Home > Business Resource Center > Business Structures - LLC vs. Sole Prop.
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Should you be an LLC (Limited Liability Company) or a
Sole Proprietorship?
Sole Proprietorships are very easy and inexpensive to set
up. As we always say, "you get what you pay for". Sole
Proprietorships generally cost $30-60 and you must
register through the WV State Tax Department. Since the
business doesn't have it's own Social Security number (it
uses your personal Social Security number) the liability is
greater than that of an LLC.
LLC's are pretty simple to set up (although others will tell
you otherwise) and generally cost between $125-150.
There are some tax benefits to being an LLC. You must
register with the WV Secretary of State. You must also
register with the IRS to get a Federal Employer
Identification Number (FEIN) instead of using your personal
social security number, leaving you a little less liable.
Keep in mind that a consumer could still sue you
personally and taxes, workers compensation,
unemployment tax, etc. will not go away if something goes
wrong and you close your business.
You can do a lot of research on your own but I suggest
consulting with an accountant and possibly an attorney if
you have specific questions or concerns.
You can also click on the link in red to learn more.
Sole Proprietorship?
Sole Proprietorships are very easy and inexpensive to set
up. As we always say, "you get what you pay for". Sole
Proprietorships generally cost $30-60 and you must
register through the WV State Tax Department. Since the
business doesn't have it's own Social Security number (it
uses your personal Social Security number) the liability is
greater than that of an LLC.
LLC's are pretty simple to set up (although others will tell
you otherwise) and generally cost between $125-150.
There are some tax benefits to being an LLC. You must
register with the WV Secretary of State. You must also
register with the IRS to get a Federal Employer
Identification Number (FEIN) instead of using your personal
social security number, leaving you a little less liable.
Keep in mind that a consumer could still sue you
personally and taxes, workers compensation,
unemployment tax, etc. will not go away if something goes
wrong and you close your business.
You can do a lot of research on your own but I suggest
consulting with an accountant and possibly an attorney if
you have specific questions or concerns.
You can also click on the link in red to learn more.