Let’s set the stage: You’ve been self-employed for a while, and you’re a pro at doing your small business taxes by now. You hustled and worked hard last year — business has been booming. As you fill out your tax return for the year, you start to realize that Schedule C is looking a bit more crowded than you’re used to. Is it time for a change? Eventually, self-employed taxpayers might find themselves outgrowing their roles as small-scale sole proprietors and decide they’re ready to graduate to something a little more official, like a limited liability company (LLC). But how do you know you’re ready to make the switch? Here are some signs you might be ready to create an LLC and what steps you should take once you’ve decided to make the leap. When to switch from sole proprietor to LLC When thinking about turning your business into an LLC, ask yourself one simple question: Are things getting serious? And by “serious,” we mean: Is your business growing? Are you earning, or do yo...
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