The type of a business a LLC perform

[kkeuma]

Good evening everyone,

Not sure if this is in the right place or not, but let me know if it isnt.

Everyone I talk to (business lawyers) and see on the internet in regards to setting up an llc asked what type of business is to be conducted. My intended business is to import a bag from south korea, nothing nefarious. My question is, does it matter what my business is? I only expect this bag venture to last a max of 5 years, but after that, if I want to do something different with my llc (like perhaps start a consultant business), can I? Or do I need to shutdown my current llc and start a new one? Thanks.


-Kila

[Business Attorney]

My question is, does it matter what my business is?

Kila, the answer is that it MAY matter depending on the answer. In your specific case, the answer is that it probably doesn't matter but the business lawyer you are talking to doesn't know that until you answer the question.

In many states, certain types of businesses cannot be LLCs. The list is getting shorter, but depending on the state it may include doctors, lawyers, engineers, banks, insurance companies and more.

In other cases, a different entity may make more sense. For example, if you are going to make an election to be treated as an S corporation, in Illinois it may save you $400 up front and $150 a year to form a corporation instead of an LLC. That may make more sense for certain types of businesses more than others.

So even though it may not make any difference in your case, or in most other cases for that matter, it is prudent for the person advising you to make sure that your business is not in one of the minority of situations where it DOES matter. They can only find that out by asking everyone every time.