LLC and sole proprietorship issues - the Nevada loophole and sole prop benefits

Part 1: The Nevada LLC loophole - I had a new doctor tell me he had heard it was a great idea to startup his chiropractic practice as an LLC in Nevada because that state doesn’t require LLC’s or corporations to pay income tax. Well, it’s probably a great idea if your practice is in Nevada. Otherwise, don’t bother. The tax is apportioned based on profits between the states where you do business. If you don’t do much (or any) business in Nevada, you will have little Nevada profit to not be taxed on. Just do it the right way and set up in the state where you’re actually going to practice.

Part 2: Benefits of sole proprietorship. Here’s an excellent article that gives you some good reasons to set up your chiropractic practice as a sole proprietor (I’m including the link because it’s pretty complex):

http://www.businessknowhow.com/startup/sole-proprietor.htm For more information, read the chapter on Legal Forms of Practice in Planning for Practice Success.