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How many of you have a legitimately set up business for your side work? I'm employed full time but take on side work when I can to make extra money, and I'll probably only make between 5-10K through side work this year.
Is that worth it for me to set up a legit small side business to help with write offs at tax time?
depends on the country you live in I'd say
Same here stoplying, I work full-time and have a side business. I set-up my side business as a "S Corporation" I write off the following: mobile phone, auto lease, internet, computer, software, office supplies and I also rent out 250 sq. ft. to myself.
What fees do you pay yearly at tax time for your side business? And if you don't mind saying, how much money do you generate from your side biz?
I did and fail,
FWIW, you don't have to setup a LLC or S-Corp (and pay high fees for doing so) for such a small business. In California at least, you're covered by a DBA (doing business as) filing for things like simple writeoffs.
Yes. Same as @organicgrid. Except I don't write my car or phone off...
Did and went shit.
Im as DBA myself but looking to start a new business with trade mark, tax ID and other things to I can start exporting. I'm considering hiring a tax lawyer for this, cause I don't know where to start.
Has anyone used Legalzoom.com for this?
I did my DBA a few years back through a site, it was affordable and pretty simple, they did all the work for me. Legalzoom seems to be more advanced, better designed and offering more options besides the dba thing
You will spend about a grand or so on licensure.
I get around 2 to 5K in sideline work every year. I didnt created a business for this. I live in Kanada. I think its good when you get more than 15K i think.
S Corp is way overkill for your situation (my main biz is an LLC that files as an S Corp). You have to pay payroll taxes (worse, you have to keep track of paying them, which, for me, requires a part time bookkeeper in addition to an accountant), etc.
LLC is worth it, maybe $50 to setup, most states have a simple online way to do it (it really doesn't take more than 30 minutes). You can also DBA under that LLC to cover other businesses you might start.
If you want to have someone set it up for you, as I did for my first LLC, it'll cost you at least a couple hundred. Not necessary, though, that just writes out things, files for you, etc. Since then I've setup a handful of LLC's on govt sites. (if you might be in a high risk to be sued biz, then maybe paying someone is worth it, otherwise overkill for things you can do in a few minutes).
Thanks for the replies. I think I'm going to just fill out a W2 at year end and claim certain expenses that are necessary for the side work. The LLC and S-Corp would definitely be overkill.