<story><title>Ask HN: Starting Your Own LLC?</title><text>I want to start my firm in the USA to channelize my  creative endeavors. What are the nuts and bolts of starting your own firm? I can register an LLC online, but what else should I know? e.g Filing taxes, choosing between different corporations etc.
What did you wish you knew , when you started yours? What are some good resources ?</text></story><parent_chain><item><author>busterarm</author><text>Being a single-person LLC usually doesn&amp;#x27;t give you any of the legal advantages of having an LLC in case you get sued.</text></item><item><author>gshdg</author><text>Note that a single-person LLC can file taxes as a pass-thru entity, which is essentially the same as a sole proprietorship. You do still need to separate your finances&amp;#x2F;accounts&amp;#x2F;etc tho.</text></item><item><author>mdorazio</author><text>1) Doing taxes correctly as anything other than a sole proprietorship is a huge pain in the ass, especially if you&amp;#x27;re selling things across state borders, and doubly so if you&amp;#x27;re in California.  I recommend finding a tax professional to handle that for you (the time it takes to do it yourself is generally not worth it).  Also don&amp;#x27;t forget that if you&amp;#x27;re actually making money you&amp;#x27;ll need to pay estimated taxes quarterly.&lt;p&gt;2) Either learn basic accounting (if you don&amp;#x27;t already) and keep excellent records of all revenue and expenses business-related (ideally categorized into standard business categories) or find a CPA to keep your records straight monthly.  A huge number of people get burned simply because they didn&amp;#x27;t keep proper records and then ran into tax or regulatory trouble later.&lt;p&gt;3) Definitely keep your business finances as separate from your personal funds as possible.  Different checking account, different credit card, etc.&lt;p&gt;4) Think really hard before you hire anyone for anything, and if you do, make sure you&amp;#x27;re either doing 1099 correctly or get a professional to help with W2 stuff.  Again, this is something that often comes back to bite people.&lt;p&gt;And lastly, remember that most businesses fail and that failing at business is not something to be ashamed of.  If it&amp;#x27;s not working out, don&amp;#x27;t make yourself miserable and mortgage your future to try and save it indefinitely - walk away and try again with the lessons you learned.</text></item></parent_chain><comment><author>ahnick</author><text>I talked to a lawyer about this and the feedback I received was while technically they might be able to sue to try and receive compensation even from your personal assets if you are a single-member LLC as long as you can show you were acting in good faith and as an agent of the company (i.e. you didn&amp;#x27;t personally guarantee the work and sign your name instead of the company&amp;#x27;s and you maintain distinct records and finances for the business), then it is unlikely to get approved in a court of law.&lt;p&gt;So an example here might be that you were working for a client and work wasn&amp;#x27;t fully completed on time.  You made a good faith effort to get the work done, so while the company you were working for might be entitled to compensation from your LLC they can&amp;#x27;t come after your house.&lt;p&gt;Finally, let me caveat all this by saying that the standards for &amp;quot;piercing the corporate veil&amp;quot; vary by state and as always you should consult with a lawyer before making a final determination.  Also, another work around is to form a multi-member LLC and hold formal annual meetings.  This is normally enough for most states to consider the LLC as a separate distinct entity and prevent piercing of the corporate veil.</text></comment>
<story><title>Ask HN: Starting Your Own LLC?</title><text>I want to start my firm in the USA to channelize my  creative endeavors. What are the nuts and bolts of starting your own firm? I can register an LLC online, but what else should I know? e.g Filing taxes, choosing between different corporations etc.
What did you wish you knew , when you started yours? What are some good resources ?</text></story><parent_chain><item><author>busterarm</author><text>Being a single-person LLC usually doesn&amp;#x27;t give you any of the legal advantages of having an LLC in case you get sued.</text></item><item><author>gshdg</author><text>Note that a single-person LLC can file taxes as a pass-thru entity, which is essentially the same as a sole proprietorship. You do still need to separate your finances&amp;#x2F;accounts&amp;#x2F;etc tho.</text></item><item><author>mdorazio</author><text>1) Doing taxes correctly as anything other than a sole proprietorship is a huge pain in the ass, especially if you&amp;#x27;re selling things across state borders, and doubly so if you&amp;#x27;re in California.  I recommend finding a tax professional to handle that for you (the time it takes to do it yourself is generally not worth it).  Also don&amp;#x27;t forget that if you&amp;#x27;re actually making money you&amp;#x27;ll need to pay estimated taxes quarterly.&lt;p&gt;2) Either learn basic accounting (if you don&amp;#x27;t already) and keep excellent records of all revenue and expenses business-related (ideally categorized into standard business categories) or find a CPA to keep your records straight monthly.  A huge number of people get burned simply because they didn&amp;#x27;t keep proper records and then ran into tax or regulatory trouble later.&lt;p&gt;3) Definitely keep your business finances as separate from your personal funds as possible.  Different checking account, different credit card, etc.&lt;p&gt;4) Think really hard before you hire anyone for anything, and if you do, make sure you&amp;#x27;re either doing 1099 correctly or get a professional to help with W2 stuff.  Again, this is something that often comes back to bite people.&lt;p&gt;And lastly, remember that most businesses fail and that failing at business is not something to be ashamed of.  If it&amp;#x27;s not working out, don&amp;#x27;t make yourself miserable and mortgage your future to try and save it indefinitely - walk away and try again with the lessons you learned.</text></item></parent_chain><comment><author>ksdale</author><text>Being a single person LLC absolutely does gives you the legal advantages of an LLC, provided you maintain separation of personal and business, eg keeping business bank accounts and routing all income and expenses through them, keeping proper accounting books, signing contracts as the LLC and not as yourself, holding company meetings w&amp;#x2F; minutes, etc.&lt;p&gt;In practice this protection isn’t worth as much as it is for larger businesses because, for example, any bank lending to a new single person LLC will require a personal guarantee anyway, and most single person LLC don’t have a lot of situations where they might incur a life destroying liability, like an accident in a warehouse or something, but that protection still definitely exists for single person LLCs.</text></comment>