Because I just started my business (an LLC), I don't expect to be cash-flow positive for a while. Is it permissible to add funds to my business account as I need them? (The majority of my expenses will be mileage while making sales calls.) Or should I start with enough money to get me through the first six months?
You can definitely add funds to your business - you can loan your business the funds as suggested here or just put money into your business as equity to yourself. If you are single member LLC - it really does not matter as the IRS will still consider you and your business as one.
I really would not worry about this until you bring in partners or other members - until that point - you and your business are the same. - my opinion.
There are a couple of ways you can do this. But, yes, you can add personal funds to your business account. The best way, IMO, is to make a loan to your business - from yourself. And then, as funds come in, pay that loan back to yourself. I started a small business like this about 8 years ago (we closed it 2006) and paid off loans to myself (tax-free, of course) as soon as profits started coming in.
ChristineL | Former Moderator | 11/3/2009 - 10:00 am
phanio | Contributor | 11/2/2009 - 7:45 pm
jonathan21 | Window Shopper | 11/1/2009 - 2:37 pm
Join The Discussion
You must be logged in to join the discussion. If you already have an SBA Community account, Log In to join the discussion.
New users, Register for a new account and join the conversation today!