There are very legitimate reasons for starting your Limited Liability Company (LLC) on January 1st… but the time to file is NOW!
You don’t want to wait until December 15, 2022 to file for a start date of January 1, 2023 like every other ‘uninformed’ person out there.
“But what difference does it make whether I start my new company on January 1st, instead of any other month of the year,” you ask?
Good question. Actually, there are many good reasons to start your company at the first of the year… and also why it’s a MUST to file early to beat the rush. Check out the LLC University for more detailed information.
Let’s first take a look at ALL the advantages of starting your new business on January 1st – then we’ll look at why you should file early.
Advantages of Starting Your LLC on January 1st, 2023
Streamline Tax Filing and Bookkeeping
Forming an LLC with a January start date offers you a clean slate when it comes to bookkeeping and taxes. Your company can start earning revenue and tracking expenses in the new year, instead of hassling with the few months in the previous year also.
Plus, your first tax returns generally aren't due until the year following your entity's formation. So when you choose a January start date, you have more than a year to prepare and file your company's taxes.
Conversely, if you form your entity in the latter part of the year, for example, your company's tax return would be due within just a few months.
Simplify Administrative Compliance
LLCs have to adhere to a number of administrative formalities in order to remain in compliance with state law – and to maintain the personal liability protection offered by the entity structure.
If you fail to adhere to such formalities, a court could remove the protective barrier that shields your personal assets, known as “piercing the veil.” This action would leave you personally liable to creditors in the event of a judgment.
Formalities may vary, from state to state, but some of the most common requirements typically include filing an annual report and paying filing fees.
And in most states, annual reports are (typically) not due until the year following business formation.
Now, Let’s Cover the Advantages of Filing NOW…
It’s called ‘delayed effective filing’… and here’s WHY that’s important.
As you may know, to register your new company with the state, you must file articles of organization to set up an LLC within the state where you plan to do business.
When you file this document, you'll, typically, be given the choice of requesting the state to approve your entity as soon as they receive the document… or at a future date that YOU specify, like January 1st.
To have your LLC start in the new year, you simply designate your company's effective start date as of January 1, 2023, within your articles of organization.
When the state receives the filing, it will be processed in the order it was received… and that’s why you want to file NOW! Think of all the other people, who are also filing in your state.
You don’t want to get lost in the shuffle or end up being a victim of any other bureaucratic delay…
So Do It Now.
While filing these documents is relatively simple, mistakes or omissions can result in a delay of the documents getting processed and even additional fees, according to The Robinson Advocacy Group, a law firm that helps people, by creating and filing these documents.
There are a few states that don’t allow businesses to use future effective start dates, so you’ll want to find out if your state is one of those states.
What’s your business going to be? If you know you want to start your own business, but aren’t sure what you want it to be, why not consider wholesale real estate?
Why a Wholesale Real Estate Franchise is the Perfect Business for Your New Business Entity
If you’ve never considered a franchise business model before – but now you’ve decided to go into business for yourself – wholesale real estate may be right for you.
Don’t confuse ‘wholesale’ real estate with retail real estate… BIG difference! The retail housing industry is really suffering right now, as we’ve written in previous blogs.
The recent Fed rate hike, as expected, caused mortgage rates to rise… and rise… and rise! Add that to the highest inflation in 40 years, and we have a housing market in free fall.
As of October 11, 2022, the 30-year fixed-rate mortgage rose to 7.11% from 7.06% the day before. And just a week ago, the 30-year fixed APR was 6.87%. Where it’ll end is anybody’s guess.
So What is Wholesale Real Estate… and Why is it Virtually Unaffected by all of the Market Gyrations?
Simply put, wholesaling deals in ‘off-market’ properties. These are properties that are not listed on MLS because the homeowner needs to sell quickly. They don’t have time to wait to find a buyer, willing to pay top dollar.
KeyGlee only deals with these off-market properties. They offer a below-market (below retail) price, but a fair one – and then, quickly, find another investor to buy the property in ‘as is’ condition. And we have an extensive buyers list of investors all over the country.
Wholesale real estate investors can help these people out of a bad situation. And by helping, I mean REALLY helping our fellow human beings to get out of a difficult situation, with their dignity intact… and a fair price for their property.
And because of our incredible relationships with the investor community, we have buyers we work with all the time. This allows us to quickly find buyers for the properties we have under contract.
We have our own acquisition (finds sellers) and disposition (finds buyers) teams at KeyGlee. And our franchise partners get to participate in this well-oiled machine of matching sellers with buyers – all over the country.
KeyGlee has consistently generated 8-figures a year, since its inception just 5 years ago. We started franchising in 2020 and, today, we have 100+ franchisees in the nation.
We’re currently in an expansion phase, and we’re looking for experienced real estate agents, wholesalers, FixNFlippers, or business-savvy entrepreneurs, who may be interested in adding a franchise to their portfolio.
For more information about franchising with KeyGlee (and to secure the FDD), we have a quick, simple way for interested, qualified people to evaluate our franchise business model.
Just schedule a phone call to kick things off. You’ll get the facts, so you can properly evaluate us, while we evaluate you. Sound fair?
Franchising with the right company is vital. And in today’s economically-challenging times, it’s more important than ever to partner with a nationally-recognized and respected company.
Of course, you’ll need a business entity to run your franchise business, so the sooner you have a conversation with our team, the sooner you’ll know if you want your business to be a KeyGlee franchise.
It’s now October, so there’s not much time left to get your documents filed with your state to secure a January 1st start date.
So go ahead and get started now. You’re just one conversation away from getting the facts, so you can make an informed decision about your future business.
To your success,
Team KeyGlee
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