Moving from full time to part time, what can I automate?
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Also a lot of "Freelancers" you will find have at least formed an LLC.
If you do go through with this you need to convert it to a contract or a $40 to $50 per hour rate. I am sure you are thinking your boss would laugh at you over this. They already think you are only work $20/hour.
Which is back to my original point; if you are going to work even 5 hours a week somewhere why not keep it W-2?
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@guyinpv said in Moving from full time to part time, what can I automate?:
I mean, if an LLC is cheap or doesn't take much to maintain, then no big deal, but working as a SP is also just fine in certain circumstances too.
Few hundred bucks and zero effort to maintain. Literally, if you even question this having this you should stop all plans for working on your own this instant. I mean that as seriously as I can. I would not do one hour of work as a side project without an LLC (or more), you are talking about actually working full time like this! The gap between where we are on this is hard to describe. You are talking about working thousands of hours a year at a level of risk I would not consider for a single hour a year.
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@guyinpv said in Moving from full time to part time, what can I automate?:
..., but working as a SP is also just fine in certain circumstances too.
Not, it cannot be stated enough that this is so completely untrue. There is no condition where you are getting paid by someone where this is true. It's legal, the government does not require you to be sensible, but that's not a factor in this discussion. Since there is no one at risk but you, the government has zero responsibility to stop you from doing something reckless.
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@magroover said in Moving from full time to part time, what can I automate?:
I was sued for $75k about 10 years ago, and it was an experience that led me to leave self employment. I had about 20 customers over a period of 10 years.
Too boot, it was a company with 2 employees. When interrogatories began he claimed over $1mm in damages. The $75k was just enough in punitive damages to remove it to Federal court, which he intentionally did because all the filings cost more.
My $10k retainer I paid to "teach him a lesson" was gone in 3 weeks.
I had hosted this got a server with some CRM called ACT at a colo. After months of non-payment I turned it off. The truth was that he already went bankrupt. He claimed this caused his business to fail.
Eventually my attorney got my PMI (private mortgage insurance) to take over litigation as he would have taken my house and everything else I had.
Its a long story, but I had the same cavalier attitude for the decade leading up to that. Simply ran a business by filing a sole prop fictitious name registration with the state so I could open a business checking account.
Wow, great timing on having that story. I've never known anyone to risk running a business as an SP before, so we only know the exposures that LLCs see that would have been total disaster had they been SPs. That's so scary.
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SPs carry a LOT of risk that LLCs do not (small ones, anyway) in the same way that insurance is dangerous. One of the reasons that consultancies avoid general insurance is because being insured makes you a lawsuit target and insurers rarely pay out. So you increase your risk of going to court by far more than you mitigate the risk through insurance protection. Insured companies are just more valuable to sue.
SPs, likewise, are worth a fortune to sue whereas a small LLC is not. Think about it, you have client that isn't doing well, they need some money. If you are an LLC, they can sue you for the value of what... a computer, an office chair, some file folders, what little cash you keep around. What are they going to get, $2K? That's very small payoff and they take on the risk of you winning in court and countersuing with your personal funds.
Now that same situation with an SP, that customer can sue your little side business and go after your car, your wife's car, your retirement plan, your house, your cottage, your kids' college funds... everything. Instead of a $2K payoff, maybe it is a $400K payoff. That puts a target on your back.
So in one case, you are not a target AND have protection. In the other you ARE a target and do NOT have protection.
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I just don't think of it as living on the wild side.
Again I'm not hosting people's data, no contracts, agreements. Most work is short term, jobs or tasks that I bill an hour or two or three through arbitration.
I'm also considering full time remote work, those steady jobs have their appeal.
I've done "side work" for a decade+ with no issues, usually word of mouth, normal human beings, not those scum bottom dwellers. But certainly as I consider ramping up my game, the LLC was always on the table, just didn't think of it as an immediate first thing. Too many people attempt to start businesses and then die immediate in too much administrative crap before actually doing any work or creating any product!
We need our business card, flyers, mailers, ads, website, we need lots of tech and services and trackers and reporters and a CPA and S Corp and a company car and and and and.....and then the business diesI had this idea that I would focus on the core, actually making some money and finding good clients, and build the "businessy" stuff over time. I don't want to drown in startup costs and administration before I have a chance to deposit some cash!
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@guyinpv said in Moving from full time to part time, what can I automate?:
I just don't think of it as living on the wild side.
I know and that terrifies us that you are not understanding what we are saying.
