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How many drivers have set up an LLC?

These deductions are only available if you set up an LLC (plus many more). There is often confusion because you can set up and LLC and then file as a "Sole Proprietor under the LLC". Which is very different than a Standard Sole Proprietor which requires no paperwork at all. We set many of our drivers up with the LLC and then give a breakdown of expenses to make sure that they maximize all of the possible deductions.
 

911 Guy

Well-Known Member
These deductions are only available if you set up an LLC (plus many more). There is often confusion because you can set up and LLC and then file as a "Sole Proprietor under the LLC". Which is very different than a Standard Sole Proprietor which requires no paperwork at all. We set many of our drivers up with the LLC and then give a breakdown of expenses to make sure that they maximize all of the possible deductions.
There is not a single deduction available to LLC that isn't available to the IC. Tax deduction is the same regardless of legal status.
 

Disgusted Driver

Well-Known Member
These deductions are only available if you set up an LLC (plus many more). There is often confusion because you can set up and LLC and then file as a "Sole Proprietor under the LLC". Which is very different than a Standard Sole Proprietor which requires no paperwork at all. We set many of our drivers up with the LLC and then give a breakdown of expenses to make sure that they maximize all of the possible deductions.
I have an LLC and it's sad to see you putting out such inaccurate information that is so self serving.
 
Hi All, Sorry for any confusion, I only joined this forum because the drivers I help asked me too because of the benefits. For example the standard deductions can be the same (i.e phone, cable, internet etc.) However, Business development (taking your wife to dinner but talking about your day at work is actually a corporate write off), or Marketing ( joining a fantasy football league but you talk about your driving is actually a corporate write off). Simply Google "LLC Benefits Uber Driver" you will see many articles written on the subject. And if you already have an LLC, please look into it further. I am an expert in LLC formations and their benefits, and many, many, many people use deductions but don't look at "Corporate Write Offs". LLC's were created by the States for big corporations looking to have more "flexibility" with their taxes and encourage Corporations to file in that State (Delaware is the most known example). I am simply helping people like you all benefit from those corporate benefits. Good Luck to all.
 

Stevie The magic Unicorn

Well-Known Member
It's not as important for a driving job as it would be for literally anything else.

99.9999999999% of what you could ever get sued over is covered by commercial auto insurance.
 

UberLAguy

Active Member
In California the cost to have an LLC is $800 a year. I have been thinking about using them simply because of protection. Read somewhere that it's very dangerous to drive without something like that. It's costly in CA.
 

Disgusted Driver

Well-Known Member
In California the cost to have an LLC is $800 a year. I have been thinking about using them simply because of protection. Read somewhere that it's very dangerous to drive without something like that. It's costly in CA.
Wow, that's a lot. In NC it's $125 a year. Much easier to justify.
 
I set a lot of Uber drivers up with LLCs and it helps for liability and taxes. I usually set my drivers up with ADP at the same time that way they get paychecks etc (on only the income they choose to declare). Cost vary and California is one of the most costly, however you can form in Delaware $360 and still operate in CA. Good Luck!
 

UberLAguy

Active Member
But Nevada corporation will need to pay California tax and $800 a year for operating license if operated mainly in California, correct ?
 

UberTaxPro

Well-Known Member
Past Sponsor
Hi All, Sorry for any confusion, I only joined this forum because the drivers I help asked me too because of the benefits. For example the standard deductions can be the same (i.e phone, cable, internet etc.) However, Business development (taking your wife to dinner but talking about your day at work is actually a corporate write off), or Marketing ( joining a fantasy football league but you talk about your driving is actually a corporate write off). Simply Google "LLC Benefits Uber Driver" you will see many articles written on the subject. And if you already have an LLC, please look into it further. I am an expert in LLC formations and their benefits, and many, many, many people use deductions but don't look at "Corporate Write Offs". LLC's were created by the States for big corporations looking to have more "flexibility" with their taxes and encourage Corporations to file in that State (Delaware is the most known example). I am simply helping people like you all benefit from those corporate benefits. Good Luck to all.
"However, Business development (taking your wife to dinner but talking about your day at work is actually a corporate write off) " Your tax advice here is suspect, even before the recent changes in the law!
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I set a lot of Uber drivers up with LLCs and it helps for liability and taxes. I usually set my drivers up with ADP at the same time that way they get paychecks etc (on only the income they choose to declare). Cost vary and California is one of the most costly, however you can form in Delaware $360 and still operate in CA. Good Luck!
Seriously? Your drivers must be making a lot more than most drivers on here! Out of state LLC's still have to pay the annual $800 LLC tax and other fees in CA right?
 
