What is an LLC?

Before you set up an LLC, you first must know what exactly is it? LLC is an acronym for limited liability company. It is a type of business that differentiates the person and the company. This distinction protects personal liability to business owners. A hybrid type since it blends flexibility in structure and taxation that a sole proprietorship offers and the asset and liability protection offered by corporations.

With regards to sole proprietorships and. LLCs’ sole proprietorships offer the benefit of less tax-related filing than other business structures. Owners can pass-through business taxes in their tax return and the income is taxed only once. The drawback of sole proprietorships is that because the owner and the business are considered legally the same entity, the owners are 100 completely accountable for any debts and lawsuits that the business incurs and could put personal assets in danger. Establishing an LLC creates a legal separation between business and owner similar to a corporation–offering business owners a layer of personal asset protection.

  • Sole Proprietorship or Single Member LLC: Single-member LLCs, as well as sole proprietorships, are owned by one person. Single-member LLCs can employ employees however sole proprietors cannot. Owners can get around taxes bypassing company taxes on their tax returns. Sole proprietorships do not offer personal liability protection.
  • General Partnership General Partnership is an informal business arrangement that allows two or more persons can operate and manage the LLC equally. This means that they equally share the earnings and expenses. Every partner is legally the same company and therefore there is no personal liability protection for partners in general partnerships. However, partners can transfer business transactions on their tax returns.
  • Family Limited Partnerships: Family-owned partnerships, also called FLPs are established by members of the family who pool their resources to start and run the business. FLPs generally have two types of owners: general members and limited partnerships. General partners are accountable for operations, whereas limited partners don’t bear any management responsibilities, however, they can invest in the business to earn an income. They are a popular option for families that want to transfer wealth from generation to generation.
  • Series LLC Series LLC: A series LLC is a form of business structure that allows the owner to divide assets and business operations into various subsets, referred to as series. A series LLC lets each subset operate like a normal LLC as well as shielding each series from liability that the other one could be liable for. Some states do not permit series LLCs, so be sure to inquire with your state legislature.
  • L3C Company L3C Company: L3C Company: L3C (also known as a low-profit, limited liability company is a hybrid company that blends components of both LLC and a non-profit business. While L3Cs are permitted to make a profit, this money is to be used to support the cause of charity. The law is not universally recognized by all states. business model.
  • Manager-Managed LLC or Member-Managed LLC: Manager-managed and member-managed LLCs are, without a doubt, referring to the way an LLC is managed. An LLC managed by members is one in which all owners, also known as members, are responsible for the day-to-day operation. Members-managed LLCs are typical for small – to mid-sized companies. Management-managed LLCs are more prevalent for larger-sized businesses or owners who prefer an easier managing position. In this instance, the members could choose to assign one or more members to manage day-to-day operations or hire employees to assume the responsibilities.

Why should you form an LLC?

There are numerous benefits when you form an LLC. It’s a very simple and cost-effective procedure, which makes it an ideal first step in making your online store “official.” This validation will affect you as a business owner, and also create confidence in the credibility of your “legit” brand in the prospective customers’ eyes. Being able to prove your business is a good idea, as it can increase your chances of securing external funding, like lenders or investors, and even potential business partners in the future.

How to create an LLC

Choose your name

The name you choose for your LLC is crucial for administrative reasons, but also the perception of your clients. Your company’s initial impression is what that person is likely to have of your company and you must choose the best impression.

The name you choose for your online store might require some time. The ideal name isn’t something that happens at once. Sometimes, it’s a process of brainstorming, and sometimes even collaboration. There are a lot of free tools, including Shopify’s business names generator which can help you get your creative juices flowing.

When you’ve settled on an address, conduct an exhaustive check to ensure that no one else has claimed it initially. A lot of states have business directories that you can look through. It is also advisable to search beyond your state, particularly if you are planning to market to a large market. Check Google or social media and domain names that are available to discover what’s available.

Get an EIN

The employer ID number (EIN) is a way to separate individuals from your company identity. It functions as your company’s identity card, which is also known as a social security number (SSN) in a way, in a sense. It’s a unique number used by the government for identifying your LLC.

To obtain an EIN You must visit the IRS website and complete an application online. The application is completely free, however, you’ll need to provide your private Taxpayer ID number. The process takes less than 15 minutes, and it’s completely online. Once you’ve completed the process, you’ll be able to get your EIN right away after successful completion.

Register your business

After you’ve got your EIN and the name of your business It’s time to start registering everything. Registration of your business is a relatively simple process, although there are additional requirements for merchants working in certain sectors such as food and beverages or CBD. It is also possible to get a license for your business by your industry and location.

Open a bank account

It’s much easier to keep your business and personal finances separated. Separating these accounts can also provide greater protection for those assets that are personal to you. You’ll require your business’s information, which includes EIN to open the business bank account.

Start building and launching your site

When you’re ready for sharing your brand new business with the rest of the world it’s time to start promoting and launching your store online. We’ve developed a useful Shopify checklist for launching your store to help you keep track of everything from inventory to marketing to fulfillment. Increase traffic to your website for your first sale.

Going forward on your LLC

The incorporation of an LLC can bring both mental and financial benefits to your online business. After you’ve created your LLC it is now possible to concentrate on the essential aspects of your business, and then take it wherever you’d like to take it.

How Do I Combine Multiple Blogs Under One Business Entity? What Are My Other Options?

