Self employment advice

[STx]

I'm of the opinion that an entity of some sort is of benefit for both the legal protection and, more importantly, avoiding SE taxes. It does cost you some money on additional state Franchise Tax filings but you'll more than make up for it avoiding the SE tax. I have an LLC that has elected to be taxed as an S-Corp, it gives me all the benefits of the corp without the administrative overhead.

I've always heard people say use a good CPA and attorney but over the years, I've been through a lot and none of them really gained me anything over what I was doing on my own. I use an attorney from time to time when I have specific questions and have a CPA prepare my corporate return but that's about the extent of that. The primary reason I use the CPA for my taxes is because corporate returns are exponentially less likely to be audited when prepared by a CPA (not that I'm worried about an audit but, who needs the hassle?).

As to insurance, only you know what the risks are in your field and for the services you'll be providing. Maybe you can't mess up anything significant and don't need any liability insurance. Maybe a bad decision by you could cost your client a hundred million dollars and you need to be protected from that, both in a consulting agreement and liability insurance. A good, independent insurance agent is the one professional I have found useful. If they're honest and not just trying to sell you something, they can really help to make sure your coverage is appropriate.

Good luck, now is a pretty risky time to be going into O&G consulting. I hope it works out better than you could ever expect.

 

[Budweiser John]

I have been self employed my entire working life.
In the last fifty years I've learned several things:
1. You work like ****
2. The work week is not necessarily 40 hours
3. Your spouse and family must be on board with your goals.
4. Hire a CPA
5. Some years are better than others.
B. John

 

[Budweiser John]

I have been self employed my entire working life.
In the last fifty years I've learned several things:
1. You work like ****
2. The work week is not necessarily 40 hours
3. Your spouse and family must be on board with your goals.
4. Hire a CPA
5. Some years are better than others.
B. John

 

[kevin37b]

Kevin, are you just an internet prick or are you also a prick in real life? I'm guessing the latter.

I don't see where my questions to get some basic input from some others that have gone down this path, should illicit a crappy post like that.

I owe you an apology . I am sorry .

 

[EddieWalker]

I was wondering if you would do this after talking to you a couple weeks ago. Glad to see you're exploring your options and considering the big move. For me, it was very scary going out on my own. I spent a year and a half doing all the research I could, including talking to several lawyers, CPA's and friends that owned business's. Advice was all over the place and it was very hard if not impossible to know what was usable advice and what was just self serving. Lots of people seem to want tell you what to do that is all about them. The so called professionals, CPA and Lawyers, where very vague and in my case, a total waste of time. In my opinion, they are best after you have done something and then fixing it.

The SBDC is where I got the best advice. They had all sorts of pamphlet that I felt where excellent at explaining what to do and examples of how to do it. If you ever have to write a Bussiness Plan, their examples where better then any of the dozen books I bought.

My advice it to give it a try. Better to fail then to never know if you could do it or not.

My experience has been very good. But I have had several periods where I was down to having to use my credit card to buy gas and not sure when I would get paid again. Worse case for me was when I had less then $300 in the bank, bills due at the end of the month and not one single phone call for work. There is a panic, fear that grows every day when that happens. If you work for yourself, you have to realize that sooner or later, that is a very real possibility. There is also the fear that the phone will stop ringing. Right now with the collapse of oil, I've had clients cancel jobs and postpone them. I'm still working, but who knows for how long?

 

[roadhunter]

Good advice so far. Owning your own business can be the everything from the most rewarding to the most difficult part of your life depending on the situation from my experience. Some people are just not happy working for others and love the independence and freedom that being self employed offers. Other people like the stability and steady paycheck that working for others provides them. You just have to decide what type of person you are. At 5 on Friday do you want to go do your own thing and forget about work? Or are you willing to work wherever work needs to be done be it after hours of weekends?

Having a supporting wife is key to making it work as well. Getting her on board is mandatory.

I have been both successful and failed miserably starting businesses but it is what I enjoy doing and I would not have it any other way.

 

[forgeblast]

I carve (spoons and bowls) as a supplemental income. I had to get a dba (doing business as) liability insurance, register with the state, register with the state to pay sale/use tax. I also keep the supplemental income in a separate account to help with record keeping.
We just had southwestern lay off a lot of oil and gas workers in our area, cabot is holding but not hiring. Going to take a bit to get the pipe lines done.

 

[forgeblast]

I carve (spoons and bowls) as a supplemental income. I had to get a dba (doing business as) liability insurance, register with the state, register with the state to pay sale/use tax. I also keep the supplemental income in a separate account to help with record keeping.
We just had southwestern lay off a lot of oil and gas workers in our area, cabot is holding but not hiring. Going to take a bit to get the pipe lines done.

 

[gsganzer]

Thanks folks, I appreciate the great advice so far.

The great thing is that I don't need this to turn into a high paying income or turn into anything larger than me doing occasional contract work. However, I'm feeling around in case I decide to turn it into something larger in the future. The simple thing is for me to just contract through a payroll agency whenever a customer wants me to go consult for them. I've had a number of contractors that I've used over the years that have done it that way and it works fine. The issue with that scenario is that if I ever went on my own, I wouldn't be able to contract directly with that customer, due to protection clauses I had with the payroll agency.

Eddie,
Thanks. You're advice is solid with the SBDC as others have also recommended. I'll check into that next week. As you can guess, this decision has been a long time coming. I've actually started to get the spring back in my step knowing that it's time to move on. Good things will come.

 

[gsganzer]

I owe you an apology . I am sorry .

No worries Kevin. Sent you a PM to put this to bed.:drink: