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Do You Need an LLC to Dropship

Published on: December 1 2022 by Bryan Guerra

Do You Need an LLC to Dropship

Do You Need an LLC to Dropship

i want to clarify something that i
mentioned in one of my recent videos on
10 reasons that you should switch over
from facebook marketplace to facebook
shops and if you haven't checked that
video out it's great obviously there's a
number of other reasons not just 10 but
those are just like the 10 that came to
mind you can check it out it's about two
videos ago and obviously hopefully it
will persuade you to spend a lot more
time in the business portion of facebook
shops and not necessarily using your
personal facebook marketplace okay
that said i do want to tie it into what
i did tok about in one of those points
in that video and that was the very
first point where i was basically like
one of the benefits of it is that you
can put your business ein if you have a
business right and you can put your
business ein into shops whereas you can
only put your social security number
into facebook marketplace personally
right
and the benefit of that if you have a
business already or if you plan to start
one in the future obviously is that
hypothetikally if you have like an s
corp or something like that and the way
that your business is structured and set
up you can avoid paying more you can
avoid paying more income taxes which
ideally means you're going to net more
profit right because you're going to put
your your business ein in there and then
you that's just business income it's not
necessarily your personal income and
you're gonna obviously net more money
paying less taxes that way whereas if
you can only put in your social security
number whether you have a business or
not then you are
all that profit is solely going to be
just like it would be if you have a
business llc is just solely going to be
personal income and so typically if you
weigh that against what i've just said
with the uh business ein with an s corp
and you know with facebook shops you're
gonna net a lot less money if you do it
personally with a social security number
right that's i just want to clarify that
really briefly okay and because i said
that in that video i actually got a lot
of people reaching out to me basically
asking like okay how do they set up a
business you know should they rush out
and set up a business before they start
like going heavy in the facebook
marketplace are they doing it wrong and
so i just kind of wanted to touch on the
fact that this ties into not just drop
shipping on facebook not just drop
shipping anywhere but literally any
e-commerce business specifically but
really any business whatsoever um you
know online specifically
and that's the message that like when
you're starting you don't want to add
complexity to something especially when
you're you're not like a pro at it yet
right so what do i mean by that you want
to start you want to build momentum and
then you don't need to worry about the
little nuances of it right like for
example you don't need to worry about
creating a business or coming up with a
perfect business name or you know
worrying about how to optimize how much
profit you're you're you're getting to
keep after taxes and like your take home
like don't worry about any of that stuff
it's just adding complexity okay if
you're a beginner
a complete beginner or maybe you're
intermediate you're just kind of getting
into it a little bit and you're not like
you know you're not at the point where
like you're netting multiple thousands
of dollars or like ten thousand dollars
plus yet don't even worry about that
stuff right keep building momentum keep
mastering your craft and then once you
start making decent money consistently
then kind of keep an ear out and then
start looking for different avenues to
optimize the money that you're making
post tax right with you know other
things like like shops not saying don't
start shops if you don't have a business
you should start shops regardless of if
you have a business or not but i just
kind of want to touch on the fact that
like you don't need to set up a business
if you're new it doesn't matter if
you're doing it on personal marketplace
it doesn't matter if you're setting up
on facebook shops i just was saying that
that is a potential benefit if you
already do okay so i want to hit this
home if you're just starting out you do
not need to set up a business you do not
need an ein you could do it personally
just as you as a sole proprietor and
report it on your income taxes
personally just like that and i think
that that's a lot better way to start
when you're you're just kind of getting
into it because
then you don't have to worry about all
the other nuances that come with it you
can just focus on getting better at drop
shipping which will ultimately make you
more money and then once you start
consistently making more money that's
when you move on to like the next step
which is then optimizing the money that
you're making to keep more of it right
so kind of went off wanted to engine
there but i really want to hit it home
because i didn't just get it once or
twice i got it a bunch of different
times through comments through emails
and number a number of other places so
that's the key message today hope it
helps guys