Starting an LLC: Where to begin?

Hey everyone,

I'm thinking about starting an LLC and have a few questions.
1. I'd be running things out of my apartment, which I'm currently renting. Does my landlord need to sign a separate lease agreement specifically with my LLC for a portion of the space? Does that mean my original lease automatically changes because the residential square footage decreases by, say, 100 square feet for the business? Or could I just set up a sublease through the LLC?

2. Right now, I have a full-time job. If I open an LLC where I'm the director, am I exempt from paying self-employment taxes on top of everything else? Like, would I just be covering my accountant and those U.S. Chamber of Commerce fees and stuff? Also, I'm assuming I can finally start invoicing all that side hustle work I've been doing through the company. How does that all get calculated on my tax return at the end of the year? Might be a dumb question, but I'm totally new to this.😁

3. Are there any tax breaks or deductions for continuing education, training, or getting certifications? Can I bill those to my LLC to save some cash, or should I wait until the business is actually up and running?
How does the tax situation work if I'm working with international clients who pay me via services like PayPal or Venmo?

Thanks a ton🙂

Wait—did someone say "piglet"? I think you might be looking for a different thread! kaže:
Hey everyone!

I'm thinking about starting an LLC—got a few questions!
I’d run the business right out of my own place—the one I’m currently renting. Does my landlord need to sign a separate lease agreement with my LLC just for that small office space? And would that automatically trigger an amendment to our main lease since the residential square footage would technically drop by, say, 10 square feet for the business? Or could I just set up a sublease through my LLC?

So, if I’m working full-time and decide to open my own LLC where I'm the boss—do I actually get out of paying those self-employment taxes? Like, am I just stuck with the accountant fees, the U.S. Chamber of Commerce dues, and whatever other random stuff pops up? Also, I’m assuming I can finally start invoicing all that side hustle work through the company properly—that works, right? And how does this all actually shake out on my tax return at the end of the year? Might be a rookie question—I'm still figuring this whole thing out!😁

Are there any tax breaks or perks for extra training, certifications, or picking up new skills? I'm wondering if I should run those expenses through my LLC to save some cash—or if it’s better to just wait until I actually start working for a company.
So, how do you handle taxes when you're working with overseas clients—say they pay you through things like PayPal or Venmo?

Thanks a bunch!🙂

Yeah, your landlord definitely has to rent you the space or at least give you the green light to sublet—it's just how it works.

Look, you can totally run things as a director—your employer picks up the payroll taxes, so that’s one less headache. You just cover your accountant and the U.S. Chamber of Commerce fees—though, honestly, those registration fees weren't even a thing back in 2015. Then you've got your annual corporate tax and that 21% income tax to deal with later on—plus, depending on what you're doing and where your office sits, you might get hit with local tourism levies or historical preservation fees. It adds up!
You don't deal with a tax return here—that's more for sole proprietors—you just look at your final balance sheet and pay 20% on whatever profit you pull out. If you actually want to distribute those profits to yourself, you’re looking at an extra 12% plus some local surcharges. 🙂

And just so you know—if you decide to pay yourself a salary from that during the year, the IRS is going to count it all as additional income.

You don't get any tuition assistance since you aren't officially on the payroll at your company—if you were, then you might actually have a shot at it! 🙂

When you're using services like PayPal or Venmo—and that card you’ve linked to pull your funds—it really needs to be tied directly to your business checking account. Also, when you're sending out invoices, just make sure to specify the payment method—like "PayPal"—so your accountant can easily track everything.

How does one actually pull cash out of an LLC, if that's even possible? Maybe through expense reimbursements or something... I guess it's hard to justify every single dollar using nothing but business receipts.

Walter Miller23 said:How does one actually pull cash out of an LLC, if that's even possible? Maybe through expense reimbursements or something... I guess it's hard to justify every single dollar using nothing but business receipts.

Every single cent has to be backed up by actual business expenses if you're running an LLC.

