A week ago, for no other reason than it being a numerologically significant day, I headed downtown to officially register as an LLC.
Well, that's not entirely true.
For most, the distinction between LLC/LLP vs. S-/C-corp vs. sole-proprietorship can be somewhat foreign. Even after four years of business and accounting classes, I had to brush up on each of their subtle differences. And while the textbook definition remained vaguely familiar in my mind, its actual execution when starting a company wasn't something we were taught.
But nowadays, with a simple Google search, anything is possible. The entire process ended up being fairly straightforward and minimally expensive. Even the acquisition of an IRS-issued EIN was done online with approval given in minutes.
So what are the benefits of being a limited liability company?
Seriously, there are plenty of resources available that can explain it better than I ever could. However, personally, it's a (federally recognized) gesture of commitment to sustaining my business. Many may decide to make money on the side with the DSLR they got for their birthday, and there's certainly nothing wrong with that. Far be it from me to all of a sudden have a "holier than thou" mentality because of this filing. Simply, registering your business with the state is that next step to legitimizing a foothold in the industry. Also, it's illegal not to declare income whether it be from a hobby or freelancing (hello, getting audited!).
Although I'd grasped the concepts in business school, I never thought I'd need it other than to pass a midterm. So I'm more than happy, perhaps even lucky, to get to apply that knowledge in something I'm passionate about. There are still a number of items on my checklist as I alluded in my midyear post—this is certainly one of those milestones. And on a date difficult to forget at that.
Incidentally, that day also marked our first six months of marriage!