Contract Climbers LLC, S Corp, or Sole proprietor? Why?

Flex Abednego

Well-Known Member
For those of you who have a state contractors license bonded and insured and contract climb, are you registered as LLC, S Corp, or Sole proprietor? Reason for your choice?
Temporarily in urban SoCal (up to a yr) and not interested in working for a single company
 

RBJtree

Well-Known Member
I don't contract climb, but if I did, I would go llc. That's what my business is now. As a sole proprietor, which I used to be, if something bad happens, it goes back straight to you because you and your business are not separate legal entities. As an llc, if you are setup right, your personal property and ability to make a living should be untouchable.
An s corp is too complicated for a single person entity in my opinion, too many rules, and not much benifit. But I am no expert on s corps, maybe someone else knows better.
 

Flex Abednego

Well-Known Member
Uhoh. A wild mountain man loose in the big city. Looking forward to the tales. Hey Nic, hope it’s all going your way.
Not exactly loose... came to be close to the family while momma does ASL interpreters program. Just got burned on a gas dryer I bought on Craigslist, already not liking this place. Seems like the few contractor schools I’ve talked to can do the whole thing for around 1,500$
 

treewill

Active Member
LLC is the obvious choice if you want to go the standard contract climber route. Minimal paperwork but protects you from liabilities you’d have as a sole proprietor. Then if you want to get more professional, look at creating a subcontractor agreement doc to sign with the folks who hire you.

And make sure to get a good insurance agent; you will need them to do stuff for you like getting additional insured documents last minute when a client requests it the night before a job. Not that that’s ever happened to me ;)
 

Flex Abednego

Well-Known Member
Seems like a consensus so far. The contractor school I spoke the most with really seemed to prefer the s Corp for some reason, I’m guessing it makes them more $$
 

Merle Nelson

Well-Known Member
Lawyers and Accountants - professionals, are great. What's incredible about asking non professionals questions is you can get perspective from those with something at stake similar to you - you can then be more informed to tell your "professionals" what target to aim for.

Good to see your post Nick.
 

samsquatch

Active Member
This is a question for your lawyer and your accountant. Everybody’s got an opinion but you need professional advice.
Disagree. I formed my LLC without either. Paperwork ain't that difficult.. as long as you don't have your head in your ass. And if you do, a lawyer and an accountant won't help with that.

I look at those professionals the same way I do my mechanic. If I can do it, why pay someone else to do it? Because my time is super-uber-valuable? Get real. I'm one of the rare types that doesn't overvalue "my time".
 

owScott

Well-Known Member
I don't contract climb, but if I did, I would go llc. That's what my business is now. As a sole proprietor, which I used to be, if something bad happens, it goes back straight to you because you and your business are not separate legal entities. As an llc, if you are setup right, your personal property and ability to make a living should be untouchable.
An s corp is too complicated for a single person entity in my opinion, too many rules, and not much benifit. But I am no expert on s corps, maybe someone else knows better.[/QUOTE
I just think asking an arborist for legal advice is kind of weird. Kind of like asking my mechanic for his medical opinion.
I just think asking an arborist for legal advice is kind of weird. Kind of like asking my mechanic for his medical opinion.
Unless your mechanic has a medical condition that you face also. Arborist ask other arborist about trucks,chippers and saws when that other person isn't a mechanic. These are basic business questions most business owners should understand. Asking someone with a shared experience doesn't seem weird to me. A good CPA can explain it pretty quickly and you will need a CPA to do your taxes anyway, which can get complicated. A lawyer is a bit overkill. Sorry again for screwing up my reply, definitely don't ask my opinion on how to work a computer
 

RBJtree

Well-Known Member
In my state, in order to incorporate, you must have a lawyer do the filing. At least thats what my lawyer says. I don't know if it's the same in other places.
 

owScott

Well-Known Member
LLC , limited liability company is different from a corporation but the premise is the same. A separate entity that creates liability protection. A corporation is much more complicated and for most tree services would be unnecessary. A LLC is easy to set up. Here in CO it takes about a 1/2 hour on the secretary of states website. May be different in other states.
 

KWolt

Member
An accountants job is to save you money- period.
A lawyers job is to save your ass- period.
I just got two different pieces of business related advice from my accountant and my attorney.
An accountant’s desire to save you money can cloud his advice on how to save your ass through incorporation of your business.
The reason I recommended a lawyer is because the conversation turned to liability issues.
If the concern is more financial then I think discussing this with an accountant is sufficient.
And even though you can do your taxes yourself, a good accountant should save you as much as they cost you. The tax code is too complicated for us to know every possible angle.
 

Steve Connally

Well-Known Member
LLC filing as an S corp. A good CPA can explain it better.
Totally agree. Went this route. Super easy and just a few additional papers to fill out. What this does is reduces your tax liability, lets you not pay SS, allows you to take untaxed distributions after you pay yourself reasonable wages according to the irs scale, and a percentage of income isn't taxed at all. It's kick ass unless you're counting on social security to live on someday. I've already paid in all my quarters. I also have a private retirement/pension so SS is gonna reduce my benefit a percentage based on me already getting a pension. SO basically I won't get crap and now I don't may them crap.
 
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