In today's market environment, opting to establish your home-based business as an LLC can be beneficial. If you think that all it takes to maintain a home-based LLC is filling out the application, then you could be setting yourself up for failure.
Here are three tips that you can use to ensure the success of your home-based LLC in the future.
1. When it comes to finances, keep everything separate.
If your home-based LLC doesn't generate a significant amount of revenue throughout the year, you might be tempted to just combine your business income with your personal income. In order to maintain your LLC's compliance with the law, you must adopt the habit of keeping business and personal finances separate.
Take the time to open a separate bank account that will be dedicated solely to your home-based business. Establish regular paydays for yourself, and only transfer money from your business account to your personal account on these days. By keeping your personal finances separated from your business assets, you make it easier to report to government agencies on the financial health of your LLC.
2. Document any changes by filing articles of amendment.
When your home-based business is very small, it can be easy to overlook the need to document important changes. If you move to a new address or change your company's name in any way, you must make these changes official by filing articles of amendment with your state's government.
Since your state's government views your LLC as a legal entity, you must take the time to maintain communication regarding your business activities with government agencies to ensure you are in compliance with the law. If you are unsure how to go about filing articles of amendment, contact a business attorney like Strauss Troy for assistance.
3. If you stop working your home-based LLC, take the time to officially close it.
Some people stop working their home-based businesses, but fail to officially close the LLC they created. It's essential that you don't let this simple maintenance task go overlooked. When you create a business entity by establishing an LLC, you accept certain liabilities.
Even if you aren't actively pursuing your business, an LLC that isn't dissolved could be subject to government fees or lawsuits. Working with a business lawyer to file the forms needed to officially close your LLC will release you from these liabilities.
Maintaining an LLC doesn't have to be difficult, but you must be vigilant when it comes to finances, amendments, and closures to protect yourself in the future.Share