I was listening to the AJR song “Bang!” and when he sings…
“Feel like I’m gonna puke ’cause my taxes are due”
…I can totally relate. Do you stress the f*$% out at tax time and dread that big check you might have to write?
Many years ago, I learned my lesson that being a sole proprietor wasn’t working for me. I became an LLC (a legal entity at the state level). This means my company has an articles of organization registered in the state of Georgia.
And, after a chat with my CPA, I found a better tax election for my business: the S Corporation (the S Corp status is simply an election you make with the IRS to be taxed as a corporation with an S election).
Why the LLC / S Corporation?
- I’ll never have to write the government a 17k check again.
- I get a W2. I’m an employee of my company.
- It creates separation between the business’s money and my personal money.
- It makes end-of-year taxes easier.
I got rid of something that wasn’t working for me, and found something that was—one of the reasons I love being self-employed! Granted, this does require the help of a payroll company and my CPA, but that’s what I need to stay on top of things just like I need the Creatives Roundtable accountability group to stay accountable.
Learn more about my business structure in my latest blog post: The 17k check that changed my approach to business and taxes.