time lapse photography of city during night time

A Corporation or Limited Liability

Are all businesses considered to be corporations? No! Considering the matter, all corporations are presumed to be companies, but not every company is a corporation. Corporations are also known as C corps; they usually are perceived to be large business entities. Shareholders are sometimes known as the owners of a corporation. There is also an S corp; it pays no taxes, and it has particular shareholder restrictions. The owner of an S corp is personally responsible for paying the taxes.

An LLC is not a corporation but considered a hybrid, a cross between a partnership, a sole proprietorship, or a corporation. An LLC is known as a limited liability company.

Both of the above entities are for financial protection against an angry customer who decides to sue the business. Having the security of INC or LLC, an owner can secure their personal property like cars, homes, etc., and protects them from business debts. They are still liable for taxes and private debt.

More of the smaller companies are getting LLCs to protect them from the patrons who would sue them. It seems more people out there are finding issues and reasons to bring litigation against a business. There is a personal gain to them without doing honest work. Creating lawsuits is their way of life. Though we dislike the possibility, companies can face legitimate cases.

Becoming an LLC or corporation can be expensive or not. The filing fee in each state is different. Prices can range from $45.00 to $5000.00, or even more. Remember, you receive what you pay for, no matter what it is. You can file for an LLC or corporation online or go to an attorney who handles such, or companies that manage only these types of enterprises. Each service provider charges extra fees for extra services. There are also several aspects of protection created inside an entity. To secure a private entity, you want to find a company that legally sets up your entity and registers it most securely. Registering your entity must be in a state known for filing said entities. There is a need for businesses to find and use the best security, be it brick and mortar or any digital online occupation. Just as in all decisions concerning your business, you must weigh the pros and cons. We choose what we deem best for ourselves and our situation. 

When we ran our garage business, the thought of being a corporation did not enter our minds. We worked and set aside funds each week for our taxes. We started small in a small building. We paid the rent, designated two bays for working, and hung the stock and equipment around on the walls. The guys made do with what they had. When it was necessary, they purchased more equipment to utilize in the garage area. Of course, they purchased tools as needed from the famous tool truck that came around each week. By the time we moved to the new location and a larger building, we had accumulated quite a conglomeration of tools and equipment to transport. Everything was packed up in the old shop with great excitement, and the boys moved into the new one. This new shop gave them more room, more employees, four bays, a separate room for parts and stock, and a designated office. We were all happy, and this is when we deemed it conducive to become a corporation.

It is with relief and a sense of freedom I have left behind the fiat oriented world of controlled business. I have moved into the digital decentralized crypto world of Compumatrix Networks International, INC. The security of our assets and wallets is still a crucial matter. We need protection for all avenues and endeavors attributed to our Compumatrix business.  

About the author

Carmen is a wife of 59 yrs., mother of five children, grandmother of 10 grandchildren and great grandmother to 6 great-grandchildren. She embraced the world of technology and became a member and a committed advocate of Compumatrix International.

Comments

  1. good info Carmen — and it definitely brought back some very good memories for me as i grow older and have some time to look back — i am actually looking at the S-corp again n LLC now that a few things are working individually –so have to get prepared as best — Thank You —

  2. Carmen once again a wonderful piece. My sister has her business fro scrap metals as a LLC. She does so for several reasons, and law suits is the major one, so she doesn’t have to worry about someone suing her for all that she has in case there is a serious accident. After all she had in the early days had metal fly off a truck and hit on coming vehicles. Of course there are good occasions for LLC, and also some use the system to insulate themselves from illegal doings as well, which is why the laws keep changing. But over all, most people are honest, and seek only to have the right things done; but one must protect what is your own.

  3. Interesting read, Carmen….the world of corporations even enter into the occupation of farming. This helped us save a lot on taxes when my husband retired and the machinery, tools, etc. were sold. A fond memory came forth when you mentioned the traveling tool truck – a Snap On Tool dealer periodically came around to the farms. Their tools were made very well, and thus the farmers welcomed this truck when it came into the yard. If we transfer cryptocurrency to fiat, corporations could help in our financial plan.

  4. Great info Carmen. Getting into an LLC or Corporation will be for the future for me. For now I just want to keep things as simple as possible. If I do end up making a bit of money from Compumatrix I definitely will conciser these things down the road. Great info.

  5. Good information Carmen. In this day and age someone is always out there looking to sue someone for free money. Always an excellent idea to keep your business assets separate as in a C Corp, an S Corp or LLC, from your personal assets so they can not be touched in case this happens to you.

  6. Well written Carmen, I have started multiple Corporations through out my years. From LLC’s to Non Profits, S-Corps and I really tend to like the LLC. But then again each is suited for it’s own purpose. We are actually in the process of starting another LLC the first of the year for my wife home business. But again a very well written piece.

