Medically retired, 100% P&T, and shifted to private sector as an independent contractor…is it worth setting up an LLC?

[danielhm]

Hi folks,

Started consulting for a company as an independent contractor and will be pulling in about $150k net this year from the job. I’m living in Illinois, and working at an Illinois satellite location for a California-based company. Contract runs through Dec 31.

Add that to my post-military benefits (TRICARE Select, VA healthcare, disability payments, etc) and I’m kinda set in some other aspects.

At what point does it make sense to set up an LLC? I feel like it’s a bit unique because I don’t really care about purchasing health insurance and have an okay safety net.

Is it worth looking into an LLC / S-Corp for the remainder of the year?

Thanks

 

[holywalk]

@danielhm Talk to a lawyer. Yes, a company that big should not be independently liable.

 

[danielhm]

@holywalk Thanks. Will find one today

 

[lettinggo5]

@danielhm Yes LLC is worth it

 

[kingofaces]

@danielhm What you really want to think about is a solo 401(k) for the consulting business. It will allow you to avoid some of the self employment tax if you want to put money away for retirement.

An LLC is ok an S corp will probably be cost prohibitive (depending on state) and will only benefit you if you pay yourself a lower salary than the total fees taken in and then pay yourself owners comp (again avoids self employment taxes.).