Should we be an LLP?

[FFYBooks]

What is the name of your state? WV

Hello, 2 other ladies and myself started a business last year, with advice from our WV sec. of state office we became an LLP. The filiing fee was outrageous but we absorbed the cost and became an LLP. now the renewal fee is doubled and we are in the hole! We make education curriculum and any money made from these books goes back into the business to make more books. Somebody mentioned that we should be non- profit? Should we? Our business is very small, and as I mentioned we are making educational curriculum mainly for homeschoolers. We have not made any money this past year. She we dissolve and become something else? We would hope one day to turn a small profit to be able to give ourselves a small paycheck. HELP?! We are unsure what to do.What is the name of your state?

 

[clueless3]

Good questions!

1) Should you be non-profit?? Well, MOST people are in the business to MAKE money, to turn a profit, and to pay THEMSELVES that profit. FEW people want to turn all the profits back into the organization, which I don't think is your case, or is it?? Just because you did NOT make any money last year, it doesn't mean that you WON'T be this year or next or next. Just because you did not make any profit last year, it doesn't mean that you should turn non-profit! Only YOU can make that choice, but you should make the choice based on your long-term GOALS, not on your LAST YEAR'S PROFIT!!

2) Should you become "something else"?? Well, you could, but you have to find out WHY. Again, you should base your decision on your GOALS in the future, not necessarily on your PROFIT of the past. Turning into something else won't make your company a SUCCESS or PROFITABLE, does it?? It's normal to make NO MONEY in the first couple years of doing business. You need to concentrate on RUNNING the business to make it profitable first. The choice of the entity has more to do with TAXES (which doesn't seem to be your concern right now), not necessarily PROFITABILITY (which does seem to be your concern).