Cake Business Question...

Business By MasterPiecesCakeArt Updated 24 Nov 2009 , 4:34am by leah_s

MasterPiecesCakeArt Posted 21 Nov 2009 , 2:04pm
post #1 of 15

I'm working on starting the business officially. Does anyone have recommendations on whether the business should it be a Sole Proprietorship or an LLC?

14 replies
sherrycanary62 Posted 21 Nov 2009 , 2:46pm
post #2 of 15

check out the cake decorating business section here, there are tons of advice and suggestions.

indydebi Posted 21 Nov 2009 , 3:05pm
post #3 of 15

definitely check out the business forum for LOTS of good info, but I vote for LLC.

cylstrial Posted 21 Nov 2009 , 5:52pm
post #4 of 15
cabecakes Posted 21 Nov 2009 , 6:05pm
post #5 of 15

A limited liability would be probably be your best bet.

11cupcakes Posted 23 Nov 2009 , 2:26pm
post #6 of 15

I think you should go with LLC, but I would get ligal adviser.

costumeczar Posted 23 Nov 2009 , 2:29pm
post #7 of 15

I vote for LLC, since I was a Sole Prop for a while, then changed over to an LLC. I basically had to all the paperwork again, so it would be easier to just go that way from the beginning.

-K8memphis Posted 23 Nov 2009 , 2:41pm
post #8 of 15

When I went to the Small Business Assoc, I was all into incorporating. He said sole proprietor--my sister was in business (not caking) for about 15 years before she incorporated. It seems most of us do LLC from the get go now but I was advised against it initially then change over later after you get all the tax breaks. So another view fwiw.

KHalstead Posted 23 Nov 2009 , 2:53pm
post #9 of 15

what are the advantages/disadvantages of both?

leah_s Posted 23 Nov 2009 , 2:53pm
post #10 of 15

I'd throw S Corp into he mix, also as another option to investigate. LLC wasn't around in the "olden days" when I incorporated, so S Corp was my only real option, because I wasn't going to even seriously consider the Sole proprietor route.

indydebi Posted 23 Nov 2009 , 4:02pm
post #11 of 15

As my attorney explained it to me.....

LLC - let's say you get hit by a bus, you're in the hospital for surgery, you have months of recuperating, and you have to close your business. Because you haven't worked in months, there are financial difficulties to work thru. The bank that holds the lein on your equipment can take the equipment, of course. But you owe $10,000 on equipment that has a used-resale value of $3000 (there's a recession ya know!).

With a sole proprietorship, the bank can 'cross the business line' and try to get the rest of their money thru your personal assets. With an LLC, there is a barrier between you-the-business and you-the-person.

The LLC protects you, your home, your car, your other household income, etc.

It costs minimal to do the LLC, it's not any harder to keep the books for it. I started as a sole prop simply because I didn't know any better. Having been an LLC for awhile, I'd never do a business any other way. Ever.

KHalstead Posted 23 Nov 2009 , 10:06pm
post #12 of 15

so basically there's a LOT more protection being an LLC if you get sued or can't work! seems like the way to go then!

I think for me it's $40.00 flat out all together to be sole proprietor and $200.00 for LLC...not sure if that was a one time thing or yearly though.

snarkybaker Posted 23 Nov 2009 , 10:19pm
post #13 of 15

Most states will charge you a " filing fee" for your LLC annual report. Ours is $400. LLC is a nice hybrid between sole propietership/partenrship and a corporations. You can still file the simpler tax forms, but get the ersonal protection of a corporate structure.

yumcake06 Posted 23 Nov 2009 , 10:30pm
post #14 of 15
Originally Posted by costumeczar

I vote for LLC, since I was a Sole Prop for a while, then changed over to an LLC. I basically had to all the paperwork again, so it would be easier to just go that way from the beginning.

Yeap that is correct as an LLC you can just add on employees too without having to change anything

leah_s Posted 24 Nov 2009 , 4:34am
post #15 of 15

all that also applies to an S Corp.

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