Is starting an LLC recommended if you're working from home?

by Jackie
(Mo)

If your company is going to be home-based is an LLC recommended?

Answer

Yes, I would recommend the LLC for home-based businesses.

The limited liability company is one of the simplest business entities to operate in terms of administration while still maintaining limited liability protection for your personal assets.

For people working from home, forming a single member LLC with yourself as sole member can give you the advantages of incorporation without adding much of an administrative burden.

Corporations--both C and sub-S--require far more ongoing paperwork to maintain than an LLC.

You can create a very streamlined LLC for a home-based business by:

1. Form a single member LLC;
2. Act as your own registered agent;
3. Apply as a disregarded entity with the IRS.

Your ongoing paperwork burden will increase very little from being a sole proprietor.