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How many drivers have set up an LLC?

MadTownUberD

The Trendy Transporter
Moderator
I did, about 10 years ago, long before I started with Uber. I honestly can't remember how much it cost. I use the EIN, and have a separate bank account for the LLC which Uber earnings are direct deposited into, but because it's a "sole proprietor" type LLC there is literally no difference between that and the income I earn at my day job. I'm really not sure what the advantage is other than to have a separate legal entity.
 

oldfart

Well-Known Member
I did, about 10 years ago, long before I started with Uber. I honestly can't remember how much it cost. I use the EIN, and have a separate bank account for the LLC which Uber earnings are direct deposited into, but because it's a "sole proprietor" type LLC there is literally no difference between that and the income I earn at my day job. I'm really not sure what the advantage is other than to have a separate legal entity.
A separate legal entity offers some liability protection
 

Danny3xd

Well-Known Member
Moderator
I set my LLC up in CT, Vet. It cost $250 or $280. I forget.

In my case and if this were my only liability, I don't think I would have.

Edit; I'd find out what it would cost if you did it your self. Not saying anything. Just saying.

But would look into it. Whats he charging you, etc.

Edit after edit;

Great question BTW. Got me looking. Mostly just curious. Also when I got mine, I checked a couple of boxes, wrote down my and Carol's name and handed the nice lady my credit card. Not suggesting that in any way, shape or form. Just sayin'

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Vet, this is interesting.

https://blog.corpnet.com/do-uber-drivers-need-an-llc/ "However, realize that Uber drivers’ personal assets might still be at risk if they are found guilty of personal wrong-doing or negligence."

https://uberpeople.net/threads/pros-and-cons-to-setting-up-llc.196205/

https://mollaeilaw.com/blog/llc-uber-driver/

https://therideshareguy.com/day-1-should-you-form-an-llc-for-your-new-rideshare-business/
 

Disgusted Driver

Well-Known Member
Try legalzoom and you want to make sure you do a subchapter s Corp. That's an LLC where the earnings flow directly to you without corporate tax.
 

MadTownUberD

The Trendy Transporter
Moderator
I've never had to pay taxes for cutting myself a check. I basically called deposits paid in capital and when I write a check to myself it's called a disbursement. the LLC Bank account basically pays for car payments, maintenance, repairs, Etc. But I only claim $0.54 a mile since the car mostly exists to get me to and from my day job. So basically it's a business with the purpose of funding my personal transportation.

A separate legal entity offers some liability protection
So if I understand this correctly the chief benefit is if I get sued the plaintiff can only go after the assets held by the LLC and not my house, my car, Etc. My car is in my name not the llc's name.
 

Danny3xd

Well-Known Member
Moderator
I've never had to pay taxes for cutting myself a check. I basically called deposits paid in capital and when I write a check to myself it's called a disbursement. the LLC Bank account basically pays for car payments, maintenance, repairs, Etc. But I only claim $0.54 a mile since the car mostly exists to get me to and from my day job. So basically it's a business with the purpose of funding my personal transportation.



So if I understand this correctly the chief benefit is if I get sued the plaintiff can only go after the assets held by the LLC and not my house, my car, Etc. My car is in my name not the llc's name.
There's caveats, MadTown. If your found negligent in some way, they can go after you personally. Like you had a broken windshield or seat belt causing harm. Then you can be personally libel.

But it is a wall opposing council would have to cross. It's a protection but not bullet proof. And with so many variables.

With mine, I put every thing I can under that umbrella. Really depends on what you have. If a lot, I would spend the money and ask a pro.

LoL. Oddly enough, it's complicated and varies greatly depending on your situation and location.

Just my 2 cents and please, with a little salt.
 
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Seamus

Well-Known Member
I set up an LLC in NY for about $400 two years ago. I do other "side" things besides Uber/Lyft and one of those other things caused me to set it up under a business name.

Same as MadTownUberD TNC uses my EIN instead of ss# and have a business bank account set up and ride share pay is deposited directly into it.

When set up as a Sole Proprietor (which 90% are) there is literally no tax advantage. Schedule C is the same as if you weren't an LLC.

Liability protection is minimal. I say that because for any lawsuits against you to be significantly damaging, you need the "N" word (negligence) proven. An LLC single proprietor company will not protect the owner from "wrong doing" or "negligence", but will for other types of business issues that may arise.

Also, LLC and S or C corp don 't really protect you if you borrow money in the business name. Any lending institution is going to make the small business owner "personally" guarantee repayment no matter how the company is structured.

All in all even though the benefits are minimal I would do it. Its another hurdle for people to jump thru who want to do you harm. Also, once it is set up you have it and it can be useful for other future endeavors you may want to do.

Good Luck.
 
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Disgusted Driver

Well-Known Member
I've always wondered about them, DD. Any good?

Ya got me curious and looked for reviews. Found one with a list of options; https://bestllcservices.com/legalzoom-llc-services-review/

I know nothing about any of them but it would be great if they work well.
I've set up 2 llc's in the past with them and never had a problem. Do it in advance and take the cheaper option. Legalzoom is great for any straightforward situation and my LLC was. It provides me with a layer of protection because I do have assets, is minimal cost per year with turbo tax and allows for more deductions and flexibility.
 

Danny3xd

Well-Known Member
Moderator
I've set up 2 llc's in the past with them and never had a problem. Do it in advance and take the cheaper option. Legalzoom is great for any straightforward situation and my LLC was. It provides me with a layer of protection because I do have assets, is minimal cost per year with turbo tax and allows for more deductions and flexibility.
Thanks, DD.

When I set mine up, not a clue what the 2 boxes I checked meant. I think I may have actually incured liability and need to look into it. I am making an offer on a rental property soon. So actually have, or hope to have something to lose.

As I once said to an angry customer. "GO AHEAD AND SUE ME! I own a cat, a car, a cat named Fred and a POS bent Stanly screw driver. Have at it!"

Snork. Never heard from him again. And I still have that bent POS Stanly screw driver.
 

Disgusted Driver

Well-Known Member
Thanks, DD.

When I set mine up, not a clue what the 2 boxes I checked meant. I think I may have actually incured liability and need to look into it. I am making an offer on a rental property soon. So actually have, or hope to have something to lose.

As I once said to an angry customer. "GO AHEAD AND SUE ME! I own a cat, a car, a cat named Fred and a POS bent Stanly screw driver. Have at it!"

Snork. Never heard from him again. And I still have that bent POS Stanly screw driver.
Good for you, hope you get it! Passive income is the only way to really make more, there is only so much of our time.

Make sure you are subchapter s or you have to pay corporate tax as well :eek:

I have insurance with USAA and they provide a professional liability rider that covers me for 1 million bucks and the premium is about 30 a year. So whenever someone threatens to sue I've told them go ahead, I won't even hire an attorney but my insurance company will represent me so it won't cost me a dime.
 

FLKeys

Well-Known Member
Keep in mind in some states you may not have to pay state income tax on your rideshare earnings, however forming a corporation or LLC may require you to file state income tax returns. Florida comes to mind here.
 

oldfart

Well-Known Member
LLC offers great protection for the driver as well as an amazing tax benefits. The real gift is when you act like a company and there are a lot more expenses than just gas and miles. It takes a cell phone, internet, business development to run a LLC :smiles: etc. These are all tax deductible if you have an LLC versus just being a Sole Proprietor or nothing at all. Check out Watkins Consulting Biz, we set up LLC's for Uber drivers frequently and can make sure you are 1.) and LLC and 2.) maximizing the LLC for all you can.

all those deductions are available to you whether an LLC or Sole Proprietor ..
 
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