What do you think? Any ideas.

Wow!!

I thought everybody had an opinion <img src="/ubbt/images/graemlins/eek.gif" alt="" />

LU,

Fine idea. There are numerous businesses out there that have no idea how to manage money, process payroll, file and pay the proper taxes monthly, quarterly and annually.

Plus even if you don't make a ton of money you'll get the opportunity to write off a lot of expenses such as business meals, travel, mileage, etc. If you are doing this from home be wary of the home office deduction because that often red flags your tax return.

How are you planning to set up your business? If you are going to really pursue this business for years and attempt to build a larger business it may behoove you to set it up properly at the beginning. If you want to minimize your self employment taxes I suggest 2 limited liability companien. The parent company would be owned 50-50 by you and your spouse, include the word "investment company" in the name and put any and all capital in the name of that company and have that company "invest" in the operating company of which it owns 60%. The subsidiary would then be your operating Limited Liability Company and it would be owned 60% by the parent company, 30% by you and 10% by your spouse. At the end of the day, only the 30% owned by you individually would be subject to self employment taxes.

Of course, please consult your own tax advisor about the above scheme, however, I had to talk my own accountant into it at first. Fortunately, I am a tax attorney and had access to the code and supporting materials to demonstrate the viability of such scheme.

If you plan on leasing space, let me know, as their is language in many leases (which if not there I'd recommend you put it) which makes this parent-subsidiary relationship even more legitimate. For example, many leases say if you sell more than 50% of the subsidiary the lease is null and void and must be renegotiated. Well, if you sell your combined 40% and the parent company together, only 40% of the subsidiary has actually been transferred as the parent still owns 60%. This gives the parent a more legitimate "business purpose" thus it should never be recharacterized as a tax sham.

Good luck with your new endeavor,

Mr. Wondering

Mr. Wondering,

I have done bookkeeping for large companies for 20 years. I am time of working for everyone else and not making any money. I really just want to do something small and go from their.

I do not have any formal training but have done this work for the past 20 years. Not have the legal has really held me back and made me afraid to take the chance.

I really need a change. I want to do some good for myself for a change.