When starting O/O is Inc., LLC or sole proprietorship preferred?

My understanding is that you would need to register in the main state you are based in. So if you got a NV corporation and lived in CA you would need to register in CA. I have not heard of anyone registering in all the states they run in or PU/Delv in.

 

You register in one State, usually your home State. You might have that and IRP confused?

I did it myself and saved $$. I'm set up as a single member LLC.

 

Getting back to the title of your post...it all depends on how much money you plan to make. Sole prop. all the net revenue is taxed at your individual rate which you'll be paying self employment taxes on all of that. Corp. or LLC you'll eliminate some of the self employment tax, but you'll more than likely inccur more accounting charges. I elected to do the s-corp and don't really pay a whole lot of tax, of course I had a lot to deduct. My company issues myself a W2 every year and that is what I pay my personal taxes on. Any profits made by my corp. can stay in the corp and be taxed at that rate...and there is a lot you can write off. Keep in mind, a good accountant will always provide way more in tax savings than their fees incurr.

 

you can incorperate anywhere but you run the chance of your home state taxing you as a foreign corperation.


if it's just you and your truck sole proprietor is fine. If you put more guys or trucks on your authority then look at incorperating

 

If I file for llc and include my one driver as a partner on llc filing then can I be exempt from needing to pay workers comp here in CA being he would be a part owner of the business and not an employee. I just hired a driver and the quote for WC was $817 a month which only covers him not me if he is injured on the job. I can get health insurance for both of us for around $400 a month and we would both be covered on and off the job .... It won't cover lost wages but this driver on last job worked 14 years and never made a WC claim so if he drives with me as an employee and I pay $817 a month that would be well over $120k over 14 years with nothing to show for it. As part owner with health insurance instead I save over $60k and we are both covered on and off the job. Does anyone know if llc Filing will exempt me from paying WC here in CA ?

 

DHF, that is a good question. I grew up in CA and lived there until a couple of years ago. Hving run several businesses, WC in CA was always a pain and expensive. But if you do something like this you need to make sure it is legal and not just a way to avoid WC. CA is one of the most aggesive states for prosecuting companies for not providing WC when required.

 

Thanx BBB.... I will be calling some WC attorneys etc to get the legal opinion.
On the surface it makes sense that if the driver is a partner and part owner he then technically would not be an employee but WC is a bureaucratic system and could have lobbied to plug up other alternatives even tho it would make much more sense to opt for health insurance. My guess is over half the 9000 a year they want to just cover 1 employee goes into the pocket of WC insurance broker and those who run the system. In the words of Johnny Paycheck ..... They can stick their form where the sun don't shine ! If they insist I pay those outlandish fees I will forego the lease / subcontractor angle or just not have
another driver.

 

I just spoke with the workers comp Sacramento division Information and assistance unit and was told workers comp would not be required of owners under either an LLC or partnership filing but an owner within either filing can choose to pay into it. Filing an Llc and getting Health insurance for half the price makes more sense as both partner and myself will be covered and it frees up $400 a month for fuel and repairs. I would go broke paying $817 a month into WC and I wouldn't even be covered. Good to know there is an alternative.