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Sole proprietor or LLC

by irelandsj, Window Shopper

  • Created: May 20, 2011, 11:26 pm
  • Updated: May 20, 2011, 11:27 pm
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4 comments

I'm starting a web business where I hope to earn income through google adwords and affiliate marketing. I am the only person in the business.  Tax wise, I need some help to determine whether to start an LLC or sole proprietorship? If I do the sole prop, what are the benefits of using my ss# or applying for a seperate TIN? Wha do I need to know tax wise in order to make the right decision for the business type?I already have a full time job, as does my husband. Thanks.Stephanie

Tags: Discuss Popular Topics, Starting & Registering a Business
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BizResearcher | Window Shopper | 4/10/2012 - 1:21 pm

I recommend that you DO NOT use your SS# as your business identification
number. If you do, you increase your risk of identity theft. Additionally,
many banks and corporations you may do business with will not accept a SS#.
It is quick and easy to obtain a tax ID number from the IRS, as well as much
safer.

jerome12 | Window Shopper | 4/6/2012 - 4:42 pm

Voting for both of the above comments. Yes, legally speaking, a limited
liability entity or sole proprietorship form of entity does not really
matter. The links shared by jjray and ngoriel provide wealth of information.
Professional Web Site: Dubai Law Firms

jjray | Window Shopper | 3/22/2012 - 3:06 pm

Stephanie, from a tax standpoint, it really does not matter whether you form as an LLC or sole proprietorship if are to be the sole owner. A single person LLC can file an election with the IRS to be treated as a disregarding entity (meaning the LLC will be treated as a sole proprietorship for tax purposes). Here is a site with more info on choice of entity. http://www.medlawplus.com/library/legal/businessentitychoice.htm
Joseph Raymond
Professional Web Site: VidExplorer, Video Aggregator and Social Network

ngoriel | Community Moderator | 5/23/2011 - 2:05 pm

Hi, check out our blog article “Should My Company be an LLC, an S-Corp or Both?” which has lots of good information about an LLC and S-Corp and the pros and cons of the LLC and the S-Corp.  Click http://community.sba.gov/community/blogs/community-blogs/business-law-advisor/should-my-company-be-llc-s-corp-or-both for the article.