David C. Jones, CPA
said 8 months, 1 week ago:
Hi I am new to the Social Media experience & trying to learn & gobble up as much info as possible. Also, I have been a practicing CPA since the mid 90′s so maybe we can scratch each others back. To answer the question in your post I wouldn’t do either an LLC or Corporation wait & see were the business goes. LLC’s & Corps in general just protect you personally. Ex: If someone were to file a law suit against your corp they can’t touch your personal assets. As of now & with your line of business, I doubt your exposure to lawsuits are very big.
You will have to keep track of your income & expenses & file a Schedule C with your 1040 when you file your 2012 taxes.
BEWARE of self employment tax it always trips up new business owners. It is Social Security & Medicare Tax that would show on your W-2 & your employer has to match it. You are now self employed and it will basically cost you 13.3% of your net profit (not gross income) above & beyond your normal tax rate.
There are some tax advantages of different types of business entities that I can get into more depth if you want to contact me (513-607-4686) but I don’t see to much at risk or to many tax advantages from the way your post described your business just concentrate on growing & if you do start getting into a full-time status with several clients etc then you may want to talk to a CPA in your area