How Many "side" Car Detailers...

[alko]

...have their LLC's? I was talking with a co-worker about my side car detailing business, which is limited to the weekends. He asked me if I wanted to one day turn it into a real business and threw out suggestions like an LLC. We discussed the taxing and the tax breaks briefly. I played with this idea when I started thinking about detailing cars for money.

So...back to the original question...how many people that detail cars on the weekend for money, have an LLC? What are some of the major pro's and con's to having an LLC?

My thing is this...if I start an LLC...say I don't make much money, would it be worth it?

[Flash Gordon]

No, but I should. Intrested to see the responses

[ScubaCougr]

No, but I should. Intrested to see the responses

Not yet. I need to see if I can sustain any business over Oregon's perpetual rainy season (I'm mobile).

Benefits:
You keep code enforcement and tax dept off your back
You may get a little additional business from people who view license = legitimacy.

Drawbacks:
I'd be paying about 17% in sales taxes and business taxes to the state.
I'd have to file quarterly tax returns, even as a sole proprietor.

Taxes:
The IRS and federal taxes: It's a hobby for 3 years because deductions are unlimited. If it's a business (even as a sole proprietor) I can only count losses up to my pathetic income. (as I understand, please consult qualified advice).

[Bunky]

Taxes:
The IRS and federal taxes: It's a hobby for 3 years because deductions are unlimited. If it's a business (even as a sole proprietor) I can only count losses up to my pathetic income. (as I understand, please consult qualified advice).

The loss limitations are because some people decided to find ways to always lose money to avoid taxes.

[Twister]

I was thinking about this the other day. I want to do this on the side to make a little extra coin and I enjoy it. I haven't looked into all the requirements of an LLC yet but I'm going to start researching some. I want to do things right and avoid any problems. Someone suggested that I start with a DBA and go from their.

Say you don't work for a while and so there is no income. Will the tax man pull out the microscope to check on you?

[DLB]

A lawyer friend of mine advised me to just get some good insurance.
He said the LLC process would be simple for me, but probably unnecessary given the volume I do.

However, this was based on my scenario, yours may be different.

DLB

[alko]

I think it all depends I guess...

The few aspects that I'm interested in...one I came up with, I think, is a pretty catchy name. I asked the question: Will the name of my company be protected-so that no one steals it. And the other aspect, of course, is writing supplies and other various items off on my taxes. I don't expect to pull in a high volume, so would being taxed with the very few cars I would do be worth it....

I guess this is what I'll be doing for the weekend...research.

[Rav777]

As a student I have a sole proprietorship. I feel it is more proffesional to have an established name in my area. There are a lot of hack detailers around here that have no name and no insurance.

I would try it out at first and see how it goes for you. The only reason I got licensed was because I got a big contract in a golf course/spa resort.

[WindyCity]

A LLC is simply how you structure your business, there is a sole proprietorship, a LLC, and a corporation (there are numerous ways to set up a corporation).

From my understanding the easiest and best for taxes is setting up a sole proprietorship, this is how i have my business. It is also the cheapest and doesn't have annual cost to keep going. Downside is liability, someone can sue you personally. I don't feel like this is all that scary folks! All we are doing is detailing their car and honestly what is the worst that can happen? you scratch or damage their car? No problem, my low cost insurance will cover that. even if I burn their car to the ground, my 150,000 policy will easily cover that plus replace the burn mark in the driveway. My other business is a construction company, now we are talking about liability, we work on scaffolding, and someone could fall and get killed, so I have this set up as a corporation.

I don't know about LLC costs but a corporation cost several hundred a year, plus you have to do quarterly taxes.

For a mobile detail operation just looking to make a little money I would go with a sole proprietorship, its the cheapest, easiest, and most effortless way to set up your business.

[ScubaCougr]

honestly what is the worst that can happen? ... even if I burn their car to the ground, my 150,000 policy will easily cover that plus replace the burn mark in the driveway.

That is fantastic. Bravo! :props: :iagree:

[timaishu]

What is an LLC? I feel left out. :dunno:

[Bunky]

What is an LLC? I feel left out. :dunno:

IRS: A Limited Liability Company (LLC) is a business structure allowed by state statute. LLCs are popular because, similar to a corporation, owners have limited personal liability for the debts and actions of the LLC. Other features of LLCs are more like a partnership, providing management flexibility and the benefit of pass-through taxation.

[WindyCity]

That is fantastic. Bravo! :props: :iagree:

OL thanks! I feel it is true though I have seen people say "you can never bee too careful". I really don't feel it is worth the cost of incorporating and paying for a huge insurance policy if you are detailing part time. Insurance salesman will tell you to be safe and sell you a million dollar policy, but why would we need that much coverage if we are only detailing a car?
__________________

[WindyCity]

...have their LLC's? I was talking with a co-worker about my side car detailing business, which is limited to the weekends. He asked me if I wanted to one day turn it into a real business and threw out suggestions like an LLC. We discussed the taxing and the tax breaks briefly. I played with this idea when I started thinking about detailing cars for money.

So...back to the original question...how many people that detail cars on the weekend for money, have an LLC? What are some of the major pro's and con's to having an LLC?

My thing is this...if I start an LLC...say I don't make much money, would it be worth it?

Honestly the people on this forum are a great resource, that being said pay to speak to a business attorney, or at least a CPA for professional advice how to structure your business. They know all the liabilities with the way you structure your business, all of the tax advantages, state taxes....ETC. A couple of hundred dollars now for professional advice now could save you a lot more later.

[alko]

A LLC is simply how you structure your business, there is a sole proprietorship, a LLC, and a corporation (there are numerous ways to set up a corporation).

From my understanding the easiest and best for taxes is setting up a sole proprietorship, this is how i have my business. It is also the cheapest and doesn't have annual cost to keep going. Downside is liability, someone can sue you personally. I don't feel like this is all that scary folks! All we are doing is detailing their car and honestly what is the worst that can happen? you scratch or damage their car? No problem, my low cost insurance will cover that. even if I burn their car to the ground, my 150,000 policy will easily cover that plus replace the burn mark in the driveway. My other business is a construction company, now we are talking about liability, we work on scaffolding, and someone could fall and get killed, so I have this set up as a corporation.

I don't know about LLC costs but a corporation cost several hundred a year, plus you have to do quarterly taxes.

For a mobile detail operation just looking to make a little money I would go with a sole proprietorship, its the cheapest, easiest, and most effortless way to set up your business.

I've never heard of a sole proprietorship before. I am going to take the weekend to do some research on both. But from what you have suggested, the proprietorship sounds like the way to go. I'll talk it over with pops, as well, because he owns a business...maybe he can put me in touch with their lawyer and CPA. Thanks for the info...I appreciate it.