Help start up

[Barbara C.]

Hi, I'm new to BiggerPockets and have a few startup questions: Do I have to wait until I have an LLC set up before I can actual do any transactions? If so, how do I handle this when I file my 2009 taxes? Also, I suppose I would need to receive my EIN number in order to set up business bank account, for checks to pay bird dogs etc. I know I can apply for it on the government's website for free, and I can type in APPLIED FOR where its needed. However, since it seems to take a long time to get the LLC , name search etc. set up. Should I use my own personal information, and is there a way to legally transfer later to the corp before filing taxes in order to claim tax advantages? I do not want to file as sole proprietor. Another question, I feel that since I do not have the LLC established, any name I choose for my business would not really be legal, how can I use it to set up business, checking accounts, business cards etc? Sorry to ask so many questions. I do not yet have an accountant and hope to do my first deal pretty soon... money is at issue right now. Thank you

[Jon Holdman]

>>Hi, I'm new to BiggerPockets and have a few startup questions: Do I have to wait until I have an LLC set up before I can actual do any transactions?

No.

>> If so, how do I handle this when I file my 2009 taxes?

LLC has no effect on taxes.

>>Also, I suppose I would need to receive my EIN number in order to set up business bank account, for checks to pay bird dogs etc. I know I can apply for it on the government's website for free, and I can type in APPLIED FOR where its needed.

It takes about three minutes online to get a EIN. You'll have it at the end of the three miutes.

>> However, since it seems to take a long time to get the LLC , name search etc. set up.

Here in CO this takes about 5-10 minutes online. Pay your $50, enter the information, and you have your articles of organization five minutes later. You'll spend more time thinking of a name than doing the paperwork. Of course, it varies by state and other states are more expensive and slower.

>> Should I use my own personal information, and is there a way to legally transfer later to the corp before filing taxes in order to claim tax advantages?

You can later turn the LLC into a corporation. Same basic process. C-Corporations do have significant tax implications. S-corporations, like LLCs, are pass through entities and all the income and loss shows up on your personal return. Multi member LLCs and S-corps with multiple shareholders will have to do a partnership return to split out the profit and losses. C-corps have a much more complex tax situation. If you think those apply, related to finge benefits mostly, but that's way oversimplified, have a chat with your CPA.

>> I do not want to file as sole proprietor.

You mean you don't want to run your business as a sole proprietor. For taxes, sole proprietor, LLC and s-corp all end up the same (oversimplified a bit, again, a CPA is essential.)

>>Another question, I feel that since I do not have the LLC established, any name I choose for my business would not really be legal, how can I use it to set up business, checking accounts, business cards etc?

>> If you don't form an LLC or corporation, you would typically file a DBA - Doing Business As to establish your name.

>>Sorry to ask so many questions. I do not yet have an accountant

Get one.

>> and hope to do my first deal pretty soon... money is at issue right now. Thank you

Worry about doing the deal. That's far more important than all this entity stuff.