Quote:
Originally Posted by WannabeCPA
My wife is thinking of starting up a small snack food retail store in the near future. I've searched this forum for an answer to my questions but haven't found one yet. This store is my wife's plan and dream but as her husband I know that I'll have to put in hours at the store as well as handle almost all of the paperwork. We were planning to set up the business as an LLC with her as the sole owner but my concern is that even though I'll probably be on payroll as an employee, I won't be able to represent the company in official business (ex. tax authorities, city inspectors, etc.). So if an inspector for the city comes to inspect our establishment, I won't be able to talk to them about their concerns. I know I'm much better at this than my wife which is why I ask. Would this be true? I'm not worried about business disputes. Instead of me being an employee I was thinking I should be a part owner of the establishment. Would her having a 75% share of ownership and me a 25% share work? Does anyone have any experience with this?
My second question is how does the income flow through to our tax return. We plan to hire either one or two employees, with my wife and myself the owners. Since we file a joint tax return I'm assuming the net profit of the business would be reported on our schedule C. My wife and myself wouldn't be receiving a paycheck, instead our income would be the net profit of the business. The one or two employees would be deductible business expenses. Is this right? I actually used to do tax returns for LLCs when I used to work for a CPA firm but that was over a decade ago and I can't believe how much I've forgotten  Thanks to anyone able to provide some answers. |
I'm not familiar with HI law (if that is where you are), but you can be appointed an officer or manager of the LLC with authorization to sign, etc., without being an owner.
I realize people don't like to spend money on attorneys, but it is an excellent investment when forming an LLC to get an attorney's advice, as it could cost you a lot more not to.
I can't tell you how many small business LLCs I've seen come in to have attorneys clean up their LLCs because they did it on their own or using Legal Zoom in the first place. Do yourself a favor and just get some legal advice for the formation so that you can do it the most advantageous way for your situation, personally and financially.
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