Not everyone is aware that they can establish a legal entity, i.e. a corporation or LLC, for example, in order to write off all of their business expenses and save a lot of money at the end of the year.
An LLC is pretty easy in just about any state. Just visit your Secretary of State online and they usually have a form you can fill out and file online. You can either complete it online or download it and upload it, depending on their requirements, but it usually is not difficult to figure out. There is a filing fee, however, and you will have to file something annually to ensure that they have all your current information, but these fees are also writeoffs at the end of the year.
You can also complete and submit an SS4 form online to the IRS to obtain your Taxpayer Identification Number or EIN. This form will get your tax identification number assigned to your LLC or corporation or whichever route you go, so you can open a bank account in the name of the business entity you established. (Once you begin generating income through this business, you should also open a business savings account and transfer 30% into that account for tax purposes… just in case your writeoffs don’t cover all of your taxes, and you won’t know until the time of filing.)
What is Corporate Freedom?
Once you establish a legal entity, whether it’s a corporation or an LLC (or ?), and secure a tax identification number for this business, you can establish credit under your business. Click on the link to have business credit established for you, whether by way of a business line of credit, or an 80 Paydex score, or both.
Most people say that you can establish credit under the business that is completely separate and apart from your own credit, but you need to be aware that a lot of credit issuers do look at your credit before issuing business credit …so you need to also be working on your own personal credit scores while building business credit.
The best part about business credit is it does not report on your personal credit profile.
What does this mean? It means you can diversify, spread out, your creditworthiness. Some credit issuers may look at your credit and judge you and say you can only have 1 car, for example. I was livid when someone told me that. What gives them the right to tell me what I can afford? Anyway, you can establish credit and finance/lease automobiles and business equipment under your legal entity completely separate from you.
The way I would recommend starting is from the bottom up. Corporate Freedom will build your business credit for you, and make it easy based on where you are to know where you can apply and expand. Once you get to where you have some business credit under your belt, you can apply for business loans, and Corporate Freedom makes it simple, which is why I highly recommend it.