Finance · Legal

How tricky is for a sole owner to manage tax returns and file reports for WY LLC?

Matiss Founding angel, Picoff Ventures, picoff.com

August 28th, 2017

Is the tax code and general governing principles really that different from ones governing European LLCs? Granted, there are differences, but record keeping requirements, "paper trail everywhere" should follow roughly the same pattern in US, right? Or am I being naive? Is it worth the effort or finding someone who actually knows what they are doing a better option?

Paul Garcia President at TABLE

September 1st, 2017

Filing your own returns in the USA as a sole proprietor is typically pretty easy in relative terms. From the broad perspective you're typically seen as a disregarded entity, and sole proprietors file their business income on their PERSONAL taxes on Schedule C. And that's typically about all that is required. Your state may have some business forms, but not every state treats sole proprietorships the same way. The tax office in your state typically offers free help if you make an appointment to visit them, just don't wait until the last minute. You can less expensively do your own taxes and have a tax preparer "review" your documents instead of generate your documents. This is usually several hundred dollars cheaper than having a professional preparer do everything.


If your LLC is your sole source of income, you may need to be filing quarterly estimated payments (after the first year). Typically the IRS will tell you what schedule to follow based on your first annual filing that includes your business. If you use some accounting software like QuickBooks or PeachTree or something similar, you can usually add the module that allows the package to prepare your annual forms for a small fee.

Josh Aguirre

September 1st, 2017

Hey Matiss, thanks for your question. I'm not an attorney or accountant but I do have some experience in this area. I would say that the record-keeping reqs are roughly the same and I don't think that you need to hire an accountant/attorney as long as you research thoroughly.


That being said, there are a number of reasons to get an attorney such as loopholes where you may get audited and/or sued, failure to stipulate certain conditions in your governing documents, etc. Here's a resource that may be helpful.


It really depends on all the facets of your business but I would advise to take it one step at a time. If I can be of any further help, I set up a website to answer questions just like this over here: Invenst and it's free to use (for a limited time) for business owners/inventors & freelancers looking for work. Hope I was of some help ;)


Cheers!


josh@invenst.com

Joseph Wang Chief Science Officer at Bitquant Research Laboratories

September 23rd, 2017

It's not hard and there are some easy reference books in Amazon. It's a matter of how much money did you make, how much money did you spend, here is how much you owe. Fill out these forms and send the tax people the money. The big difference I can think of is that the US doesn't have VAT which makes your life easier.


The one big issue that can trip you up is since you mentioned a European LLC, if there are any international tax issues, then things can get very messy, very quickly.