  7. Thank you, Carmen, protection is critical, and we have been told for a while now how to be proactive in protecting our assets. I enjoyed your blog.

  8. Great post Carmen and yes it takes a lot of planning on how one can or will manage the incoming wealth.
    Planing to keep most of my income in Crypto, but still making plans to protect my assets. All can and will be done if and when there is enough income to justify it. Those kinds of protections are not cheap and so we will see and decide down the road or once I can see the need for it.

  9. Thank you Carmen,Planning is needed now,where to invest our assets with security,which way is better in the future?It is better to follow a path where there is safety.Thank you for sharing good information.

  10. There seems to be great disparity from country to country. Good advice from a local expert should always be sought before decisions are made that can potentially come back to bite you at some future date. Also keep an eye open for changes that have been introduced by governmemts or other authorities. Better safe than sorry. Step by step and follow advice.

  11. Informative blog there, I plan to seek advice locally and understand several ways to keep myself away from the bad guys, pay what I need to pay, thank you for putting together all this for our good.

  12. Again, Carmen, an interesting and informative blog. Years ago I had a small business buying and selling on eBay. I formed an LLC with help from an attorney, but it seemed to be that I was paying all of my profits to the attorney for ongoing fees. I dissolved that LLC but do plan to incorporate again for my Compumatrix business.

  13. Thank you for the informative blog Carmen. Let me introduce you to my world, the world of natural, vs man made / LLC’s, Corporations and so on. If you take a look at the letters, LLC, you will see that you’re in fact liable at a limited %, it’s all in the name, it’s right there, limited, liability? I learned many years ago, the difference between man made, and natural, which each and everyone of us are, but, you keep playing in their fictional system. When you let a 3rd party into your lives, you no longer own anything, you’re only using it. I could go on till the cows come home, but, to make a long story short, I would only use a natural trust, the very wealthy use them, not these fictional Corps. If you want to know more about my education on the natural trust, you can contact me,,,,,,,,,,,,,,,,,,,,,Cheers !!

  14. Wow, Carmen where were you when I first started out in business. I could have really used that information. It could have saved me so much time, energy, and effort as well as heartbreak. After a lot of trial & error, I did learn this valuable information through the school of hard knocks. But now I feel the same way you feel now learning a better way to build a mousetrap. I also have moved into the digital decentralized crypto world of Compumatrix Networks International, INC. Now my life will never be the same. Thanks for sharing, it was surely a lot of good information for those who choose to stay in the rat race.

  15. Carmen, you explained the two differences very well. Just the other day I read an entertainer had developed a corporation and she felt so safe so she went on performing her business duties that she was responsible for. A few years down the line she received a tax bill for thousand s of dollars. She then found out that her taxes were never filed. so you bought up a good point in separating fund for your taxes, this way you can make sure this part of your business is taken care of. Good post.

  16. Jeffery you make a good point. Almost every country has a different system for laws, taxes, companies and corporations. It is down to each individual to research what is the best way forward for them wherever they are living or intend to live. Just remember that when you search online don’t always believe what you find on the first page of google!!

  17. Dan, I read your comment with interest and headed off to do some research. As per usual there is plenty of conflicting information out there. When you have time please do send me a message or some of the your information on the Natural Trusts. Thanks

  18. Incorporating a business is a big step. I agree that in many jurisdictions, it is prudent to get there as fast as you can – In jurisdictions where people are ‘sue happy’ and the public is worked with on a regular basis, yes. Having been in both worlds, I prefer the independent system, with similar protections in place, via different means, to cover the same contingencies. We all have to be responsible for our behavior and any damage we do.

  19. Love the way you worded that Albert John Willms. I completely agree that it is enormously important to find the best solution for wherever you are and take responsibility for your choices and actions. I am so glad that I have seen more than one world, however crazy it might be sometimes.

  20. This is excellant information as we had a trucking company set up in an LLC and when I had my strokes in 2018 and had to sale everything but kept the pickup from the LLC it cost a lost to get out from under all the bills etc associated with the LLC. We are still trying to rise above water, it has been a struggle for us, so I do not know if an LLC is the way to go when a person needs out or major medical hits.

  21. Dear Carmen thank you for the wonderful blog. As I continued to read I kept waiting for a recommendation on what type of entity we should set up being a compumatrix member. Do you have any specific recommendatios that we should move forward with in the near term? Secondly keeping things simple, seamless and the easiest path? Not to mention the best tax benefits.

  22. Carmen you bring up several good points that we all may need to look at with our Compumatrix business. In the past I have opened LLC’s for business that my family has started. LLC’s and Corporations have ways to protect your family but each business is different with various needs.

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