A few questions from my end:

1. If I set up an LLC operating out of my own home, am I allowed to rent that space to the business as an individual?
2. Would I be required to switch to commercial utility rates from Exelon in that scenario? That goes for other utilities too...
3. In your opinion, is there any actual value in getting a dedicated fax line? It used to be a staple for small businesses, but I can’t remember the last time I actually received a fax at work.
4. Is it legally feasible to be technically unemployed while serving as the director of my own LLC? This would help avoid paying myself a salary and running up unnecessary overhead until the company starts seeing decent revenue.

Thanks in advance for the insight!

Carol Price4 said:

Wait—did someone say "piglet"? I think you might be looking for a different thread! kaže:
Hey everyone!

I'm thinking about starting an LLC—got a few questions!
I’d run the business right out of my own place—the one I’m currently renting. Does my landlord need to sign a separate lease agreement with my LLC just for that small office space? And would that automatically trigger an amendment to our main lease since the residential square footage would technically drop by, say, 10 square feet for the business? Or could I just set up a sublease through my LLC?

So, if I’m working full-time and decide to open my own LLC where I'm the boss—do I actually get out of paying those self-employment taxes? Like, am I just stuck with the accountant fees, the U.S. Chamber of Commerce dues, and whatever other random stuff pops up? Also, I’m assuming I can finally start invoicing all that side hustle work through the company properly—that works, right? And how does this all actually shake out on my tax return at the end of the year? Might be a rookie question—I'm still figuring this whole thing out!😁

Are there any tax breaks or perks for extra training, certifications, or picking up new skills? I'm wondering if I should run those expenses through my LLC to save some cash—or if it’s better to just wait until I actually start working for a company.
So, how do you handle taxes when you're working with overseas clients—say they pay you through things like PayPal or Venmo?

Thanks a bunch!🙂

Yeah, your landlord definitely has to rent you the space or at least give you the green light to sublet—it's just how it works.

Look, you can totally run things as a director—your employer picks up the payroll taxes, so that’s one less headache. You just cover your accountant and the U.S. Chamber of Commerce fees—though, honestly, those registration fees weren't even a thing back in 2015. Then you've got your annual corporate tax and that 21% income tax to deal with later on—plus, depending on what you're doing and where your office sits, you might get hit with local tourism levies or historical preservation fees. It adds up!
You don't deal with a tax return here—that's more for sole proprietors—you just look at your final balance sheet and pay 20% on whatever profit you pull out. If you actually want to distribute those profits to yourself, you’re looking at an extra 12% plus some local surcharges. 🙂

And just so you know—if you decide to pay yourself a salary from that during the year, the IRS is going to count it all as additional income.

You don't get any tuition assistance since you aren't officially on the payroll at your company—if you were, then you might actually have a shot at it! 🙂

When you're using services like PayPal or Venmo—and that card you’ve linked to pull your funds—it really needs to be tied directly to your business checking account. Also, when you're sending out invoices, just make sure to specify the payment method—like "PayPal"—so your accountant can easily track everything.

I feel I must offer a few corrections here.

1. It is technically possible to operate without a formal agreement, though doing so is incredibly risky; if an inspector happens to drop by, they will certainly give you a hard time about it.

2. You still have to pay the U.S. Chamber of Commerce even if you are operating as an LLC. I know this from personal experience, as I run my own LLC and I pay those dues regularly$17 every single month.

restlesstiger102 said:I feel I must offer a few corrections here.

1. It is technically possible to operate without a formal agreement, though doing so is incredibly risky; if an inspector happens to drop by, they will certainly give you a hard time about it.

2. You still have to pay the U.S. Chamber of Commerce even if you are operating as an LLC. I know this from personal experience, as I run my own LLC and I pay those dues regularly$17 every single month.

1) To satisfy the IRS, you need a certified commercial lease agreement for your business headquarters—so, honestly, I have no idea how you thought you could pull that off without a formal contract?

2) I’m not really sure why you're paying the U.S. Chamber of Commerce, or how much your accountant actually knows about this stuff, but you should definitely check out Article 7 at this link:

Carol Price4, I actually had this exact conversation when I visited the IRS office. I explained to them that I don't run a brick-and-mortar storefront, but rather an online business, and since I live with my family, it wouldn't make any sense to lease a separate commercial space just to reside in it. The agent didn't push back at all; she just gave me an "okay" and left it at that. No one tried to force the issue. However, there is a significant difference between a casual inquiry and a formal audit. It’s entirely possible that during a routine check, no one would ask, but it’s also possible they could make a real issue out of it.

