Tax Law (Questions About Taxes)/LLC or Corp

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Question
I have a package courier route where I get paid with a 1099 and I am my only employee I have no inventory to claim I only have the labor    I will write off my vehicle expenses and expect to make no more than  $30,000  which is the best way for me to set up  in New Jersey   where the tax paper work is a minimum

Thanks

Answer
Karl,

Thanks for your question.

First, you should know that any business entity you select is not retroactive.  Anything you have done to this point is simply a sole proprietorship, filing a Schedule C as a part of your 1040.

An LLC is the simpler form of organization to set up, as it does not require many of the legal formalities of a corporation.  An LLC is a disregarded entity with respect to the IRS, meaning that you choose how to be taxed.  The default would be as a sole proprietor (or partnership if more than one owner), but you may elect S Corporation or C Corporation.

The most simple approach would be to form an LLC for the liability protection, then file it as a sole proprietorship on Schedule C. To form an LLC you must complete the proper paperwork and submit it to the New Jersey.  This can be done online at https://www.state.nj.us/cgi-bin/treasury/revenue/dcr/filing/page1.cgi.  

In addition, you should apply to the IRS for a Federal tax ID number. This can also be done online at http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Apply-for-an-Empl(EIN)-Online.

Hope this helps.

John Stancil, CPA

Tax Law (Questions About Taxes)

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John Stancil, CPA

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I can answer questions on personal income taxes, partnerships, and some corporate income taxes. I can deal with some state tax questions. Limited gift and estate tax questions. I am also familiar with ministerial and church tax reporting issues. I am Professor Emeritus at Florida Southern College. Sales taxes and property taxes are state and local issues so I am not likely be be able to give you an in depth answer on those types of taxes. I have maintained a CPA practice, specializing in tax, for over 35 years. I am a member of the National Association of Tax Professionals, The Florida Insititute of CPA's, The NCPE Fellowship. In addition I am a Certified Mentor for SCORE. Visit my website at www.mybaldcpa.com. I also offer seminars and consultations to churches and clergy on their tax issues at www.churchtaxsolutions.com Also visit my blog, www.thetaxdocspot.com. I am listed on Tax Connections at https://www.taxconnections.com/profile/John-Stancil/12258973 Prepare and file your own taxes at www.1040stancilcpa.com

Experience

I hold a doctorate in Accounting, and am a CPA. My certifications of CIA, CFM, and CMA are inactive. I passed all certification examinations on the first attempt, and received honorable mention for my scores on the CIA exam. I have operated a CPA firm for over 37 years and have taught accounting and tax at the college level for over 35 years.

Organizations
FICPA, NATP, NCPE Fellowship, Lakeland Business Leaders

Publications
The CPA Journal, Florida CPA Today, Green Consumer, Green Business, Global Sustainability as a Business Imperative, Palmetto Review, NATP TaxPro Quarterly, Mustang Journal of Finance and Accounting.

Education/Credentials
DBA University of Memphis MBA University of Georgia BS in Accounting Mars Hill University

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