If you’re an avid blogger you’re probably thinking about whether you should create a company to manage your blog. If you have two blogs, you’re likely to have more questions, ranging from “How do I merge two blogs?” To “Should I turn my second blog into a DBA, subsidiary, or LLC? “

To help you understand to make things easier for you, we’ve provided all you need to be aware of. In case you’re uncertain whether you should form a company in the first place or are considering setting up a subsidiary to your blog’s existing entity the answers you’ve been searching for are right here.

Do You Need to Form a Business for Your Blog?

The first thing to consider is do you need to establish a legal entity for your blog? To answer that question, you’ll have to know if your blog is financially viable and if it is to what degree.

If your blog earns you revenue and you are planning to keep growing it and grow, then you must consider making it a business and take it seriously as an entity. This includes keeping an eye on your financials and taxes as you would with a small-sized business and making a business plan for your blog to achieve your goals.

It is possible to make your blog financially profitable in a variety of ways. For instance:

  • Place pay-per-click advertisements on your website They are banner ads that are displayed on the top of the side of a web page. If you decide to utilize these, you’ll be compensated according to the number of clicks they generate.
  • Affiliate marketing: It involves forming a relationship with a business (such as Amazon) and then promoting their products or services through your site. The sales you make are tracked with a unique affiliate link. You get paid each time you earn an order or sign-up for the company.
  • Content sponsored by sponsors: It happens the time when you and another business can agree to sponsor a blog article. You could be paid for a one-time flat fee and you may also be paid according to visits or clicks. The content that is sponsored may also be the use of social media campaigns or simply sharing the content via your social media sites.
  • Selling services and products It is also possible to earn profits by selling products or services that relate to the content you post. If you have a blog about cooking such as this, for example, you might sell cookbooks or meal preparation services.

Whatever way your blog earns money the most important thing is when it earns to be profitable, you can certainly gain from making it an actual business.

In addition, if you earn more than $400 in a calendar year through your blog, you’ll be subject to self-employment tax regardless. In this scenario, you’ll probably want to create a company for your blog to reduce tax burdens for you.

To do this it is necessary to select the correct kind of business entity for your needs.

Choosing a Legal Entity for a Blog

Because blogs are available in virtually infinite dimensions and shapes and shapes, it’s an unsurprising fact that there’s no way to create a single-size blog-related business entity.

When evaluating businesses for your blog, you’ll have the ability to select from several feasible choices. For bloggers, these choices can be boiled down to three primary choices:

  • sole proprietorship is a sole proprietorship where you continue to manage your blog in your name, without having to complete any formal setup (or having any legal security).
  • Limited Liability Company (LLC) that allows you to create your blog as your own company and maintain complete control over it while safeguarding your possessions.
  • An S Corporation In which you can establish your blog as a corporate entity and safeguard your assets for as if you are less than 100 shareholders.

Which one is the best for you? You’ll likely be satisfied with a sole proprietorship if you

  • Are you ready to place your assets on the line
  • Manage your business completely by yourself
  • Do not wish to fill in any forms
  • Aren’t ready to sign a formal agreement to form an organization

However, on the flip side of that you might consider turning your website into an LLC if:

  • Legal liability protection
  • Do you want to establish credibility with any potential partners or customers
  • Your business can be run in a partnership or on your own
  • Are you looking to segregate your assets from the business?
  • Do not anticipate or have to own any shares

In the end, the final option is an S company could be the best option for you if you wish to establish your blog as an LLC, but do not have or expect to have shareholders.

The general rule is that an LLC could be an ideal choice for bloggers since it protects your assets and doesn’t require a ton of documentation.

How Do I Merge Two Blogs Under One Business Entity?

It’s not unusual for bloggers to own several blogs, and it’s not unusual for YouTubers with more than one channel. If this is the case with you, you may be wondering what to do when you decide to merge two blogs into one company.

The simplest course of action is to form an LLC to run your primary blog and then operate your second blog under the LLC’s name as a DBA (doing business under the name). Based on the person you talk to the question, the term “dBA” can refer to DBA can be called:

  • Fictitious name
  • Trade name
  • Assumed name

If you decide to follow this path you’ll be able to manage two blogs that are legitimate businesses without having to deal with the paperwork and costs for two legal organizations.

This means that you will not receive any tax advantages (or suffer any disadvantages). Instead, the company is going to be taxed in the same manner as a normal business.

What Are My Other Options?

Although it’s easy and simple to join two blogs within the same business entity using the DBA, however, there are some situations where you could benefit from operating each as an independent entity.

For instance, perhaps you’re looking to share the ownership of your blog’s secondary one with a third party, such as a company or individual. Perhaps you prefer to safeguard the assets of your primary blog from any debts that your secondary blog could incur.

In these cases you may segregate your two blogs using one of the following:

  • Making the blog into a subsidiary
  • Establishing a completely distinct business entity, for example, an LLC for each blog.

If you choose to turn your blog into a subsidiary, or separate entity it can make your tax burden more complicated than if just create a DBA.

In both cases, the second blog will be regarded as independent of the primary one and therefore taxed in a different manner. In this way, you’ll have to pay taxes on two companies rather than only one.

In the end, the most effective approach for your blog and you will be determined by your requirements, desires, and strategies.

If you’re doing your homework and researching thoroughly each option You’ll be able to make the right choice that will enable your blogs (and your profits) to grow.