Regarding the U.S. Chamber of Commerce, I am planning to reach out to my accountant first thing tomorrow morning. To be honest, everything you mentioned about the monument rent and those other fees is exactly what my accountant told me herself. I’m going to forward the link you shared directly to her so she can review it. Regardless, thank you for sending that over. If it turns out I’ve been paying things I wasn't required to, I intend to get it sorted out so I'm not wasting money for no reason.😁

restlesstiger102 said:Carol Price4, I actually had this exact conversation when I visited the IRS office. I explained to them that I don't run a brick-and-mortar storefront, but rather an online business, and since I live with my family, it wouldn't make any sense to lease a separate commercial space just to reside in it. The agent didn't push back at all; she just gave me an "okay" and left it at that. No one tried to force the issue. However, there is a significant difference between a casual inquiry and a formal audit. It’s entirely possible that during a routine check, no one would ask, but it’s also possible they could make a real issue out of it.

Regarding the U.S. Chamber of Commerce, I am planning to reach out to my accountant first thing tomorrow morning. To be honest, everything you mentioned about the monument rent and those other fees is exactly what my accountant told me herself. I’m going to forward the link you shared directly to her so she can review it. Regardless, thank you for sending that over. If it turns out I’ve been paying things I wasn't required to, I intend to get it sorted out so I'm not wasting money for no reason.😁

Legally speaking, you're supposed to have a lease if you're running a business there, but hey—if the clerk let you slide without one, she probably just didn't want the headache of getting involved. 🤷

And definitely sort out that U.S. Chamber of Commerce thing; it's pretty silly to keep paying when you're exempt...😁

True, the law might state one thing on paper, but in actual practice, the reality on the ground is often quite different.
I’m actually going to touch base with my accountant tomorrow to double-check everything, so I'll have them give the U.S. Chamber of Commerce a call and verify the specifics... I'm certainly glad I came across this information here.😁

Hey, I could really use some advice here... if anyone knows the deal.
So, here’s my situation: I’ve got a steady full-time gig right now where they pay me on time and handle all my taxes and benefits, which is great. But, I’ve got this itch to pick up some freelance work on the side whenever I have the downtime.
Since the work involves photography, I can't just open a simple sole proprietorship because those are strictly regulated—you basically need specific trade certifications or licenses that I don't have. So, I’ve been looking into starting an LLC.

From what I’ve gathered, you can technically set up an LLC without having employees, but there's this catch where the business isn't supposed to show a profit unless there's actually someone on the payroll.
I also thought about asking my current boss to scale back my hours from a full 8-hour shift to maybe 4 or 6 hours, so I could use the leftover time to run my own thing, but honestly, I'm not really vibing with that option.

Then, this idea popped into my head: What if I set up an LLC in my own name but don't officially hire myself as an employee? Instead, every time a job comes up, I’d just sign an independent contractor agreement with my own company. Basically, I’d be signing as the owner of the LLC on one side, and as the service provider on the other. Is that even possible? And more importantly, is it actually legal?

I know it sounds kind of "stupid" since the tax hit on contractor agreements is pretty brutal, but I'm low-key terrified that I won't find any other way to do this legally.

The only other alternative I can think of is finding some country in the European Union that doesn't have these weird rules about companies needing employees to turn a profit, then opening a business over there while still working here in America. 😕

casualwolf22 said:Hey, I could really use some advice here... if anyone knows the deal.
So, here’s my situation: I’ve got a steady full-time gig right now where they pay me on time and handle all my taxes and benefits, which is great. But, I’ve got this itch to pick up some freelance work on the side whenever I have the downtime.
Since the work involves photography, I can't just open a simple sole proprietorship because those are strictly regulated—you basically need specific trade certifications or licenses that I don't have. So, I’ve been looking into starting an LLC.

