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Level 1
posted May 22, 2024 11:52:08 AM

Sole Proprietor or LLC?

I am a sole proprietor at this time, no employees, and make less than $50,000 gross income most years. I carry Errors and Omissions insurance (I'm in an architectural related field). I keep a separate business bank account and a separate company file on Quickbooks. Would there be any advantage to becoming an LLC given my low income? At what point of income increase (I hope it does), would it be wise to become an LLC?

1 1 7992
1 Replies
Level 15
May 22, 2024 11:57:52 AM

@WDI wrote:

I carry Errors and Omissions insurance (I'm in an architectural related field).

That is a good (and wise) thing. 

 

The only advantage to organizing as an LLC would be liability, but then in some states single-member LLCs do not have more than a modicum of protection (or none at all).

 

You might want to investigate forming a professional services corporation.