Incorporating my Blog | Bloggers Lair | Yakezie Forums

Thank you for the info Eric! I was wondering what the benefits were aside from protecting your personal assets.

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Eric J. Nisall said:

No problem at all, Justin.  I just want to tell you that you may want to reconsider once you start making enough money to warrant a salary.  As a Sched C filer, everything you net is subject to self-employment taxes, but when you elect S-Corp filing status, you get to take a salary and only that part is subject to payroll taxes.  The net income of an S-Corp is considered a distribution and is never included in the self-employment tax calculation.  Depending on how much you start to make, the savings can be quite considerable. Something to keep in mind, huh? 

 

This goes for anyone who is still filing a Sched C and making pretty serious money, maybe say $50k net.  Taking a salary to save money on SE taxes and not having to worry about filing estimated taxes can probably help out a lot once you reach that point in the blog's life.

My blog is in an LLC, but just a note that forming an LLC and "incorporating" (as in forming a corporation) are not the same thing. An LLC is considered a disregarded entity by the federal government, and the taxes are passed through to the members. A corporation is a separate legal entity.

You'll read a lot of places about LLCs being good because they protect
your personal assets, etc. From what I have read though, if you are a blogger and your
business is blogging in a way that you are essentially the business, it
is likely going to be very easy to "pierce the veil" of the LLC and go
ahead and say you are personally liable. For liability reasons, insurance is often a good idea. And definitely keep business and personal finances separate, as Everything Finance mentioned.

I would talk to a professional if you want to make sure you're in good shape, but as I understand it in general anyone can be sued, and if your LLC isn't clearly separate from you it would probably not provide protection. My insurance is a bit different since I also essentially sell software, but I would look into liability or maybe an umbrella policy.

Forest Parks said:

I definitely need to look into liability insurance. I'm in England so no idea how it works but when I freelanced as a designer I had liability insurance incase I got a copyright suit or similar against me so it can't be that different.

At least you guys have the "English rule" (loser pays system) for the courts.  In the US, each party pays their own.  Makes it easy to make the courts a money contest.  Total joke, really.  /rant