From what I’ve gathered, you can technically set up an LLC without having employees, but there's this catch where the business isn't supposed to show a profit unless there's actually someone on the payroll.
I also thought about asking my current boss to scale back my hours from a full 8-hour shift to maybe 4 or 6 hours, so I could use the leftover time to run my own thing, but honestly, I'm not really vibing with that option.

Then, this idea popped into my head: What if I set up an LLC in my own name but don't officially hire myself as an employee? Instead, every time a job comes up, I’d just sign an independent contractor agreement with my own company. Basically, I’d be signing as the owner of the LLC on one side, and as the service provider on the other. Is that even possible? And more importantly, is it actually legal?

I know it sounds kind of "stupid" since the tax hit on contractor agreements is pretty brutal, but I'm low-key terrified that I won't find any other way to do this legally.

The only other alternative I can think of is finding some country in the European Union that doesn't have these weird rules about companies needing employees to turn a profit, then opening a business over there while still working here in America. 😕

As far as I know, a company can pull in millions without having a single employee. That's what the lawyer told us when we were setting things up.

casualwolf22 said:Hey, I could really use some advice here... if anyone knows the deal.
So, here’s my situation: I’ve got a steady full-time gig right now where they pay me on time and handle all my taxes and benefits, which is great. But, I’ve got this itch to pick up some freelance work on the side whenever I have the downtime.
Since the work involves photography, I can't just open a simple sole proprietorship because those are strictly regulated—you basically need specific trade certifications or licenses that I don't have. So, I’ve been looking into starting an LLC.

From what I’ve gathered, you can technically set up an LLC without having employees, but there's this catch where the business isn't supposed to show a profit unless there's actually someone on the payroll.
I also thought about asking my current boss to scale back my hours from a full 8-hour shift to maybe 4 or 6 hours, so I could use the leftover time to run my own thing, but honestly, I'm not really vibing with that option.

Then, this idea popped into my head: What if I set up an LLC in my own name but don't officially hire myself as an employee? Instead, every time a job comes up, I’d just sign an independent contractor agreement with my own company. Basically, I’d be signing as the owner of the LLC on one side, and as the service provider on the other. Is that even possible? And more importantly, is it actually legal?

I know it sounds kind of "stupid" since the tax hit on contractor agreements is pretty brutal, but I'm low-key terrified that I won't find any other way to do this legally.

The only other alternative I can think of is finding some country in the European Union that doesn't have these weird rules about companies needing employees to turn a profit, then opening a business over there while still working here in America. 😕

That part in bold is completely wrong, but try an S-Corp instead—it's cheaper.

Thanks for the input!
If I don't have any employees on payroll, do I actually need to sign a contract with myself when I head out to film, or can I just wing it without all that paperwork?

You can manage without that too

Forgive me if I come crashing in here like a skydiver with just one quick question. Our attorney filed all the paperwork at the Delaware Court of Chancery last Friday to get our branch officially registered. In your experience, how long does it typically take to receive the final decision regarding the registration?

I need some guidance here.

Here’s the situation. I’m a foreign national looking to incorporate a business entity right here in the States—purely for the purpose of acquiring real estate. In this scenario, the company would act as the legal owner of the property. Does the process for setting up a corporation differ for foreigners versus American citizens, and what kind of timeline am I looking at? Furthermore, is there a requirement for the company to be actively operating?

Hey everyone,

Mods, if this is in the wrong spot, feel free to move it or merge it with whatever thread makes sense. Just let me know...

So, here's the deal. A couple of my buddies and I are looking to launch our own marketing agency. We've all got degrees and we think we've actually got a killer idea on our hands, but there's one tiny problem: zero startup capital.

Is it even possible to get something off the ground with basically nothing? Like, say, a few thousand bucks, a ton of caffeine, and pure hustle? What’s the easiest way to make that happen?

Could we just register the business at someone's house and start grinding from there...?

If anyone has any advice, tips, or even just a helpful link, I’d seriously appreciate it. 🙂

I have a question regarding service calls—if I’m performing onsite maintenance as an employee of my own LLC, am I strictly required to carry a mobile point-of-sale device for immediate invoicing? Or would it be acceptable to simply swing back to the office and print the receipt from my computer?
Since this would essentially be a side gig for me—definitely not more than four times a month to start—I’d rather not sink capital into mobile fiscal hardware just yet. It feels silly to turn away potential business over a technicality.