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peteyvavs

Well-Known Member
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.
It’s much easier and better to just get a sugar momma 😂
 

observer

Well-Known Member
Moderator
I set a lot of Uber drivers up with LLCs and it helps for liability and taxes. I usually set my drivers up with ADP at the same time that way they get paychecks etc (on only the income they choose to declare). Cost vary and California is one of the most costly, however you can form in Delaware $360 and still operate in CA. Good Luck!
In case of an accident where the uber driver is involved, an LLC does not help AT ALL with liability.

An LLC does provide liability in the case of a driver that is an employee of a company as long as the driver isn't also the owner of the LLC.

In case of an accident the other party will sue your LLC , YOU the driver and john does 1-100.

YOU will have to hire a lawyer to defend YOU and YOUR LLC.

YOU WILL BE SUED PERSONALLY.

The only thing that covers liability is the proper insurance in the proper amount.

LLCs DO NOT PROVIDE LIABILITY COVERAGE.
 

observer

Well-Known Member
Moderator
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Null

Well-Known Member
LLC, S-Corp, etc. doesn't do anything for us in TNC regarding liability for most torts. Pax injuries, damaged vehicle, injured pedestrian, etc. don't provide any liability protection at all. The only legal protection it affords is for things like contracts. For example, if U/L sued you for some reason related to a breach of contract, it could protect your personal assets. However, even this would only apply if U/L had the business with your S-Corp/LLC, instead of 'you.'

There is a downside to entity formation as well. With all the lawsuits of Independent Contractor vs Employee, the formation may preclude, or at the very least greatly complicate, your ability to claim on various class actions, or seek redress from various state agencies for things like wage, unemployment, etc. claims.

There was only 1 real circumstance I could think of that the S-Corp was advantageous. With the S-Corp you become a shareholder, executive, and employee. You pay yourself payroll, you pay employment taxes, but you can also pay distributions, etc. You could reimburse yourself as an employee $0.58/mi direct from the company (for 2019). This is INCOME TAX FREE to you as an employee, as the tax code doesn't consider this enrichment, even though your actual vehicle expenses are likely less than $.58/mi. However, the expense IS deductible to the company, since it represents cash out, to pay an employee for company use of their personal vehicle. Since S-Corps have all losses and profits flow-through to the shareholders, this means you effectively get to extract $.58/mi out of the company, untaxed AND still take the deduction for the same expense.

However, you're then having to pay for payroll services, employment taxes, state based fees for entities ($800 min FTB in CA!!!!), etc. Given the number of lawsuits U/L are, and will, face, and the increased accounting overhead, etc. I opted to operate as a sole-prop when I was reviewing this for TNC.
 

observer

Well-Known Member
Moderator
LLCs are designed to protect investors from liabilities.

For instance, at one time, I owned a vehicle transport business with my brothers Manny, Moe and Jack.

My brother Jack occasionally drove one of the trucks, if he would have been involved in an accident he personally would have been liable.

My brothers Manny, Moe and myself as investors and not drivers would have been protected.

We also had several employee drivers that worked for us.

Over the years, as a course of doing business, our employee drivers were involved in several accidents.

Our employee drivers, Curly and Larry were each involved in an accident. Curly, Larry and our LLC were sued by Larry H. Parker (of Larry H. Parker got me 2.1 million dollars fame). Since none of us brothers were driving our assets were protected. I kinda remember actually being sued by LHP three times, so there may have also been an employee driver named Shemp.

In the end, our million dollar insurance policy (required, by the state of California) paid for the lawsuits. No they didn't get 2.1 million dollars, I seem to remember the settlements were in the 50K dollar range.
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(The names of my brothers and employees may or may not have been fictitious and changed to protect the innocent and not so innocent. Larry H. Parker is a pretty famous local Socal attorney).
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I think we may have paid for the door knob on his front door...
 
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