Start farm llc or not? Advice please

[PapaPerk]

I agree with what's been said here. Bottom line, the LLC is treated like personal income so no tax advantage but it does offer some liability protection for your other assets. And its very easy to set one up - just file a few papers. But the surprise I got with mine was the unrelenting stream of paperwork that followed. Everyone complains about government demands on small business but you'll really get a taste for it once you establish a business tax ID. Both the state and the feds will want reports on income, withholding, sales tax collections, employees, unemployment insurance, and so on -- sometimes even if you don't have employees. But given the liability protection, I would still say its worth it.

Would the government hassle a farm business line this? Thanks for the info.

 

[teejk]

Would the government hassle a farm business line this? Thanks for the info.

From what I understand, to get the full legal buffer from an LLC you have to do your best to establish it as an entity apart from you so a separate Federal ID# will be needed on bank accounts and other stuff. If you don't have any employees then no big deal dealing with the paperwork, If you do have employees then you would need to get a separate FEIN as well and the paperwork is the same. As stated above, the only meaningful difference with/without an LLC is the legal buffer it provides (and as noted above, it will not make you "bullet proof" from stupid stuff you might do, but it does make it harder for a hungry lawyer).

 

[DrRod]

For the most part, the computers and the staff don't know or care what line of business you are in. If you show up as a business on the state roster then you get the state's standard set of paperwork even when it doesn't apply. But as indicated elsewhere, it is much more simple if you don't have employees. Still, I would get a questionnaire asking about employees even when I didn't have them and they also included salary survey paperwork periodically. And I would get something from the state franchise office every so often and I never learned what that was about. The biggest thing is to ensure that you file quarterly sales tax reports [usually online or by phone] and send in tax payments so you don't get behind. This is managable so I wouldn't want to discourage you from pursuing the LLC path if you think it would help you.