes off, great; if not, we haven't lost much. We want to keep overhead low and stay completely off the radar of the IRS.
Thanks
Best,