Should I choose a Sole Proprietorship or LL C to sell items on e Bay I will be the only person involved with the business

Asked over 1 year ago - West Carrollton, OH

After I establish that I'm using a name other than mine so I will need a D B A ? ! Then I will need a Sellers Permit or Vendors License to sell on line . Will I need a E I N where I live or can I just use my social security number to file taxes at the end of the year ? Also should I go through legal zoom or similar or should I find these forms on line . If so where on line should I begin to start a legal business . Thanks !

Attorney answers (5)

  1. Stephen Douglas Gregg

    Contributor Level 11

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    Answered . The purpose of creating a business entity with the state in which you live is to reduce your personal liability if you were to be sued and have a judgment entered against you. The more business you plan on doing, the more change there is that you'll eventually be sued by a customer or supplier.

    As to Legal Zoom, it is probably cheaper in the long run to retain an attorney. Generally, people go to Legal Zoom thinking that they'll save money. But, what usually happens is that they then have to consult an attorney to fix the messes that are created by trying to do it without an attorney in the first place.

    The foregoing does not establish an attorney client relationship with Attorney Stephen D. Gregg. The information... more
  2. C L Huddleston III

    Pro

    Contributor Level 16

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    Answered . Effective March 27, Ohio becomes one of the top 4 or 5 asset protection states in the U S.

    I would definitely create an LLC for your business. Merely creating one is easy, but you will need an Operating Agreement, which is best crafted with the help of your own attorney. Your accountant will most likely tell you to elect "partnership" tax treatment, which allows everything to pass through your entity and be reported on your personal 1040.

    Every business owner should have a go-to business lawyer and CPA, and should lean on them for advice and networking at start-up. Sooner or later something bad will happen and you will be glad you have an existing relationship with your professional advisors.

    I suppose Legal Zoom has its place, but if you engage an expert business lawyer and CPA you will receive value far in excess of what you pay. Good luck.

    Mr. Huddleston is an Ohio-Certified Specialist in Estate Planning, Trust & Probate Law, with offices in Columbus... more
  3. Frank A. Natoli

    Pro

    Contributor Level 20

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    Answered . Hi,

    If this is just a hobby activity then perhaps filing a county DBA and getting a tax cert (EIN) would be fine at least in the beginning. If however you intend on operating as a proper business then you are strongly advised to create a liability shield like an LLC so there is a legal distinction between you and the business and so you would not be personally liable for business debts and other obligations.

    Using Legal Zoom sounds easy enough untill you realize that they are actually no help at all regards to addressing specifc legal questions and frankly when all is said and done I don't think they would be much cheaper than what many lawyers such as myself charge to set up an LLC properly with legal advice and attention. There is also a huge value in building a relationship with an actual lawyer that you contact when you have issues or questions.

    I will link you to some general helpful info below and most of us here, including myself, offer a free phone consult.

    Best regards,
    Frank
    Natoli-Lapin, LLC
    (see Disclaimer)

    The law firm of Natoli-Lapin, LLC (Home of Lantern Legal Services) offers our flat-rate legal services in the... more
  4. Adam Jeffrey Curry

    Contributor Level 6

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    Answered . You can file and create an LLC with the State. The state requires you to use their form when establishing the name and other statutory requirements. This is the Articles of Organization. I think going to the local law library and picking up a law book is a better idea than legal zoom. However, if you are creating a business that will be doing a lot of transactions then you should get a LLC and have an attorney do it. A LLC provides tax benefits similar to a partnership (treated as pass through), but with personal liability protection. It is highly suggested that you create an operating agreement. These are governing documents for your entity. Though, under Ohio law, you are not required to have one.

  5. Christopher Lee Beck

    Pro

    Contributor Level 19

    4

    Lawyers agree

    Answered . I agree with everyone who has posted that an LLC is probably your best bet. I always tell anyone that says they will just use legal zoom to take at least 3 times the cost of legal zoom and put it aside for when they screw up and need me to fix it. Remember it took all the kings horses and kings men to put humpty dumpty back together after he fell when it only would have taken 1 person to tell him to get off the wall the first time. I assist people in business start ups and could assist you in filing for LLC with the secretary of state, filing for your EIN number, and operating agreement. Best estimate would be somewhere around $1000-1500 In attorney fees plus application fees for the secretary of state. Avoiding civil liability is extrememly important.


    Attorney Chris Beck
    Beck Law Office, L.L.C.
    Beavercreek, Ohio
    (937)510-6110 phone
    attycbeck@gmail.com
    www.becklawofficellc.com

    The responses of Attorney Chris Beck to any questions posed on Avvo do NOT establish an Attorney-client... more

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