I am thinking about setting up an LLC before we by the RV and the Toad. Additionally, we are thinking about 'lines of business' to generate income: working on golf courses, janitor work, camphosts, teaching business/program management at a junior college for a semester.
Have any of you set that up? Do you need to have a profitable business 3 of 5 years?
rwarner11 wrote: I am thinking about setting up an LLC before we by the RV and the Toad. Additionally, we are thinking about 'lines of business' to generate income: working on golf courses, janitor work, camphosts, teaching business/program management at a junior college for a semester.
Have any of you set that up? Do you need to have a profitable business 3 of 5 years?
Any advice?
Thanks
Randy and Pam
I was thinking about doing something that that too. If the business had work elsewhere, the miles could then be deducted at the federal rate.
I (2-10-05) bought a 2002 F350 CC SWD PSD and a new 2003 Citation 10'8. Rancho 9000X & Toyo M55's.I have been a tent camper all my life. I wanted more comfort while doing my Willamette Backcountry Ski Patrol & Crater Lake Ski Patrol duties.11
Relatively few companies will hire a contractor for the jobs you describe. They can't hire you as a contractor and other people as employees, if you're all doing the same work in basically the same manner. And for various IRS-related reasons, making everyone contractors is just not possible in most businesses (otherwise, every employer would do it.) If they are already contracting out these services, they would probably have their existing contractor add another worker to cover an increased workload, rather than have to deal with an entirely different company (yours.)
As an LLC, you will be responsible for securing any state/local business licenses and business insurance where they may be required. For example, very few businesses will hire you as a contractor to operate equipment if you don't have insurance (both liability and some type of injury or workers comp coverage.) When they hire you as an employee, they provide this insurance for you, but as a contractor you would need to provide your own.
In about 90% of cases, teaching business (or most non-vocational fields) as an adjunct at a 2yr college requires a graduate degree with at least 18hrs in subject-related graduate credits. If you meet that requirement you may find some opportunities, but probably not on a Corp to Corp basis.
To deduct business expenses, you have to show an effort to make a profit. If you fail to show a profit eventually, the odds are somewhat greater that your ductions may be (retroactively) disallowed. But many business fail despite sincere efforts, so it really comes down to demonstrating that you made a serious effort to make a profit, and weren't simply trying to deduct hobby expenses.
You can deduct miles, but only if you have a permanent location to which you return. I wouldn't try to get by with just a P.O. box without some input from an expert.
Having operated an LLC for some time now, my inclination is that for what you describe, it's just not worth the trouble.
Not that this is work on the line that you mentioned but you could get an EIN number to do merchandising/mystery shopping and then your mileage and other work related expenses would be deductible. I have been doing this for 7 years and it can pay fairly well if you learn how to group your work. If you are interested you can go to Volition.com which is a board for those of us who do this crazy work....
We only conserve what we love,
We only love what we understand,
We only understand what we know,
We only know what we are taught.
-- Baba Dioum
Business formation and entity choices are like a bottle and it's contents--they need to be matched, or it may spoil or go sour.
Usually the business (the contents) will indicate the type of entity (bottle) you should form. Seldom do you form the entity (LLC) and then decide what business to enter.
Sometimes a corporation is the answer--one way to be taxed $7,500 (15%) on the first $50k of taxable income. Your individual rate could be 28% or more.
Sometimes a sole proprietor is the answer--one way to limit financial exposure after the business owner dies is probate. Customers & creditors have only 6 months to submit claims after the owner's death. Let the surviving spouse and heirs keep more $$$.
Sometimes a LLC is the answer--one way to control 100% of the assets and not be the 100% owner. Pass the business to the kids--but you are in charge.
Hopefully you now have more questions than when you started.
Tim & Sue
Gerry (GSD) & Jammer (Sheltie)
2005 F150 4x4 Lariat 5.4L 3.73 Please buy a Hybrid...I need your gas for my 37 gallon tank!
2000 Nash 19B...comfortably pimped with a real Queen Size Bed Red Wine anyone?
There are very few things that can be done to make RV travel a tax deductible item. In fact, business travel is one of the most closely watched items by the IRS and is a very common trigger of audits. I highly recommend that you read the IRS publication 463 very carefully.
There is no case where a fulltimer can legally deduct travel expenses because the travel must be from your home and our RVs are our homes.
Kirk wrote: There is no case where a fulltimer can legally deduct travel expenses because the travel must be from your home and our RVs are our homes.
Just wondering if you are an accountant? Any travel in your toad to a place(s) of work is legally deductible as it is your home as you say. I deduct all expenses to and from my stick house to my place(s) of work legally. I would imagine the same would be true if you are traveling to a new location in your rig for the purpose of work.
We have a legitimate business purpose for our Rv (in fact it's the only reason we are buying one). But, I'm wondering, and would like a second opinion as to where would be the best placed to set up the llc. Our primary business is incorporated in Michigan. This subsidiary business will be virtual and we'll be traveling a great deal to our clients' offices. Nevada and Delaware has it's benefits for corporations. I also believe that Nevada does not charge sales tax??? can anyone confirm this?
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