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Help with starting a LLC

Discussion in 'Business Fundamentals' started by mxrdrvr3, Feb 6, 2002.

  1. mxrdrvr3

    mxrdrvr3 Junior Member
    Messages: 16

    :D First off let me introduce myself to you all. I am Jason Smiley.

    I have been reading this site for three days now(wow)....lol,
    and what a great deal of info it has been to me. I have been plowing for a company here in the Metro Detroit are for two years now and feel that I am very underpayed as a driver for the company only making twenty dollars per hour with no time and a half,benifits ect. often putting in 60-80hrs weekly during the snow season for this guy. Plowing is only to offset my other seasonal work (as many of yourselves I think that do landscaping work)as a cement truck driver.

    Thus I have decided to start my own company. I have read so much great information at this site(thanks to your great generosity), and I now know that I want to structure as an LLC.
    Mainly for the legal aspects in case of the unfortunate I would rather be seperated from the bussiness(instead of a "DBA").

    I know that this will be much more difficult than structuring a DBA but I feel its best me. I have already sent into the state for my name, so what do i do now besides getting my "EIN" with the IRS do I have to do the same with the state? Also what else do I need to do besides getting insurance.(and clientel)

    Keeping in mind that I do not have the money for a Lawyer or a CPA at this time.(4kids....lol)

    As many of you are far more experianced than myself at the bussines aspect of snow plowing maybe you can tell me if my small plan will work (just enough to keep me in biz and turn a small profit with maybe some growth later on down the road if I so choose this is right for me)of sticking to just residential as I do not have a truck or the money for one right now, however I do have 2 four wheelers with plows and 2 snow blowers that in my opinion could be very profitable sticking obviously to residential work, also probobly less chance for damage to my customers due to smaller equipment that is easier to manuver around in city sized residential driveways.

    Let me know what you think, keep in mind that I have a strong chin and want to hear all the good with the bad:D
  2. John Allin

    John Allin PlowSite.com Addict
    Messages: 1,327

    Many of us have started out on a shoestring budget. It can be done. I started out that way.

    Setting up an LLC can be done without a lawyer. Search the web and you'll get the information you need. I cannot help you with the LLC as I'm not certain how to do it myself.

    Welcome to the biz, and best of luck to you....
  3. Lawn Lad

    Lawn Lad Senior Member
    Messages: 407

    Good luck with your start up. You can do it with a shovel if you have to and you have the determination.

    I started with 2 snow blowers in the back of a 2 wheel drive pick up... advertised the service to those customers that couldn't get a plow truck in their drive because it was so tight. We got too many customers the first year... 40 plus. Boy, those were the days. From the money we made on this we bought our first computer and paid off the equipment.

    Try the following websites for your LLC question.:


  4. mxrdrvr3

    mxrdrvr3 Junior Member
    Messages: 16

    :D Thanks John and Lawn lad appreciate the tips, but I was hoping to get a little more feedback. ;) Does anyone else have any comments they would like to share? I see that my thread has been visited by many people, hopefully they will return and post a reply as well.

    Once again thanks for your help, it's greatly appreciated and keep the good work guys. this has to be one of the most informative sites i have ever visited:D
  5. Mick

    Mick PlowSite.com Veteran
    from Maine
    Messages: 5,546

    mxrdrvr3 - what you're asking for is legal and business advise. These would best be answered by people in those specialties and in your area - namely accountant/lawyer and business leaders (try the SBA and SCORE). The reason there are a lot of hits and few responses is that the people on this site are very good snow removal/plow operators, but not especially knowledgeable of the law and business practices. (Not to detract from John Allin, John Parker and others). To analyze your business, I would suggest first developing a detailed Business Plan (available from the SBA site) and consult with a local member of SCORE. They could also give you good advise (and free) on setting up your business.
  6. Lawn Lad

    Lawn Lad Senior Member
    Messages: 407

    Mick is right here... it's really a question for you and your accountant to figure out based on your individual circumstances.

    My understanding is a LLC pays it's taxes as if you were a sole proprietorship. I don't know enough here to answer your questions. It simply makes me want to ask more questions.

    Is the profit that is passed onto your personal income subject to self employment tax?

