I saw this tiktok ad of this content creator saying she didn’t know how to make an llc but she found a company that did it for her and she was promoting the company and saying how anyone can get one. But why? and what is it?
In: Economics
An LLC is an extremely easy to set up business entity. There are multiple “kinds” of businesses which are suited for different needs/ownership groups but LLC’s are extremely popular for the perceived easy use and their official sounding name.
Having a business entity is necessary to do things like pay taxes on your businesses’ earnings and to keep business assets seperate from personal assets. A lot of people who become social media content creators don’t necessarily realize that they are in fact running a business and there are different legal and tax implications.
However there is ***a ton*** of misinformation out there on the benefits of having an LLC especially when it comes to taxes and protecting your assets. If you aren’t running your business “like a real business” and are instead just using it as a pass-through to commit tax evasion or to try to not get sued (which is what a lot of these companies that set them up and social media guru’s tell you to do) it’s relatively easy to get popped for tax evasion or to get sued as there are mechanisms in place to combat this kind of loophole.
So in other words, unless you have a bona fide, actual business there are relatively few legitimate reasons to get an LLC.
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