This guide describes the Florida rules. You can form your LLC in any state we sell, with Coral Filings as your registered agent: see LLC cost by state.
What an LLC changes for a freelancer
- Liability. Contract disputes and claims generally go against the LLC, not your personal assets, if you keep finances separate. An LLC does not protect you from your own negligence or personal guarantees; ask a licensed attorney.
- Getting paid. Clients pay the LLC. You give them a W-9 with the LLC's EIN instead of your SSN.
- Credibility. Agencies and larger clients often prefer to contract with a company.
Taxes
A single-member LLC is taxed like a sole proprietor by default: profit goes on Schedule C and you pay self-employment tax. The LLC by itself doesn't raise or lower your taxes. An S corporation election later can, which is a question for a CPA.
Licenses
Most creative and digital work needs no state license, only a Local Business Tax Receipt where you work.
Forming the LLC in another state
The licenses above are Florida's. We form LLCs in 49 states and Washington, D.C. (Florida included), and corporations in nearly every state, and act as your registered agent in each. Compare fees in LLC cost by state and corporation cost by state.
Frequently asked questions
Does an LLC save freelancers taxes?
Not on its own. A single-member LLC is taxed like a sole proprietor unless it elects S corporation status.
This page is general information, not legal or tax advice. For your specific situation, talk to a licensed attorney or CPA.