Also, if my LLC is primarily registered for retail, how much red tape am I looking at if I want to perform another service we're already registered for—say, computer repair? Is there a mountain of paperwork involved when adding a secondary service line, or does it go smoothly as long as the activity is listed in our corporate filings?

I’m also wondering if there’s some kind of government agency or service where you can just reach out—maybe via a phone call or an email—and ask, "Hey, if I open this specific type of business, what am I looking at?"
Could someone please point me toward all the relevant federal laws and regulations governing this field? I’d rather not spend my time hunting through legal databases myself, only to get hit with a massive fine because I missed a single technicality...

To be specific: 1) I’m looking to start a web shop, but honestly, I’d just want to sell through eBay to start since I don't really need anything else right away. Does that actually fall under the legal definition of an e-commerce business, or am I required to have a dedicated, standalone website with its own domain and URL to qualify?

2) I don't plan on having a brick-and-mortar storefront. My LLC will just be registered to my home address, which will serve as my office space and where I'll keep my inventory. I'm a bit fuzzy on how the zoning works for a home office. My primary business would likely be retail, but I won't have a physical shop where customers walk in (I could set one up, but god knows what kind of building codes and permits I'd have to jump through). Instead, I'll just handle sales through listings, shipping via USPS, and so on. Within that same home office setup, would I be allowed to perform computer repair services? Essentially, people could ship items to me or drop them off, I'd fix them, and then send them back.

3) If I'm only selling via eBay, what are the rules regarding my storage area for inventory? I'll be dealing with computer replacement parts—mostly electronics—so it won't take up much room. Are there any specific storage facility requirements for this kind of retail operation?

4) Regarding sales tax and payment processing—from what I’ve gathered so far, if a customer pays via COD (Cash on Delivery) or via an invoice, it might not require immediate point-of-sale reporting. But for upfront payments made against a quote, can I just use a desktop accounting system at my office to process the transaction and then mail the receipt along with the product?

5) Now, what if the customer lives in my same city? It sounds simple, but it's actually a headache. I won't be shipping it through the mail. How should they pay me? I could ask them to pay via an emailed invoice, but that feels a little clunky for the customer. Is there a more seamless way to handle that?

6) Also, the whole concept of primary versus secondary business activities is a bit confusing to me. So, my primary business is retail, and that's what I'll be doing (what exactly are the criteria used to define a "primary" activity?). And what happens if a customer wants me to actually install the part I’m selling? If I register "repair services" as a secondary activity, what are the requirements for that? Would I be forced to maintain specific business hours, given that service work is quite time-intensive?
And if I go to the customer's house to install the part—would I be required to use a mobile POS system? I know those mobile solutions can get pretty pricey, so I'm hoping there's another way.
I assume an LLC can run several different business activities simultaneously as long as they are registered and all compliance standards are met. Also, can you be registered for a certain type of business before you actually meet all the requirements to perform it? Like, can I list it now and then fulfill the requirements later when I actually decide to start doing it? How does that workflow function?

7) Additionally, would it be feasible—and cost-effective in terms of complexity and fees—to act as a "buying agent" or middleman? For example, if I don't have a specific part in stock and it's a rare item that isn't frequently requested, could I simply facilitate the purchase for the client instead of holding inventory? How would that be structured legally?

8) To save everyone some time and avoid cluttering the general sales tax thread, what would be the best accounting software for this setup? I'll need something that handles inventory management. As for the transactions, I expect a relatively low volume initially—maybe a hundred invoices a month—and most of them will likely be handled via COD or B2B bank transfers rather than direct retail sales.
One more thing: what happens when an individual makes a payment based on a quote sent to their personal account? Does that still need to be processed through my sales tax system? And if a corporation pays from their business account, is that treated differently?

I would truly appreciate any answers or guidance you could provide on these matters.

PS:

Raymond Martinez10 said:That part in bold is completely wrong, but try an S-Corp instead—it's cheaper.

Wouldn't setting up an LLC actually be the more cost-effective and straightforward route in the long run? That's what I've been seeing on several business sites lately.