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@guyinpv said in Moving from full time to part time, what can I automate?:
Again I'm not hosting people's data, no contracts, agreements. Most work is short term, jobs or tasks that I bill an hour or two or three through arbitration.
Yes, and again, none of that matters. You are making excuses that don't make sense given what we are explaining as the risk. This is highlighting that you are not taking the risk seriously, rather than explaining to us that you are not at risk.
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@guyinpv said in Moving from full time to part time, what can I automate?:
I've done "side work" for a decade+ with no issues, usually word of mouth, normal human beings, not those scum bottom dwellers.
Again, this is the Russian roulette problem or the driving without a seatbelt problem. This is a basic misunderstanding of risk. Just stating this tells us that you are more at risk that we would have guessed because you are not assessing risk well.
Five out of six people who play Russian roulette claim that it is perfectly safe.
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@guyinpv said in Moving from full time to part time, what can I automate?:
Too many people attempt to start businesses and then die immediate in too much administrative crap before actually doing any work or creating any product!
That's not applicable here. We are talking about the most fundamental piece of starting to do work that there can be. You are not taking this seriously. Mocking the most important business advice that you can get isn't going to help you. If you don't believe us, ask your attorney.
If you don't feel that filing an LLC is worth it, seriously, don't continue down this path. Imagine if you had customers that laughed at you and mocked you for suggesting that they have backups of their data. "Too many businesses waste money taking backups!" You'd think this was a joke, right?
Not filing your LLC is the entrepreneur equivalent of not taking any backups in IT. If a business told me that they thought backups were a joke, I'd tell them to close up shop and go home. I'm saying the same here.
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@guyinpv said in Moving from full time to part time, what can I automate?:
We need our business card, flyers, mailers, ads, website, we need lots of tech and services and trackers and reporters and a CPA and S Corp and a company car and and and and.....and then the business dies
I had this idea that I would focus on the core, actually making some money and finding good clients, and build the "businessy" stuff over time. I don't want to drown in startup costs and administration before I have a chance to deposit some cash!
You are not taking any of this seriously.
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LOL
I was EVERY BIT as defiant as @guyinpv and did very well for 10 years. No way you could have convinced me of wasting money on lawyers. The attorney finding a way to put it on PMI saved me. I had a job as soon as it was over.
And its STILL all over Google if you search "et al %mybusinessname%". During the case it topped my own SEO when you looked up my company name. Very embarrassing.
You don't have to do anything wrong. Its expensive even to fight a frivolous lawsuit.
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@magroover said in Moving from full time to part time, what can I automate?:
You don't have to do anything wrong. Its expensive even to fight a frivolous lawsuit.
And it doesn't have to be customers. We've had to fight our own telephone provider who thought that they could make a quick buck on us because of our insurance. And we've caught vendors like MegaPath trying to do it to our customers, too. Make up a fake $10K phone bill, hope the customer or their insurer pays, suddenly you have a huge debt that you have to have a lawyer to fight.
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Making an LLC in Florida is $120, takes 15-20 mins, and is 100% online. It takes less than a week before you have your EIN in hand. I assume it's just as easy anywhere else.
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@IRJ said in Moving from full time to part time, what can I automate?:
Making an LLC in Florida is $120, takes 15-20 mins, and is 100% online. It takes less than a week before you have your EIN in hand. I assume it's just as easy anywhere else.
Texas used to be $60 but I heard is $600 now. My roommate is trying to do that for her business. Pretty much everyone I know has an LLC for any little side work or projects that they might want to do. Not IT people, I mean just in general. Not people "starting businesses" but just wanting basic legal protection for normal stuff in life.
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Its $300 in PA if I remember right.
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@IRJ said in Moving from full time to part time, what can I automate?:
Making an LLC in Florida is $120, takes 15-20 mins, and is 100% online. It takes less than a week before you have your EIN in hand. I assume it's just as easy anywhere else.
Thats the one nice thing about Florida. Its very reasonable for business.
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@stacksofplates said in Moving from full time to part time, what can I automate?:
Its $300 in PA if I remember right.
$100 in GA
$140 in Delaware -
Delaware and Nevada are the top incorporation states.
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@stacksofplates said in Moving from full time to part time, what can I automate?:
@IRJ said in Moving from full time to part time, what can I automate?:
Making an LLC in Florida is $120, takes 15-20 mins, and is 100% online. It takes less than a week before you have your EIN in hand. I assume it's just as easy anywhere else.
Thats the one nice thing about Florida. Its very reasonable for business.
But horrible for employees.
