Forming Insurance Business Entity

[LionPrideFinancial]

Does anyone have any information or guidance on how to effectively form a business in the insurance industry?

Here's my situation, just in case there are some real experts out there as well:

• I already have an LLC registered in Wyoming
• I live in Colorado, and currently sell insurance in multiple states.
• I do not yet have a Business Insurance license in any state.
• Goal is to significantly reduce personal taxes, and business taxes
• Secondary goal is to limit personal liability if and/or when a downline agent has debt that is rolled up to me; or any other legal problems that may arise.
• Tertiary goal is to hire full-time staff that sell within the "house" and have a guaranteed base wage paid W-2 statutory under the business structure.

I chose to form my business in Wyoming for the Amnimity aspect of it, and it's a short hour drive away from where I live.

Who here can offer guidance on this topic? Thanks!

 

[Todd King]

I don't claim to understand the new tax laws, but from the way I understand it you will be bettor off tax-wise to form the corp. I think this might add another 20% or so through the corp that you can't get now. Please ask your tax adviser to explain it to you.

Whether you run the business through the corp or not, chargebacks from your agents still need to be paid. The only protection you have with that is to not get them in the first place. If you don't pay the chargebacks the insurance company will terminate your contract, put you one a Vector One report, and then may also put you in collections. Keep in mind....you ARE the company since you are the sole proprietor.

If you are going to have your agents (employees) on salary, that means they will be LOA to you (Licensed Only Agent). That just means that all monies paid by the company go to you (your company) and then you have to pay your agents. That also means that chargebacks will never roll to them. They will roll straight to you.