HELP !!! Please :)

[kschuyler]

I'm confused... I sell insurance in MN and of course have a standard producers license. Someone mentioned I should get an LLC for some tax benefits and protections... Okay seems like a fine idea.
I went to LegalZoom to get 'er done and one of the questions asked on the form was.. "Do you need an Agency License"?
So I called MN Ins Department and they said "I don't know"... then I called the Secretery of state who kind of said the same thing. I'm kind of shocked. I can't be the first guy to have this question.
So here goes...do I need some kind of additional "Agency license" to form my LLC? what the heck is it and what does it do for me?? Please assist. Thank you to anyone who can help.

 

[VolAgent]

Really that is a question for the state DOI and secretary of state. In Tennessee, an agency does not actually need a license, although there is one available. It can cause some issues when expanding into other states, which I believe is why one is available. If they can't answer, you will probably need an attorney. This is one of the areas in which a DIY legal solution can let you down.

Also, do you need an LLC? If you are a one man shop, the legal protections are almost non-existent and there may be little if any tax benefits.

 

[kschuyler]

Yes. 1 man shop licensed in several states and selling health insuurance by phone... An upline mentioned that being an LLC would be smart. I did read about it and like you mentioned it appears I can swrite off expenses whether I'm an LLC or not. As far as protecting assets it seems E&O has the same purpose...yeah I'm confused.

 

[DHK]

E&O is protection for your own actions through negligence (but not fraud). That's because we're in a licensed profession, and that licensing is so we can be held accountable for our own actions (or inactions).

An LLC can be good if:
- You have hired employees; they can sue the LLC instead of you personally should there be an employment dispute.
- You have subcontracted agents; any chargebacks can be the liability of the LLC instead of you personally.

Other than that, it's generally a 'wash' for the tax benefits.

Of course, this is not legal or tax advice.

 

[kschuyler]

Thanks..I emailed my tax guy but I also have read that a 1 man shop may not benefit from LLC...Maybe I'll just keep going how I am. I appreciate the answers and this forum in general.

 

[Orion1]

It really depends on your specific situation and how you set the entity up in your state and what exactly you’re looking to do. If you are a one man shop an LLC may not be the best option best to talk to your accountant and a good attorney.
If you are licensed in multiple states assigning your commissions to the entity. Looking for investors or taking on a partner or having employees. It’s best to create the entity as a pass through until things change IMHO. But it’s individual circumstances. Start with your goals and your buesiness plan. The choice can be made for you depending on what you want to do or what your resident state requires of you.

 

[Mike007]

Don't worry about it. It is not needed or required, especially for one man operation. Now, if you want to build the next Primerica or the next WFG, it would be wise to LLC.

 

[Markthebroker]

I'm here in California and just finished setting up an LLC. My LLC did need to be licensed. And, to be licensed, it also needed e&o insurance, fyi.

 

[BADTROUT]

When in doubt get an LLC as at least one veil of defense if you are sued for any reason. Get E&O for that LLC and it will extend to you, your employees and contractors in most policy language and most importantly license up! Credentialing your business entity to me is important even before getting an employee. There are many benefits to legitimizing your business from a degree of separation from you, the individual if sued, to tax write-offs, to establishing business credit that is different than yours. All that said... I'm no expert on law or tax, I will advise you to consult your own law and/or tax professional.

#notrealtaxadvice
#notlegitlegaladvice #imnotresponsibleforanydecisionsyoumakebecauseofsomethingyoureadinaforumpost
#justsaying

Not to break the thread... but do those hashtags ever do anything other than making people who use them look stupid?

 

[Markthebroker]

When in doubt get an LLC as at least one veil of defense if you are sued for any reason. Get E&O for that LLC and it will extend to you, your employees and contractors in most policy language and most importantly license up! Credentialing your business entity to me is important even before getting an employee. There are many benefits to legitimizing your business from a degree of separation from you, the individual if sued, to tax write-offs, to establishing business credit that is different than yours. All that said... I'm no expert on law or tax, I will advise you to consult your own law and/or tax professional.

#notrealtaxadvice
#notlegitlegaladvice #imnotresponsibleforanydecisionsyoumakebecauseofsomethingyoureadinaforumpost
#justsaying

Not to break the thread... but do those hashtags ever do anything other than making people who use them look stupid?

#Ihavenoidea
#I'mtooldtounderstandwhathastagsarefor
#oldfart
#clueless