Q: I am interested in starting a computer repair business out of my home. I am looking to limit liability due to the nature
I am interested in starting a computer repair business out of my home. I am looking to limit liability due to the nature of the work and potential data loss. What are my insurance requirements, as well as if I were to hire a small work force 1-10 employees, what are my requirements. I do understand the fundamentals however this is my introduction to either running an LLC or an S Corp. Please advise as to where I should begin. Would advising a professional attorney be required to begin, or can I evaluate many of the steps my self and have my paperwork reviewed by and attorney?
A: The issues are a mix of tax issues and planning for what will happen. Everything is easy to set up, but the choices matter.
Barry E. Janay agrees with this answer
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A:
Insurance requirements: Technically no legal requirement, but pracitcally speaking you should consult with an insurance broker who can advise you on what is commonplace in the industry an what would suit your needs.
Employing individuals: You'll have to withold money from pay to cover taxes, engaging a payroll company is probably a good idea, conducting background checks, having a standard letter of employment and basic employment policy document is also a good idea (especially since the nature of the business will involve handling of data).
Type of Entity LLC vs. Corporation: An LLC provides greater flexibility, for tax purposes consult with a CPA on his advising. I believe you can elect to treat an LLC as a disregarded entity for tax purposes, I'm not so sure that it's the same for a Corporation.
Should you get an attorney? I'm obviously biased, but I think you should. The adage of a stitch in time saving nine is particularly true when it comes to legal matters, if you fail to set things up properly in the outset they can become lingering problems that only grow. It's somewhat of a catch 22, because when you're starting out you also lack the resources to hire a great attorney, I'm sympathetic to that and have pretty reasonable fees for startups such as yourself.
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