Incorporate?

Discussion in 'NFA/Class 3 & FFL Discussion' started by KAG, Jul 26, 2009.

  1. KAG

    KAG New Member

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    Just wanted opinions on LLC's and what not. I am going into business with my cousin and I am looking for advice from folks running small or home based (FFL required) businesses. Thanks guys!
     
  2. mrm14

    mrm14 Active Member

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    A LLC would be a good way to go as it will protect your personal assets from any litigation or leins put upon this venture you are about to enter in. The beautiful thing about a LLC as compaired to a "S" or "C" type corp. is that they are easy to disolve.
     

  3. c3shooter

    c3shooter Administrator Staff Member

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    Mrm14 nailed it. I am not a lawyer, but I DO work for an insurance company (relax, i DO NOT sell insurance) Let's say that you sell me a firearm. A used firearm. Unknown to you, the sear is just about to fail. I have an unwanted firing of the weapon, which wounds my beloved schnauzer, Shatzy. Now, in this state, animals are chattel property- the whole "pain, suffering, mental anguish" thing will not apply- however, the $5000 vet bill, and $750 to replace Schatzy ( Shatzy kicked the bucket) WILL apply when I sue you.

    With a LLC, I have to sue the company. Lets say the jury finds you negligent, and awards damages. THE COMPANY- not you personally, is responsible for $5,750 PLUS my legal costs. I can only go after assets of your company- I cannot go after your house, car, kid's college fund, etc.

    Simple to do, you will want to get this done early, and probably have your FFL in the name of the COMPANY. BTW, your HOMEOWNER'S insurance generally does not cover business pursuits. You may want to check with the NRA on their insurance programs, or check with other dealers in your area.
     
  4. KAG

    KAG New Member

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    wow that is more than worth the price of the LLC for dummies my cousin spent $12 on.

    What about the sales tax on things like a barrel or stock? (sales tax ID???)
     
  5. Yunus

    Yunus New Member

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    Sales Tax ID, depends on your state. As for the LLC, get a lawyer to at least review your documents. The generic forms and templates may work but they might also have incorrect wording or not be specific to your area and could cause you to think you are protected when you are not.
     
  6. mrm14

    mrm14 Active Member

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    You will have to get a TIN (tax idientification number) and sales tax will go to your State Board of Equalization. You will have to have a resale liscense (resale liscense is your sales tax ID) along with your FFL and a County business liscense (your ficticoius business name). Your sales tax will be paid quarterly to your State Board of Equlization. You may also have to pay fees to your local county evniromental services for hazmat if you keep and stock items on the shelf such as powders and primers and possibly if you have over 50 gallons of liquid chemicals of oils, solvents, or paint for public sale. As far as insurance goes, you will have to carry General liability as well as product liability to CYA. You will also want to insure your building, (if you own it or are buying it) your store fixtures, and inventory, in case of fire, flood, theft, vandelsim, etc... Also dont forget workmans comp if you have employees. I dont believe NRA insures for these kind of things and there are many business type of insurance companys that you can choose from to do this. You and your cousin as a partnership under a LLC will most likely have to be named on all these documents. I also suggest that you use an attorney to set up your LLC and not use the $12.00 LLC for dummies book to this. It wont cost that much to use an attorney and he'll know your specific local area rules and laws on how to set it up properly. Also, a good attorney is good to have in your stable if you own a business.
     
    Last edited: Jul 27, 2009
  7. scrapmetal

    scrapmetal New Member

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    Going to check back here, just getting started and i am trying to work out the details of having to form a company with a business address ect. looks like you are in Texas too.
     
  8. Lanco Tactical

    Lanco Tactical New Member

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    Use Legalzoom.com I just did to setup my LLC. I am a homebased FFL (and have been for about 8 years) and had it setup as a Sole Proprietorship. Just changed it to an LLC... I wish I had done an LLC from the start as it was a lot of changing to get everything switched over but even so it was well worth it... Legalzoom.com took care of filing all the state paperwork and even does the EIN with the IRS. (You can get a EIN from the IRS over the phone now... it is VERY simple and no cost...)

    As a side note a friend of mine just got an LLC setup by an attorney and paid about $1200... I paid about $500 with legal zoom and ended up with more things. Corporate seal, stock certs and other legal docs...)

    For what it is worth...

    Nathan
    Lanco Tactical LLC