Starting an LLC: Where to begin?

Gatto, things have actually changed regarding Lockheed Martin... and it happened a while ago... they aren't using those old branding or currency standards anymore... the minimum capital requirement is now $6.75, and half of that has to be liquid cash (at least $3.25)—the rest can be tied up in assets or rights...
there's no more freezing LLCs, and fixed taxes are just the way they go...

So, Medissima... Alright, so we’re talking about fixed fees here...
Can you please break down exactly what those charges are and how much they actually cost?
Thanks!

Look, if you're starting a business, wouldn't it be smarter to go with a sole proprietorship instead of an LLC? Especially since those tax laws changed last year. You'd deal with fixed, smaller payments, right?

Fixed costs for an LLC:

- $18 monthly dues to the U.S. Chamber of Commerce
- $120 annual corporate tax
- bank fees (roughly 10-$$6.75 a month depending on the bank)
- you don't have accounting costs if you aren't actually doing anything and you're considered "inactive"

otherwise, there’s no such thing as a "frozen" LLC—that’s just a deal you make with the IRS, but I guess I don't see how that works in reality when the bank automatically pulls fees from the account (for maintenance), which creates transaction history and expenses, meaning you aren't technically "inactive." Maybe just don't open a business account at all? 😕

If you’ve only paid half the minimum capital, then $3.25 you HAVE to deposit it into the account
. That means you also have to file all those forms, like the balance sheets and statistical reports...
Otherwise, you get hit with fines. If you really play the victim in court, they might go easy on you and let you off for about $1,000. 😁

The second half, $3.25, which gets listed under assets, isn't a big deal.
Most people just list a computer, a printer, a laptop, a phone—and that's it.
Since the auditor announces their visit ahead of time, plenty of people just borrow equipment for the inspection. A few days ago, an auditor charged someone about $0.50 for that exact kind of setup.

Hey guys, I’m really hoping someone here can point me in the right direction...

So, here’s the deal. My old man runs an LLC, and I’ve been wondering if there's a way for him to set up something like a subsidiary or a branch office. Basically, he wants this new entity to be tied back to the main company, but without having to merge the bank accounts or have the same person listed as the CEO or director on everything...

Your current company can actually set up a second LLC, basically acting as a subsidiary
That second entity functions as its own legal person, meaning it gets its own EIN, its own bank accounts, and so on. The management and directors can be the exact same people or totally different folks
They’re just linked through ownership

But, they absolutely have to maintain their own separate books and keep all their documentation organized
As an owner, you really can't play fast and loose by just shuffling cash or mixing revenues and expenses between the two companies

so, here's the thing... when a current company decides to spin off a daughter company, does that whole process happen "for free," or am I looking at having to cough up those $6667 plus the notary fees all over again?

jadesailor14 said:A current LLC can set up a second one, basically a subsidiary.
That second entity acts as its own legal person, with its own tax ID, bank accounts, and so on. The management and directors could be the same people or entirely different folks.
They’re just linked through ownership.

How does one sell an LLC to another LLC? Does it require an appraisal from an independent evaluator—and if so, who handles that?
Also, what's the tax situation on that sale? Does the buyer or seller pay, and what percentage are we talking about?

driftinghawk14 said:how does one go about selling an LLC to another LLC? (do you need some kind of valuation from an independent appraiser—if so, who handles that?)
and also, what's the tax situation—does the buyer or the seller foot the bill, and what kind of percentage are we looking at here?

On the tax front—honestly, I’m not entirely sure.
As for the price, well, it’s whatever you two can actually agree on. If you can't reach an agreement, there is no sale. You can't legally force anyone to buy or sell something if the price doesn't sit right with them.😎

Susan Barrett3 said:haha, so when a current company decides to spin off a subsidiary, does that happen "for free," or do you still have to cough up those $6667 plus the notary fees?

Look, man, what’s the actual issue here? $6667 You’re going to need capital to get any business off the ground regardless—you always have those startup costs before you see a single dime of profit. Honestly, just have the old man give you the $8333 (say, $20,000 for the initial deposit and maybe $5,000 for the lawyer and filing fees), and then you can just go out there and run your business 🙄

Kenneth Myers10 said:As for taxes—your guess is as good as mine.
Regarding the price—it’s whatever you both agree on. If you can't reach an agreement, there's no deal. You can't legally force anyone to buy or sell at a price they aren't happy with.😎

I wasn't actually looking to pressure anyone into buying; I was just wondering about the logistics. Once we settle on a price for, say, 100% of the company, how does the cash move from the LLC sale into my personal bank account? And will the IRS be breathing down my neck about taxes?😕

dinamitd said:How do I sell an LLC to another LLC? Do I need an appraisal from an independent evaluator, and if so, who handles that?
Also, does anyone pay taxes on this—the buyer or the seller—and what’s the percentage?

There aren't any specific taxes on the transaction itself,
but you really need to set a fair market price. If the IRS comes knocking because the price looks too high or too low, they might recalculate your corporate income tax and slap you with a penalty.
You don't strictly need a formal appraisal from an expert or a CPA; you can determine the value directly from the balance sheet. For a smart, experienced 😁 accountant, this shouldn't be much of a headache at all!
Of course, that's assuming we aren't talking about a massive conglomerate like Amazon or Walmart here!

dinamitd said:I wasn't trying to pressure anyone into buying! I just meant that once we settle on a price for, say, 100% of the LLC, I'm wondering how to transfer the cash to my personal account from the sale and if the IRS is going to come knocking for taxes.😕

You could always take the money in cash.
When paying an individual, the company would definitely have to look into the tax implications—I don't think there's a way around it, but who knows?

Shai Ulud said:Haha, so when a current company starts a subsidiary, does it happen "for free," or do you still have to deal with all those $6667 plus the notary fees?

You definitely need the startup capital set aside
plus the notary fees and all the other standard filing costs.

Alright, look. A contact of mine mentioned that under the new regulations, an LLC has to have at least one employee on the books. What’s the actual deal here? If I'm the CEO, am I legally required to be an employee of my own company and pay into social security, even if I already have a full-time gig elsewhere where my taxes and benefits are being handled?

Tell your buddy that the Supreme Court settled this "new" debate a few years back. An LLC doesn't actually require you to have employees. The only catch is you can't collect unemployment benefits while serving as a company director.

Milky Way said:Alright, an acquaintance told me that under the new LLC regulations, you have to have at least one employee on staff. What does that actually mean in practice? If I am the CEO, am I required to be an employee of my own company and pay payroll taxes, even if I already have a full-time job elsewhere where my taxes and benefits are being covered?

No. As long as your social security, Medicare, and income taxes are already being paid through another employer, you don't have to pay them again as the director.

If you aren't employed anywhere else—meaning no one is covering your taxes or benefits—then you have to pay them as an employee of your own firm.

cartmann said:If you aren't officially employed—meaning nobody is covering your Social Security, Medicare, or local taxes—then you have to shoulder those costs yourself as a self-employed business owner.

Even then, it isn't strictly required, but you certainly won't be eligible for the standard health coverage or benefits provided to regular employees.

I’m starting to think we need a permanent headline that reads: "LLCs don't actually require employees." This same debate keeps resurfacing every few months like clockwork. 😬