What If I Start Making Money BEFORE Opening An LLC?
I've got just about everything I need to get my real estate note brokering business started. I've got my office set up, my business phone number, my mailing list. And my business's new website should be ready in a couple of days.
The only thing I don't have is a business entity set up. Right now I'm simply Doing Business As (DBA) ForwardMotion Marketing. Now I do plan to open my own LLC eventually. But what if I decided I'd like the business to start making money before I set up my LLC? How would that affect my tax situation?
Hypothetical: What if I closed two deals as a sole proprietor, then set up an LLC and closed, say, ten more deals. At the end of the year, for tax purposes, would the LLC absorb all the profits (since the LLC will have been opened in the same year), or would only the ones I closed since the exact date of opening the LLC be taxed as LLC profits?