How To Start An LLC For Lawn Care Business 2023?

If you run a business involving mowing lawns and other lawn care services, then forming a limited liability company (LLC) may be a good move. Doing so could potentially help you save on taxes and will keep your personal assets safe from seizure if the lawn care company ever has challenges.

This article covers everything you need to know about turning your lawn care company into an LLC. Read on to learn how to get started.

What Is An LLC For Lawn Care Business?

A limited liability company (LLC) is one type of business structure that you can use while running a lawn care business. It’s an alternative to holding your company as a sole proprietorship or S corp.

Whether you’re running an LLC or sole proprietorship, every legal business entity has its own pros and cons. The benefits of this legal entity may be just what you need to help your landscaping business thrive long-term. We provide more detailed information about the pros and cons of LLCs for lawn care businesses below.

The Benefits And Drawbacks Of Using An LLC For Lawn Care Business

Benefits

The biggest advantage of running your lawn care business as an LLC is that it keeps your personal and business assets separate. Lawn care companies that form LLCs can go deep into debt and even declare bankruptcy and your personal assets won’t be impacted. This enables you to run your lawn care company as you see fit without having to worry as much about your personal assets being put at risk from bold decisions.

Another big advantage of choosing an LLC for your lawn care company is related to the taxes you pay as a business owner. LLCs avoid double taxation, unlike an S corp. This can help minimize the amount you pay to the government and keep your business accounts strong.

Drawbacks

The main downside to running a limited liability company as opposed to sole proprietorships or an S corp is the costs of setting one up. To get LLC status, you have to meet your state’s licensing requirements. This involves paying a one-time fee of up to several hundred dollars. Most states have ongoing annual reporting fees as well. But the exact amount you pay while starting a lawn care LLC will depend on the state that your landscape professionals are located in and how they charge for business structures.

What Are The Tax Benefits For An LLC Lawn Care Business?

If you form a lawn care LLC, you may be able to save on state and federal taxes. Your lawn care business won’t have to pay corporate taxes. This can keep your business bank account fuller and give you more money to spend on things like advertising through social media accounts.

Your state may also have other benefits related to filing taxes as an LLC, such as paying a reduced rate on self-employment taxes or your tax returns overall. But each state sets its own policies, so you’ll want to research the tax benefits offered by this business structure in your state before moving away from a sole proprietorship or S corp to form your own lawn care business LLC

How To Form An LLC For A Lawn Care Business? Steps By Steps

Now that we know why lawn care businesses may want to form LLCs, let’s take a look at step-by-step instructions for doing so. Here’s what the process of turning your sole proprietorships into LLCs will likely look like, although keep in mind that most states have different licensing requirements from one another.

Research Your State’s Licensing Requirements for Forming a New LLC Business

The first thing you should do is look at your state’s website to figure out what it takes to start a lawn care LLC. Each state will have its own licensing requirements and forms that your business needs to fill out as part of starting a lawn care LLC.

The most essential step in turning your company into an LLC is typically filling out an operating agreement. This includes details like your business name, insurance polices, services offered, who the owner is, and any other additional licenses and insurance policies you may have.

Fill out the Required Forms

Once you know which forms and additional licenses your state requests for would-be LLCs, it will be time to fill those out. Your state may request articles of organization or it may reserve those for a corporation. It depends on your secretary of state’s policies.

If you want to offer more services than mowing a client’s lawn, such as pest control, your company may need to apply for other licenses and insurance policies to do so, just in case property damage occurs. But it will vary based on the national association that oversees your state’s business rules and whether you have an existing contractor’s number for your business or not.

Pay the Filing Fee

The next step is paying whatever filing fee your state charges to businesses that want to become LLCs. The amount of money you have to pay could be under $50 or more than several hundred dollars, depending on the state you’re located in and how its small business administration functions.

You may also want need to set aside money in your business bank account for annual reporting fees. Most states have these in some form or another. You have to pay them every year in order to keep your business license and remain a lawn care company with an LLC.

Provide Additional Information, If Requested

Your lawn care company may not get everything right the first time. If you forget to include something, such as information about business licenses and proof that your lawn care business legal paperwork is in order, the secretary of state may request adjustments to your LLC application.

If so, simply complete the requested steps and your lawn care business legal entity will be an LLC in no time. You may also need to set up an employer identification number and purchase worker’s compensation insurance at this point – especially if your lawn care business hires employees to offer its services. Setting up an employee identification number for general liability insurance could also help you save money and keep your business and its net income thriving while you and your employees continue to serve existing customers.

Top 2 LLC Services

You can form an LLC lawn care business correctly on your own. But there are several benefits to seeking out professional support for your business during this process. If you’re interested in getting some help with the paperwork and insurance details before hiring employees, these two LLC formation companies can help.

ZenBusiness

ZenBusiness is our top overall selection because it’s affordable and offers some of the best after-hours customer support in the industry. It can also be an ongoing form of support for your lawn care business, and can help you make more informed decisions with business license details, business assets, and things like general liability insurance for your employees and lawn care business.

Northwest Registered Agent

Northwest is another solid LLC formation company that can help you turn your lawn care business into an LLC. It also offers support with business licenses and lawn care business legal paperwork, along with commercial auto insurance and business bank account opening guides. It’s slightly less expensive than ZenBusiness but doesn’t quite offer as many services and doesn’t have as broad of customer support hours.

Other Resources for Opening An LLC Lawn Care Business

If you’re interested in lawn care business legal paperwork that will turn it into an LLC, you can find many helpful resources online. A simple Google search will return details about the business license details you need to run a lawn care business as an LLC, your commercial auto insurance requirements, and other details that can help your business thrive.

The two providers we listed above can also be excellent resources. You may consider hiring one to act as your registered agent. Doing so would ensure that you and your employees have the business support you need to help your lawn care business thrive for years to come.

Final Thoughts

Forming an LLC could be just what your lawn care business needs to avoid personal liability and save on taxes. Doing so may also make it easier to get your next business license and expand the company.

You can use this guide as a resource to get started with the LLC formation process. But you may also want to use a professional LLC formation service to make sure you don’t miss any details. Either way, we wish you the best of luck with your company moving forward.

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