This section of the forum is for discussing the business and finance issues of the t-shirt industry. Which business structure to use (sole proprietor, LLC, S Corp, etc), how to handle billing, where to register your business and get the proper licensing, etc.
Was Curious To Know Since We All Are In The Same Field What Legal Entity Some Of You Have Chosen To Become?? Does It Matter What State You Are From?? I Am Famliliar With Soel Proprietorships And Llcs And Corps And The Advantages And Disadvanatges But Just Wanted To Know What Some Of The More Experienced Users In The Tshirt Industry Have Chosen??
Thanks In Advance For The Help
If you are mainly going to be running a simple one-man operation, I would go with sole proprietorship. You probably already know the costs and requirements of setting up a corporation, so I won't push what you already know. I am going to be setting up as a sole proprietor, as I will run the business by myself, and be funding at least 90% of funds. As I start to grow, however, I will consider switching to a LLC. We'll see how it goes.
I also considered starting as a sole-proprietor, but decided on an LLC just for the peace of mind of minimizing my liability.
I would hate to lose a chunk of my personal assets due to my business venture.
Granted, LLC is not a complete safety blanket against losing my personal assets in a settlement, but there's certainly more protection than in a sole proprietorship.
One thing that concerned me about the LLC is the franchise tax that I would be forced to pay in TEXAS (my homestate). However, I found that would not apply to me for at least a while now, so the LLC wound up being MY PERSONAL best option.
BTW, your location/state DEFINITELY MATTERS. Please familiarize yourself with how local law/regulations/taxes might help you choose the right option for YOU.
Poe-Boy,
I'm also from San Antonio I just got my DBA where would i go to get a resale/or tax exempt or any other license/forms to complete, to get my biz off the ground?
I'm a sole proprietor, but have been thinking for a while about changing to LLC. I've thought of doing it online - has anyone tried that? At what stage do you think the business is big enough that it makes sense to change to a LLC? I've been wondering about that a lot!
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Poe-Boy,
I'm also from San Antonio I just got my DBA where would i go to get a resale/or tax exempt or any other license/forms to complete, to get my biz off the ground?
The following site is a TREASURE of info on just that subject for those of us in TEXAS.
I'm not an expert so I called an accountant. I was told that initially being a sole proprietor was fine if I wasn't going to have employees. If you have employees or start making really good money switch to a LLC to limit your liabilities and use the tax advantages
llc's are perfect no need for a corporation but more protection than being a sole propreitorship
I wouldn't go as far as saying they are perfect, considering almost every state has different laws for them.
I would rather have a C-Corporation, but don't have enough knowledge or enough finances to go that route yet. I'm sticking with an LLC for now and will eventually start the process to switch over as I expand.
Tax years doesn't have to be a calendar year: Our tax year ends June 30. This gives us more time to work with our CPA and he isn't busy at that time of year. Retained Earnings: We don't have to take everything as taxable income Benefit Plans: Nearly all our benefits are tax free. The C corp offers the most options for this. The benefits must be offered to all employees and be documented, but if you are the only one then you are good to go. Dividends: No payroll tax on them. Recognized Entity: Just what it says, the IRS recognizes the C corp as its own entity, not so with an LLC.
There are many other benefits and each situation is different. You really need to talk to a tax guy, a CPA, and a Lawyer before you start.
I'm not an expert so I called an accountant. I was told that initially being a sole proprietor was fine if I wasn't going to have employees. If you have employees or start making really good money switch to a LLC to limit your liabilities and use the tax advantages
We too are going by our cpa's thoughts.. on when its to our advantage to become a corp..
there are tax benifits to each type.. and an accountant is your best source to figure out which one is best.
for you at what time.
What Legal Entity To Choose?? 
