Small business owner formed an LLC because she thought she was going to go into partners with someone. It was a good idea to form the LLC in ANY event

QUESTION.
I recently started a small business in NJ as an LLC. I originally thought I would be adding a partner, but that did not materialize. I am the only person in the company - no employees. I have a federal tax ID. Can I change this to a sole proprietorship in NJ using the same federal tax ID?

ANSWER.
You can contact NJ and have your LLC discontinued. However, I recommend you keep it. Using the name with the LLC at the end will make your business more credible. You can call yourself president of your LLC. For tax purposes an LLC is a flow-through entity. So you won't be saving any taxes by discontinuing it. And you will limit liability for yourself if you keep the LLC. LLCs can be single member or multi member. You happen to have a single member one at present. I recommend to all my SCORE clients that they get either an LLC or a C corporation when starting their business. I think you have done just fine to create an LLC.

I think I have answered your questions. Good luck! Regards, -Jeff

Jeff Lippincott
SCORE.org Counselor
Princeton, NJ
scoreprinceton @ aol.com
www.scoreprinceton.org
http://www.jlippin.com/