How to Know Whether an LLC or a Corp is the Best Fit for Your Construction Business

How to Know Whether an LLC or a Corp is the Best Fit for Your Construction Business

There are a number of factors that should be considered when deciding whether to set up your business as a corporate or limited liability company (LLC). This includes the type of work that you do, the number of employees that you have, as well as various tax considerations. Deciding to formalize the structure of your company as an LLC or corporation has important implications and should only be undertaken when you have a clear understanding of the pros and cons of each. Once you have a general contractor license, and before filing papers, consider getting expert advice to ensure that you make the right decision for your business. Choosing a Corporation vs. LLC An LLC (limited liability company) is a hybrid form of partnership that offers many of the advantages of a corporation and a partnership. Profits and losses can be passed through to owners without the business being taxed, and owners are shielded from personal liability. A corporation can be taxed, held legally liable for its actions and can make a profit. The main benefit of a corporation is the protection from legal liability while two key disadvantages are the costs to incorporate and the extensive paperwork that needs to be filed. An S-corporation (Subchapter corporation) helps avoid double taxation which is a drawback for regular C corporations. Business Freedom We find that, for most construction businesses an LLC is the best fit because, while both a corporation and an LLC offer protection for the owner from liability, an LLC offers more freedom in how the business is managed. An example of this is in an LLC’s operating...
What Are the Most Important Legal Requirements for Becoming a General Contractor in Florida?

What Are the Most Important Legal Requirements for Becoming a General Contractor in Florida?

Florida is a great state to become a general contractor, with a multitude of building projects to keep contractors busy. But becoming a general contractor in Florida comes with plenty of particulars to keep track of and stay on top of. These are some of the most important legal requirements that are necessary if you are a Florida general contractor yesor plan to become one in the near future. Annual Reports Every business in Florida must file an annual report every year. It is normally due by May and failing to file the report can result in severe penalties, including a hefty fine that can cost your company hundreds of dollars. The administration of your company could even be dissolved by the state. Workers’ Compensation Insurance or Exemptions All contractors in Florida are required to carry workers’ compensation insurance on employees, but exemptions are possible for up to 3 officers. Once an exemption is obtained, it must be renewed before it expires. If you fail to renew the exemption, you will be responsible for obtaining workers’ compensation insurance. Failing to do either one will result in liabilities for the company. Lien Law An important aspect of a general contractor business in Florida is remembering to follow lien law. A construction lien is essentially an affidavit which states that a general contractor has provided supplies, labor, or services to improve property and has not yet been paid for these services. Florida’s lien law governs the requirements related to this affidavit. The lien is secured for the value of the materials, labor, or services. The Notice of Commencement is a critical...
The End of Paper Licenses for Florida General Contractors

The End of Paper Licenses for Florida General Contractors

A general contractor license is a valuable thing to have when you are pursuing your career goals of working in and on property. For Florida contractors, license requirements mean passing an exam, meeting a list of additional requirements (four years of documented experience in the field, credit report, financial statements, etc.), and then waiting for a paper license to be delivered in the mail. At Contractors Reporting Services, we understand that you want to get to work as soon as possible. Up until now, when you applied for a new general contractor’s license in Florida or even a renewal, there was often a waiting period of up to two weeks to receive a paper license in the mail. As of 2018, the Department of Business and Professional Regulation (DBPR) will be moving the Construction Industry Licensing Board and the Electrical Contractor’s Licensing Board over to a paperless system. What does this mean for My Florida Contractor’s License? The news that the DBPR is changing the way licenses are distributed is huge for you as a contractor. No longer will you have to wait two weeks to receive your paper license in the mail; instead you will be able to print out your license at your own personal convenience after the application has been approved. This applies to both new license applications and renewals. Being able to access your general contractor license via the paperless medium will mean that the time between license approval and obtaining it is slashed almost entirely. There is the potential instant access after your Florida contractor’s license is approved, meaning that you will be able...