    Is there no distinction between profit and salary in a LLC for the owner?

    How will this effect other areas of your life as you look for loans, financial aid, etc since your income in theory may be over stated?

    Other than legal protection, what are the advantages of being a LLC over a sole proprietorship?

    Are there differences between an LLC and S Corp other than taxation? If so, what are they?

    When does it make sense to be an LLC over a S Corp? What are the relative costs?

    Good luck mxrdrvr3 with your search for what's best. I'm sure you could ad another 20 questions to the ones above.
  7. Lawn Lad

    Lawn Lad Senior Member
    Messages: 407

  8. mxrdrvr3

    mxrdrvr3 Junior Member
    Messages: 16

    :D Ok guys thanks for the info and what may not seem like much to you, but that ingo was gr8;) and Lawnlad wow what a gr8 informative site thanks.

    If I can help any of you in anyway just ask me i will be glad to try and assist and will post on the llc as i learn them.

    btw I have a good knowledge of concrete so if u have ? just ask(but I dont suppose many you work with concrete). but its there if u ever have the need
  9. Heavenly Green

    Heavenly Green Junior Member
    Messages: 8

    I too Am looking into LLC for my company entity as Ive
    been A Sole Proprieter since 98 now that Ive started to gain some
    personal assets and looking to hire two helper this spring I want
    to be covered for any mishaps they could possible cause. My cpa
    that I met with yesterday is trying to push me in to A S Corp. but
    He also says he strongly recomends S. Corp. when your sales
    reach 100,000.00 a yr. And says S. Corp. will cost me 1500. to 2000. a yr with quarterly corprate tax returns So since my sales
    have only reached about 50,000. last year he suggested going
    LLC for now and later going S. Corp. So I can still File taxes as
    A Sole Proprieter once a yr.
    I Found Some good web sites for ya to check out.
    1. michigan.gov
    2. mycorporation.com

    My corporation.com is a cheap alternative to A CPA
    and everything you need to set-up LLC or S.Corp. is right there.

    This is my first winter doing snow(LOL) removal. no 60-80hr. weeks this year myfriend and its KILLING ME!!!!
    I took on 20 residential lawn customers and those contracts
    were to cover my equipment Ive purchased plow& snow blower.
    and I sub contract for a larger company for $65.00 per hr. and he
    has my truck booked for 5 plaza shopping centers this money was
    supose to cover some over head and put money in my pocket.
    Well Ive only pushed 2 times for him and 4times on mine which
    dosent put anything more into my pocket. So basicaly Im having
    some second thoughts about the snow bizz.

    Well I see were not to far from each other if I can be of any
    assistance give me a call 248 345-0792

    Steve@S&S Heavenly Green Lawns:cool: :cool: :cool: :cool:
  10. mxrdrvr3

    mxrdrvr3 Junior Member
    Messages: 16

    Thanks Steve,

    Those links were great! sorry I am so late in getting back to the reply on that I have been very busy but no with the sno biz....lol and FYI those long hours were last year when we had all that big snow day after day.

    Also I did go with a LLC and I filed all the paper work myself and did talk some with a cpa and he said it was best for my situation to elect to be taxed as a corp. becasue the businness(spelling?) will earn less than $50,000 per year as I am only doing this part time so any money that i keep in the biz will be taxed at the corp. rate which alot less than my personal rate.

    This worked great for me but my situation is more likely very different than yours and I am sure your biz will gross more than 50,000 (hope so for your sake):) if your hiring people. but look into the rates are in the nolo.com page you sent me.

    As for calling you, I will do that if nothing else I would like to make some friends here in the state as well as other peers in the biz. thanks again for all the help and extending your friendship to me. I am in center line near 696 and m-53(vandyke)

  11. mxrdrvr3

    mxrdrvr3 Junior Member
    Messages: 16

    sorry that nolo.com site lawnlad sent me check it out steve.

    Hey lawnlad it was very informative ty so very much, you guys are gr8 hope I can help you all one day and If its not you I can help, well I will sure pass the helping tradition on by helping all that can in any way I can!!!!!!!!!!!!!!!!!!!!:D :D