I will be creating a business as a side work and create an LLC next year while working for corporate. Are there any good resources I can use to learn more about how I can use LLC to reduce my overall tax burden?
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- Microsoft gfba68LLCs do not limit your tax burden, it's just a shell. There are no tax moves available to an LLC that aren't available without one.
- I actually know quite a bit about taxes. More than you, obviously. I never said you can't deduct business expenses, just that you can't deduct a laptop for no reason. If it is a business expense you can deduct it regardless of whether or not you have an LLC. The legal form is completely irrelevant.
- Yes, you can infact reduce your tax burden with an LLC. Either buy cheap ass empty property in Nevada and register your business to that location or purchase a post office suite (basically giant PO Box) in Carson City or Reno Nevada.
Your relative tax burden will be slightly decreased by avoiding state taxes, but federal taxes will hit just as hard.
- Sure, you can do the location game just as a W2. However, your W2 will trace back to the location that you worked and you need multi-state filing. That benefit would be on things like personal capital gains.
However, if you plan to contract out services you will want the LLC for legally limiting your liabilities rather than let a lawsuit garnish 100% of your assets. If you’re going to make an LLC for the few legal benefits, maybe even a company needing a partner, then go ahead and be selective with your location.
- 1) It isn’t tax fraud by any stretch of the imagination to register a business in any given state.
2) I’m kind of assuming a LinkedIn person wants to run a Internet-based service with a low number of employees. My advice really only applies to a traveling contractor or remote work - I’m assuming this is a national level business. If this is a storefront, you will not stand to gain here(independent of any state we’re talking about)
3) If you do 95%+ of your business in 1 single non-registered state, then you probably won’t want to do this. Some states say that qualifies you to regulations of the non-registered state (probably the more liberal states).