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15

An LLC protects you from personally from all creditors, whether they be customers, shareholders, or other parties. Liability for business activities is limited to the LLC's assets; yours are protected. Nolo's LLC Basics describes this well: Like shareholders of a corporation, all LLC owners are protected from personal liability for business debts and ...


10

According to the IRS, all self-employed persons are generally required to file quarterly self-employment and income tax payments that are based off your estimated yearly earnings. There are exemptions to this rule, as outlined on the IRS page for self-employed individuals, for those that don't make a net profit. As for working another job where you do pay ...


10

It should be remembered that with any form of Limited Liability structure (LLC, Ltd, PLC) etc the liability is limited only to the shareholders or members. In the event of a company failing, other than losing their investment, shareholders/members are only liable for any unpaid share purchase money (or nil, if all shares are fully paid up). Beyond that, ...


8

There are many variables. In short words, you have to know how to licence your work and this should happen when you write the contract with the client. Of course, there are many aspects of the problem you should consider: Does the work contain parts over which your client has full copyright (logo, text, colors, design, source code, trademarks)? What can ...


8

Why the are not choosing you? The reasons may be: They prefer working with some in the USA. In case things go bad, they can always sue USA contractor. USA contractors are also aware of this. Price of the project - large project are usually not being subcontracted outside USA Remote workers are unreliable. I heard this sentence from many clients who tried ...


7

In my experience, clients who I've done contract work for haven't asked for this until the end of the fiscal year, when their accountant starts pressing them to get their taxes in order. My experience comes from dealing with small startups, where there's not a lot of process in place. The mutual trust came from the fact that they already paid me hundreds or ...


7

I think the definitive answer to this question is very strongly dependent upon the region in which you're considering doing business, so I think you could improve your question by including a region-specific tag or at least mentioning the country (perhaps even state) where the business transaction would take place. In particular, in the US, barter exchanges ...


6

LLC disadvantages vs. sole proprietorship: Government fees to establish and maintain the LLC (usually $100-$500 first year and up to $100 subsequent years, depending on your state). Paperwork to to establish and maintain the LLC. However, in some states, this is nearly zero - just a few minutes of filling out government web forms. That's it. Taxes are the ...


6

Regarding taxes, in theory (at least in the US) you are supposed to report fair value of goods received but that is difficult to quantify. After all nothing has a singular, objective fair market value but rather a range of plausible values. The way I do it is simply to invoice the customer for the fair value of my services, and then buy their goods and ...


6

I would suggest asking for a contract to be made, or you make one and ask it to be signed. The purpose of a contract is to protect both parties. You can simply state (the contract should be more in depth than the following "In the unforeseen event that there is a breach in data I cannot be held responsible for any HIPPA violations". I would include that you ...


5

It's probably reasonable for you to make a rough estimate of the percentage of business use for your home office and Internet. You could keep a diary for a week or a month, noting down your hours for personal and business use and then extrapolate these numbers for the whole year. There is no easy way for the tax department to check the actual percentages so ...


5

I cannot give legal advice, but what I can say is that legalizing your business entity has several benefits, the main one that I find attractive is Protection against lawsuits If someone decides to sue your business, but legally no business actually exists, then they can come at you both as individuals and sue for your individually owned assets including ...


5

There are a few disadvantages to incorporating as an LLC as opposed to going forward as a sole proprietor. More paperwork. Basically, since you'll be an actual company, you'd need to file paperwork with the state. This may differ state to state (since you mentioned the United States). Taxes. Depending on the state, you may need to pay self-employment taxes ...


5

Your question has to do with what a state feels they can regulate, and what other states will recognize regarding regulation. I would recommend discussing this with a lawyer who can look at the specifics and give you real guidance. This is mostly a response aimed at ensuring you get as much from such a meeting as possible. Additionally some of this is ...


5

Even as a single member LLC you must keep finances separate. You must have a bank account for the LLC which is not your personal bank account. Then you can pay yourself (or take dividends) from the LLC funds. But you can not deposit the LLC money into a personal bank account. Well, you aren't supposed to. I guess a bank may allow you to, but legally you ...


4

Edward Brey's comment is pretty much spot as far as liability is concerned. Other than (well put, Edward!) illegal activity, the LLC form protects the owners and operators from incurring personal liability as a result of activities carried out for the business of the LLC. The LLC business entity is a simpler approach than a corporation because it removes ...


4

You are supposed to report all income earned from all sources. Your tax liability will depend on many other factors. I am not a lawyer or an accountant. It will be best to discuss with a tax professional about this. It would probably be best to set up a sole proprietorship company (again, talk to a tax professional, accountant or lawyer about how to do ...


4

IANAL. However according to the IRS you need to file a 1099-MISC if you made any of the following payments File this form for each person to whom you have paid during the year: at least $10 in royalties or broker payments in lieu of dividends or tax-exempt interest; at least $600 in rents, services (including parts and materials), prizes and ...


3

Absolutely. The technical term for doing so is called being a "sole proprietor". "Sole proprietorship" refers to how your business is "organized" as per the IRS. A sole proprietor may use their own name for conducting business, or may register a business name with their municipality if they want. (My town registers business names for two four years for $...


3

Reissuing an invoice should be fine as long as it is clear why the invoice has been reissued. This could be done by annotating the new invoice appropriately such as, "Invoice [number] reissued with amended address" or similar. For obvious reasons it is especially important to be clear about whether the invoice amount has changed or not and whether it needs ...


3

I think it's valuable to add to the other answers that you must be able to prove that your LLC is acting as a business entity in order to have the protection specified. Generally speaking you do this by running it as a real business and not as a shield. (Meaning that, in most cases, you can not simply have an LLC but give it no capital, keep no books, etc......


3

I cant advise regarding taxes, I am no expert in that field (and it will vary depending on the country). But for the other part - I think the client can specify (at least roughly) the price of the guitar (and I presume you play the guitar so you can tell if his price estimate would be what you will be willing to pay for such guitar if you went to the shop ...


3

It seems you're assuming their reason for not hiring you is the fact that you're outside US, but there doesn't seem to be any real evidence to think so. I have been freelancing for a few years and have a few friends doing the same, all of us regularly get awarded projects by US clients and have had generally pleasant experiences with them. If there are ...


3

For anyone that's already been down this road, please offer some specific factors to consider in choosing the right legal business entity in RI for a consulting firm with two options: (1) no anticipated retail sales at all, (2) a small amount of retail sales with most income anticipated to be only from professional services rendered. A quick ...


3

How to learn copyright law.... As a long-term open source software developer, I have to say one never really stops learning copyright law. There are however some very basic things to be aware of. There are even questions which have not been definitively answered, such as whether or when #include <headerfile.h> can ever lead to the copyright holder ...


3

Run, don't walk, to a local certified accountant. You need advice from a professional in this area. Time is running out on your 2014 taxes. The financial penalties can be significant if you have mis-estimated your tax liability.


3

Skype It doesn't matter if you can't have personal meetings with them, clients love to be able to do Skype meetings if you don't mind using it. You simply need to make it very clear that you're opened to chat with them about their projects. If you don't like being on video mode, they're usually alright with a voice chat as well. Currency Value There is ...


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