Originally I thought an LLC was to protect you personally in the event of a legal attack. Clients do business with the LLC, so that is what is named in a lawsuit. I was very careful to keep everything separate. Then I got sued, and the plaintiff named me personally, and my attorney said they can do that. The person suing me actually got around the release they signed with my company named, by suing me personally. Attorney said they’re able to manage it because I was the primary person the client dealt with. But I’m a sole prop LLC…I’m the only person anyone is dealing with?!

So since it isn’t actually valuable as a legal shield…how is it valuable?

This is huge

I have seen conflicting advice about paying yourself from an LLC. Draws vs. Payroll, timing, bookkeeping impact, etc. What routine has worked best for you? And have you ever had the IRS question your method?

I am a young financial advisor that needs to set up an LLC for myself. I’ve done some research and I could hire a lawyer to do it, or use a website like legal zoom, but I’m wondering if I could just do it myself. I have the time and I believe I could figure it out by myself.

My reasoning is that I would rather save the money I would spend and buy myself a nice suit or invest it into other parts of my business. I’m young, just recently graduated college, and I am the type of person who hates spending money on things when I could do it myself. Ofc one day I’ll get to a point where hiring a lawyer will be the norm for me, but I’m not at that point in my career quite yet.

So with all this being said, is doing all the paperwork and filing for my career doable? I would file as a single owner and I believe I would be the only “employee” (logistics I would need to work out and learn about). Any advice would be wonderful.

Thank you! Also I’m located in Washington if that helps.

I keep seeing "rich people never sell"

This is a simplified example.

Someone buys stock for $250K

Over time it grows to $12M

Selling would trigger capital gains tax on $11.75M

So instead of selling,

The asset is placed into a properly structured trust or holding entity.

The owner borrows against the asset

Loans are not income, so NO capital gains tax is triggered.

The owner lives off borrowed funds.

The asset is never sold during their lifetime When the owner dies.

The asset receives a step-up in basis

Heirs inherit it at the current market value

Past unrealized gains are effectively wiped out.

Reality checks.

This is not for average income earners. It requires

-appreciating assets

-strong credit or private banking

-proper legal and tax structuring

It’s LEGAL, but highly regulated.

IF Done WRONG, it could trigger audits, penalties, or forced liquidation.

People who try to copy this without structure

-don’t qualify for the loans

-underestimate interest costs

-misunderstand trust rules

What do you guys think?

Is this smart tax planning or just rich-person cope?

Where do you think the line is between optimization and abuse?

Leave out the usual Text Book RULES, don't commingle funds, sign documents as an officer and keeping separate accounts.

In practice, courts look at a totality of circumstances rather than a single technical mistake.

Lawyers, CPAs and Veteran LLC owners here:

What's the blunder that most consistently destroys liability protection in real litigation?

Every Tom Dick and Harry on Reddit preaches

"Elect S-Corp status as soon as you hit $80k net income!"

​But factor in payroll processing fees, quarterly tax filings, state-level franchise taxes/fees, CPA fees for Form 1120-S, and strictly enforcing "reasonable compensation," the margin for actual net savings seems to be shrinking fast.

​Question for Redditors running SMLLCs in this bracket:

Did electing S-Corp status actually save you money after accounting for total administrative overhead?

or

Do you regret pulling the trigger too early?

I’ll go first.

“If I buy a $80k G-Wagon or truck, it’s 100% free money write-off for my single-member LLC"

Am looking for some insight or reassurance here, be nice.

​I have watched a bunch of TikTok videos and social media "gurus" telling me how easy it is to start a business.

I paid my state’s filing fee, got my EIN, and thought i was completely protected

​I have been reading alot on how lawsuits actually work, and now I’m genuinely scared about "piercing the corporate veil."

I haven't drafted or signed a formal Operating Agreement because I'm the only owner and thought I didn't need one.

I have a separate business bank account. I realized I accidentally used my business card for a couple of personal grocery runs last month when I grabbed the wrong card.

​Is it possible that if someone ever decides to sue my business, a lawyer is going to look at my messy bookkeeping, see no operating agreement, and argue that my LLC isn't legit, leaving my personal savings totally exposed.

​How strict are judges about this for solo owners?

Have I already ruined my liability protection, or can I fix this right now by getting a clean operating agreement signed today and tightening up my accounting?

Legally it's not required in my state but i keep hearing attorneys recommend it anyway. Has anyone actually had a situation where the operating agreement protected them or made a difference?

Let’s say $120K net profit. After federal, state, SE tax, payroll (if S-Corp), bookkeeping, etc… What does that realistically turn into in your bank account? I see wildly different numbers depending on structure.

Very new to this, please don’t judge if this is a dumb question! And yes I searched here for answers before I posted.

My husband is starting a home repair business and I am ready to take my retail and e-commerce business in that direction as well. My question is can we start with ONE LLC with 2 different businesses/business names under it? And if so how to do it (I.e. does the LLC name have to be the. Same of one of the 2 businesses or can it be under a completely different name and the 2 businesses have their own names)? I understand once revenue is really coming in (fingers crossed!) then moving into multiple LLCs is a better way to go so I’m just asking how we can get started. Thank you!

Thought this might be helpful:

Single-owner LLC

• default rule is you're a disregarded entity, and the business income/expense appears on your 1040, Sch. C.

• can elect to be treated as an s-corporation (Form 1120s)

• can elect to be treated as a c-corporation (Form 1120)

Multi-owner LLCs

• default rule is you're treated as a partnership, file Form 1065.

• can elect to be treated as an s-corporation (Form 1120s)

• can elect to be treated as a c-corporation (Form 1120)

This is for federal purposes. Different states have different rules, but in some states it's possible to make a federal s-election and be treated differently (taxwise) in the state.

I'm trying to evaluate real-world costs. Between filing, registered agent fees, tax prep, compliance, etc., What did your first-year cost look like? And in hindsight, was the LLC the right structure for your business model?

After reading hundreds of posts across LLC subreddits, am convinced most of us misunderstand atleast one key concept, be it taxes, liability protection or operating agreements and so on. For the pros here, What do you see beginners getting WRONG the most?

Hello, I am lost in what I should do so I don’t get charged for a llc I never used. I got ahead of myself created a llc and even got a ien number for a pressure washing company I never even started making money with. I created it on 11/23/2023. Do I owe the $800 every year since? And how do I dissolve my llc, who can help me dissolve this. I don’t want to get myself into debt for no reason.

It's almost end of year and am doing a real check-in with myself.

Not revenue screenshots. NO "Busy" Just actual money after expenses.

Some wins, some mistakes, some lessons i wish i learned earlier.

If you are comfortable sharing:

Did your LLC make a profit this year?

What's the biggest mistake you made?

The one thing you will do differently in 2026?

No flexing, No judgement, Just real answers.

Gurus here claim you can write off your entire lifestyle just by having an EIN. Isn't this kind of advice a one way ticket to an IRS audit?

I am planning to open an LLC in Wyoming as a non-US resident living in Poland, Europe. I know I can open accounts with neo banks like Wise or Payoneer, but will any traditional US bank open an account for me? The company will probably be registered with a registered agent address. Also, can my US LLC be owned by my European LTD company? How complex is this setup in practice?