Education and Experience to Help You Obtain Your Florida General Contractor’s License

When you are seeking your Florida general contractor’s license, there are many requirements to be aware of. Among these are the education and experience requirements. Four years of experience are required, and some of that time can be substituted for education. Here are the specific experience requirements for obtaining a general contractor’s license in Florida, and ways that higher education can give you an edge when you apply. Experience Four years of experience are required, and one year must be in a supervisory role. The supervisory requirement can be substituted for at least three years of undergraduate education. A general contractor must be knowledgeable about various areas of construction. For this reason, anyone applying for a Florida general contractor’s license must demonstrate experience in four areas from the list below: Foundations/Slabs in excess of 20,000 square feet Masonry walls Steel erection Elevated slabs Pre-cast concrete Column erection Formwork for structural reinforced concrete Your experience has to be verified by a Florida certified contractor, or an architect, engineer, or building official who is licensed in the United States. Military personnel and veterans can use their experience to obtain a contractor’s license. Recent provisions allow for up to three years of military experience to be applied towards a certified contractor’s license. In addition, these individuals can have their fees waived. To make use of these benefits, military personnel and veterans must submit the following documents when applying for a general contractor’s license: Veteran Fee Waiver Form Military Service Verification Form Professional Licensure Application for Military Personnel/Veterans/Military Spouses (MVL 003) Those who are active duty must provide a copy of their military orders Veterans...

How to set up an electrical company in Florida – Contractor corporate/LLC services at Contractor Reporting Services

After you earn your electrician license in Florida, your next step is to begin to form your own company by contractors corporate. There are several options to choose from when deciding how to set up your electrician company; should you choose an S-corp or an LLC to better benefit your business model and future goals? At Contractor Reporting Services, we offer contractors corporate and LLC setup services to help guide you through the process of starting your own electrician company in Florida. During this process, we will help you create future goals and benchmarks for your business and then build your underlying business structure to help you achieve those goals and move forward with business growth. The Houston Chronicle states the first and most important step needed in order to form a successful electrician business: Structure your electrical business. Choose your business structure with the aid of a Certified Public Accountant familiar with small service businesses. Visit your city or county clerk’s office to obtain a business license, and inquire about additional permits required in your jurisdiction. Consult with a commercial insurance agent about business liability and professional liability insurance. Finally, ask your state Department of Revenue if you need a sales tax number for your service business. We have a team of dedicated consultants who have been helping contractors since 1965 set up successful businesses. Our contractors corporate or LLC setup services for Florida contractors includes a detailed consultation about the differences between corporations and LLC companies, and the benefits and risks of each type of business structure. We will work with you to help you decide the best...

Which is the better option for your HVAC business: a LLC or S-corp setup?

Starting a HVAC business in Florida can be daunting, especially when faced with the decision of which business set up to choose: a LLC or S-corp. If you’ve researched the two business plans at all, you will see that they offer vastly different benefits. If you are not sure what you want your ultimate company structure to look like, you might find it difficult to pick the foundation of that structure. Luckily, at Contractor Reporting Services, we offer Florida contractor corporate/LLC setup services to help guide you through the process of deciding which structure works best for you and then actually putting that structure into motion. For most HVAC businesses just starting, we recommend that you choose a LLC setup. While this is not a blanket statement and is often determined by your ultimate business goals, a LLC setup usually works best for small businesses with only one employee. Here is what Mashable has to say about LLC setup for contractor businesses: With its roots as a C Corporation, the S Corporation involves structure, formalities and compliance obligations, which can be too burdensome for the solo entrepreneur, in other words, a “payroll of one.” If you incorporate as an S Corporation, you need to set up a board of directors, file annual reports and other business filings, hold shareholder’s meetings, keep records of your meeting minutes, and generally operate at a higher level of regulatory compliance than your business might need or want to deal with. With the LLC, this isn’t the case. LLCs just use an informal operating agreement. What to know: If you want less red tape...