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What are the actual risks of operating as a sole proprietorship vs forming an LLC?
I've been freelancing as a sole proprietor for 2 years now. My income is growing and I'm starting to worry about liability. A client threatened to sue me last month (over a disagreement, nothing serious) and it made me realize my house could be at risk. What exactly am I exposing myself to by not having an LLC? Is it really that bad?
Related Questions
Starting my first online business — should I go with sole proprietorship or single-member LLC?
I'm a freelance web developer based in Germany and I want to start selling SaaS products to US customers. I'm trying to figure out the simplest business structure. A sole proprietorship seems easiest but I keep reading that an LLC is better. What are the actual differences in terms of taxes and liability? I don't want to overcomplicate things if I'm just getting started.
How does LLC taxation actually work? Does the LLC pay taxes or do I pay taxes personally?
I just formed a multi-member LLC with my business partner and we're confused about how taxes work. Our accountant mentioned 'pass-through taxation' but I don't fully understand. Does our LLC file its own tax return? Do we each file separately? Can someone explain LLC taxes in simple terms?
What is the difference between a general partnership and limited partnership for taxes?
My cousin and I are starting a real estate investment project and we're debating between a general partnership and a limited partnership. I know the liability is different, but how does the taxation work? Does a GP and LP pay different taxes? We want to minimize our tax burden and protect our assets.
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