Starting an LLC

Jay Rodriguez

Jay Rodriguez

Coffee Member
Ok, so who did it? I'm starting to look back into it and I know a few people who has done this on their own but I also know a few guys who hired a lawyer to do it. Problem is, I've never asked them how to do it.

So, what's a good way to do it. Hire a lawyer or take on the task myself? If you suggest DIY then where do I start?

Jay


PS, Just got off the phone with my wife. God I just want to ring her neck sometimes.
 
Ahhh... so that's what you're doing with the $37K(?).

I don't have any advice for you. In fact, I hope to glean something from this thread as I, too, am looking into an LLC.

Ya down with LLC? Yeah, you know me! :)
 
Well, funny thing is that the night that I got into the accident I was talking to someone about starting this process so yeah, some of the $ will help tackle that.

I'm down with OPP I mean LLC.
 
I started an LLC last June.
I would highly recommend talking to both an attorney and a CPA - or ideally a Tax attorney (which I didn't have access to).

The way you go about it can change from state to state - so I don't know how much good specific info on what I did is. If you find your state Attorney General's website it probably has all the information you need.
 
Legal Zoom is fine, and I know a few filmmakers who have used them, however, it's not an attorney working with you face to face. We used a real life attorney. It cost us more but in the long run it's a more secure option than these fly by night websites who can get you an Llc by morning. Contact an entertainment attorney who handles icorporating, you'll be happy you did. I can even reccomend you to ours if you'd like, just e-mail me.

By the way, going the Llc route is the way to go. Get it out of the way and save yourself a ton of liability and red tape down the road. Protect yourself and your partners/investors. It'll take about 3 weeks to get it all done (mostly the attorney's work) but as mentioned it's all worth it in the end.

Good luck.
 
alveraz said:
Legal Zoom is fine, and I know a few filmmakers who have used them, however, it's not an attorney working with you face to face. We used a real life attorney. It cost us more but in the long run it's a more secure option than these fly by night websites who can get you an Llc by morning. Contact an entertainment attorney who handles icorporating, you'll be happy you did. I can even reccomend you to ours if you'd like, just e-mail me.

By the way, going the Llc route is the way to go. Get it out of the way and save yourself a ton of liability and red tape down the road. Protect yourself and your partners/investors. It'll take about 3 weeks to get it all done (mostly the attorney's work) but as mentioned it's all worth it in the end.

Good luck.
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What ballpark ($$$) are we talking here?
 
Jay, had same problem back in May. I had to decide whether to register my business as a LLC or a Sole Proprietorship. I chose to register as a Sole Pro. mainly because I as owner was only employee and there are some tax differences between the two. There are also other legal differences e.g. can you be held responsible if someone sues. As a Sole Pro. if I decide to expand and hire.... going to an LLC wouldn't be difficult.
Obviously speaking to a lawyer and CPA to get info would be helpful.
Maybe this site could help...... alot of info on starting a biz in NJ.


http://nj.gov/njbgs/
 
Brownhood's right - first step is to decide if an LLC is the best way to go for you.
Everyone's situation is different.

I would also second Alveraz's suggestion about working with an individual as opposed to just a website.

I suggested a CPA as well as an attorney because I found when I was setting up my business that each attorney I talkedd to would inevitable tell me "I'm not a CPA, but I think that....." and so when I started talkign to CPAs, they told me "I'm no attorney, but I think that...."

A good attorney will be able to help you figure out the best way to structure your business in terms of liability (limiting your exposure to suits).
A good CPA will be able to help you figure out the best way to structure your business in terms of your finances and tax payments - weighing the saving with the efficiency.

Initially - you're probably right to lean towards an LLC.
But make sure you examine the options and understand the differences.

Filling out the paperwork and filing with the state isnt' the tricky part - it's figuring out exactly what to do given the options. And I think individual experts woudl be able to help you in understanding your options much more than a website would.

Just my 2 cents.
 
Why do you need an attorney ? Are you opening a business ?

