I made the jump to go on my own. I am going through all the options of how to register my business, taxes etc. A lawyer and my accountant both suggest starting as a sole proprietor and incorporating later when I grow. With the new tax laws and with a projected small income this seems to makes more tax sense.
I told that until I have an employee and an office that the real legal protection I have is from my insurance.
I am at choosing to be a sole proprietor, but it seems to make sense.
Anybody have any thoughts on this?
Thanks in advance.
BulgarBlogger
Mar 2, 18 2:44 pm
I registered my practice as a Professional Corporation (PC). If you are a sole proprietor, I'm not sure if you can register a name as anything else but your name - i.e. John Doe Architect. I'm not sure if this is what you want to do. If you register your business as an S-Corp, then the corporation is effectively a pass-through entity and you get taxed at the individual level rather than at the corporate level and you also get the protections of a corporation. Be weary though, you can't just form any type of corporation. An LLC and regular Corporations and not allowed to legally offer architectural services in NYS. If down the road you want to hire employees who want to do IDP, then you may be screwing them over because their IDP won't count if they work at an LLC or regular corporation.
BKarch
Mar 2, 18 5:32 pm
Thanks Bulgar.
I am considering PC as an S-Corp vs. sole proprietor. The catch with pass-through for an S-Corp, as my accountant explained, is that I have to pay my self a “reasoable wage” first which is paid before the 20% deduction on pass through. I don’t expect to earn much this first year so he said I would have to pay myself basically all that I earn. And that would mean higher taxes (I am married filing jointly to a high earner).
I am going to talk more to my lawyer friends about this.
BulgarBlogger
Mar 2, 18 6:06 pm
Do you have clients? Why start a business without any clients?
BKarch
Mar 2, 18 8:11 pm
Hit the ground running.
BKarch
Mar 2, 18 8:11 pm
Hit the ground running.
bennyc
Mar 6, 18 11:56 am
An S corp is just a type of corporation selection for tax pass through. An LLC can be an S-corp.
In NYS, in order to provide architectural services you can only do it through:
Sole Proprietor - where you are First Name, Laste Name Architect PLLC - Professional service LLC, Not LLC PC DPC LLP
Archinect,
I made the jump to go on my own. I am going through all the options of how to register my business, taxes etc. A lawyer and my accountant both suggest starting as a sole proprietor and incorporating later when I grow. With the new tax laws and with a projected small income this seems to makes more tax sense.
I told that until I have an employee and an office that the real legal protection I have is from my insurance.
I am at choosing to be a sole proprietor, but it seems to make sense.
Anybody have any thoughts on this?
Thanks in advance.
I registered my practice as a Professional Corporation (PC). If you are a sole proprietor, I'm not sure if you can register a name as anything else but your name - i.e. John Doe Architect. I'm not sure if this is what you want to do. If you register your business as an S-Corp, then the corporation is effectively a pass-through entity and you get taxed at the individual level rather than at the corporate level and you also get the protections of a corporation. Be weary though, you can't just form any type of corporation. An LLC and regular Corporations and not allowed to legally offer architectural services in NYS. If down the road you want to hire employees who want to do IDP, then you may be screwing them over because their IDP won't count if they work at an LLC or regular corporation.
Thanks Bulgar.
I am considering PC as an S-Corp vs. sole proprietor. The catch with pass-through for an S-Corp, as my accountant explained, is that I have to pay my self a “reasoable wage” first which is paid before the 20% deduction on pass through. I don’t expect to earn much this first year so he said I would have to pay myself basically all that I earn. And that would mean higher taxes (I am married filing jointly to a high earner).
I am going to talk more to my lawyer friends about this.
Do you have clients? Why start a business without any clients?
Hit the ground running.
Hit the ground running.
An S corp is just a type of corporation selection for tax pass through. An LLC can be an S-corp.
In NYS, in order to provide architectural services you can only do it through:
Sole Proprietor - where you are First Name, Laste Name Architect
PLLC - Professional service LLC, Not LLC
PC
DPC
LLP
This is as I understand it.