Friday, May 27, 2022

KNOW WHAT IS LLC??









  • https://www.incfile.com/
     
  • https://fitsmallbusiness.com/what-is-an-llc
  • Many business owners also enjoy the tax benefits of a limited liability company. LLCs are not taxed at the high 35% rate like C corporations (C-corps), which are legal entities for larger companies that are managed by a board of directors or considering being listed on the stock market. An LLC’s profit is taxed at the personal level, which includes a self-employment tax, federal tax, and state tax.
  • Additionally, you can elect to have your LLC taxed as an S corporation (S-corp) to take advantage of tax savings. Essentially, part of the profit can be paid as a dividend that won’t be taxed, which may result in thousands of dollars in savings.
  • To register your business as an LLC, you can use an online legal service, like IncFile, which costs $49 plus the state registration fee.
  • To register your business as an LLC, you can use an online legal service, like IncFile, which costs $49 plus the state registration fee. The online legal service takes care of paperwork and can rush the registration to get it approved within 10 days. Typically, it takes a month for the business registration paperwork to be approved by the state. The other way to register your business is to go directly to your state’s official business registration website and walk through the steps yourself.
  • Before legally establishing the LLC, there are a few requirements. Not all states have the same rules, but typically, you will need an original business name. You must also list a registered agent (business contact), file articles of organization (legal document establishing the business), and pay the fee.
  • The LLC is a great option for business owners who need flexibility in their business ownership structure. The LLC can be owned by a single member or it can be owned by multiple members. You can create an LLC if you’re not a citizen of the United States or are partnering with someone who is not a U.S. citizen.
  • Single-owner business: To start an LLC, you only need one member, which is the business owner.
  • Multi-owner business: If you’re starting a partnership, you can add several members to your limited liability company.
  • Foreign national business owner: Someone who is not a U.S. citizen can start an LLC. There are no citizenship or residency restrictions.
  • Business with passive owners: There can be several passive owners in an LLC. This is called a Manager-Managed LLC.
  • Anonymously owned business: This is a business for which the ownership details are not made public. An anonymously owned business is currently only available for businesses registered in New Mexico.
  • By law, LLCs must pay a 15.3% self-employment tax. The remaining profit is subject to federal and state tax. The remaining profit is paid to the business owner. Most limited liability companies choose to elect S-corp status to save thousands of dollars on their taxes. Electing S-corp status means that before taxes are applied, a business’ profit is split into an owner’s salary and a dividend. The owner’s salary must be a fair market rate for the industry
  • For example, let’s say a business has $80,000 in profit. You pay yourself $50,000 as a general manager. That leaves $30,000 ($80,000 – $50,000) as a tax-free dividend. Your $50,000 salary is taxed at the self-employment, federal, and state (if applicable) levels. Not paying taxes on the $30,000 would save $4,590 in taxes ($80,000 x 15.3% = $12,240; $30,000 x 15.3% = $7,650; $12,240 – $7,650 = $4,590)
  • Most LLCs must name a registered agent, which is the official contact for the business. This contact will receive all communication from the state regarding the LLC. It’s important to name someone responsible because if the business misses the yearly LLC re-filing with the state, it can incur a late fee of several hundred dollars.

    Additionally, the articles of organization is a document outlining the basic details about your business and is required when establishing an LLC. States vary with requirements, but most states require the articles of organization to include the business name, registered agent, address of main business location, duration of formation, contact information, and the purpose of the company.

  • FURTHER DETAILS  PLEASE REFER TO THE LINK MENTIONED ABOVE TO BE ON THE SAFE SIDE AND TO KNOW MORE IN A LUCID MANNER BEFORE TAKING ANY DECISION.

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