Legalzoom can do it for a small fee with no hassle. I started my comapny with Legalszooms help (a Type S Corp) and have since moved to an R.A. for my Agent needs
 
I don't think an attorney is always necessary. If anything hire them for an hour to review your docs, but I've spent thousands on both LLC's and Limited Partnerships only to find that with digging and research you can do it on your own. Places like Legalzoom and others pretty much work up "boilerplate" documents, which more often than not are going to be just like the ones your lawyer would draw up, but they will charge massive fees to have somebody else do the legwork, add their fee and bingo...lots of money.

I think attorneys and CPA'a are very important to the process if you're doing complex things, but most states have ways to file your own LLC's and such electronically so i don't really think these docs are very complex. I haven't done it here in Arizona yet, but my friend says he's filed his LLC for under $100.

As a side note if anybody is going to file for a Limited Partnership to raise funds for a film project, you can still get sued as well (even personally) if you have yourself set up as an LLC and then your LLC is one of the managing members of the Limited Partnership you then give yourself an extra blanket of protection.

In the end lawyers or no lawyers, LLC or not if somebody wants to sue you it's almost impossible to protect yourself 100%. Not to be negative, but I think people put so much stock into legal docs (as do I) but just keep your eyes open and research, research, research.

Also, if anybody wants a boiler plate of a Limited Partnership that I spent about $1500 let me know. I'm in the process of changing it over to a new project many years later, but it's a start. They do vary a bit from state to state, but you could go through and try and put in your own info and then take it to an attorney or better yet a paralegal have them spend a couple hours modifying it and then you will have save a thousand bucks. If anybody gets ready for a project where you might need it just PM me. Give me a couple of days to get back to you, because I'll be out of town for a week.

best,

Jason
 
The only reason I mentioned it may be safer to use a real attorney over an online service is a story I heard a while back regarding a filmmaker who was sued and had much less security with the online service than most who have an actual attorney who takes a more detailed and tailored approach to your needs, hence giving you a stronger leg to stand on. Apparently there were several 'loopholes' in his contract developed with the online service.

However, I'm sure these services are just fine, just not what I did that's all. Like mentioned with or without an attorney you're still screwed if you're sued, really.
 
I'm not a CPA or a Lawyer, but I am a CFA and MBA who knows a lot about organizational structures because I'm a financial analyst who reviews stuff like this from time to time, and I've been directly involved with a few startups, including a personal software business. With that intro, I think you folks should also look into something called an "S Corporation." As with an LLC, an S-Corp also has the benefits of limited liability with income/taxes passthrough (no double-taxation like a C-Corp would have). The other differences carry various pros and cons related to reporting requirements, self-employment taxes, ownership rules, ease of transferability to new owners, and more.

Anyway, I thought it was worth noting for the sake of others thinking about setting up an LLC to not overlook going the S-Corp route as well. Any lawyer or CPA could tell you what they are and why you might be better off going S-corp instead of LLC. And as far as setting one up yourself, it's actually not even that bad. Some paperwork, some $, and sometimes a public notice, and maybe a couple of other lose ends. You don't need an Internet service either, you just need to know what paperwork to fill out and where to turn it in for your state.
 
If you're looking for certain tax benefits, look into an S-Corp. LLC is a pass-through tax setup, meaning all the income shows on your return and you have to file it as your personal income. But, if you're just looking for basic liability protection, LLC is a good bet


edit: DOH should've read the post above. Good points.
 
kai said:
If you're looking for certain tax benefits, look into an S-Corp. LLC is a pass-through tax setup, meaning all the income shows on your return and you have to file it as your personal income. But, if you're just looking for basic liability protection, LLC is a good bet


edit: DOH should've read the post above. Good points.
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FYI: S-Corp passes through taxes the same way LLCs do, but there are differences that are important to understand.
 
Tainted said:
FYI: S-Corp passes through taxes the same way LLCs do, but there are differences that are important to understand.
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That's the biggest reason to go talk to a CPA or an Attorney who can clarify these details for you.

Granted - I agree, you CAN set up an LLC or S-Corp on your own. Setting up the business and filing the paperwork isn't difficult - but it's nice to have the piece of mind that you understand the differences between your options, and to feel that you're doing things the best way for your particular situation.

Besides - any money you spend on a CPA or Attorney should be a deductible business expense.
 
the record keeping/"annual meetings", etc on an s-corp can be a real pain as well. Do all the homework before you choose.
 
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