Is This Commingling Personal And Business Accounts?
I am starting my LLC and Im not sure how much money I will need to start off with. If I put 1,000 in my business account for marketing and I use it all before i make any deals is it commingling if I put more money in the account to keep it going. wouldnt any money i put into the company before i make a deal or profit be start up money? someone please help
You need to check with your accountant on the best means to fund your venture... You may want to fund with beginning equity and loan the balance it all depends on your exit stradegy
As indicated, you really need to check with your accountant or CPA on how you should do it.
Most of my business is done through a C-corp. And when I put money into it, I typically treat it as a loan to the corp. It shows as misc. income but with a matching liability.
Sometimes I do this with interest due to me, sometimes without. It just depends on what I want the liability to show. But either way, this also allows me to take money back out as loan repayment, without putting it through payroll. And I can treat any interest income to me different on my personal taxes.
If you have a good CPA for your business, I might suggest you have that same person do your personal taxes. They will be better able to advise you on both sides.
I always tell my clients to mark deposits as capital contribution if they are contributing money to thier LLC. It would not be considered commingling funds, it would simply be a capital contribution.
thanks for all of the input. I am going to my cpa to discuss a loan to the company. everyone has helped me a lot with their comments