Does anyone have advice on starting an LLC for their ebay store?
pros & cons
lawyer or online site such as legalzoom?
responsibilities once you have formed the LLC?
good tutorials online?
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@qwachansey If you buy this as well you will have the entirety of human knowledge on your bookshelf!
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Not a lawyer or CPA but for most people I think a DBA would be sufficient to run a sole proprietorship Pokemon flipping side hustle.
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I used Legalzoom for mine and it was easy.
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S Corp if you make a lot, LLC if you make a decent amount, DBA if you make less
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There’s really only one thing to think about…a sole prop gives you zero personal legal protection in a suit against the company…llc will give you some. Not sure who is doing enough shady things to get sued lol but have to consider. A lawyer will also charge you a lot for an llc set up, but you should not pay whatever they are charging, it’s really not that complicated 
disclosure not an attorney or accountant
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We have Pokemon YouTubers like Pokenav who is a CPA/business degree telling people the first thing they should do is do an LLC. 99% of most new collectors won’t need it. The amount of dumb information and investors is mind blowing. There’s a young sports card girl 17 who is making investment videos. Her parents lent her $10k to make her sports card purchases. Why the F**k are people listening to a 17 year on investing!!!
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Wharton > HBS 
just saying
I’m not aware of “Pokenav” and I would tend to agree with you that there is some information being thrown out to newbs in the hobby that is imprudent. To each their own I guess. Without disclosing too much, I’m at a point where an LLC is a reasonable option. I think I’ll bring in more through pokemon than through my actual job and my business expenses are significant. So I understand what you’re saying but also that’s why I’m posting on here. I’m looking to get info from real collectors, not advice thrown out on Youtube.
Besides protection that an LLC offers I’m really interested in being able to use a business credit card to save on paying taxes on items that will be resold. I also don’t know enough about the responsibilities and accountability that I have after I establish an LLC and was wondering if anyone would speak to that? What will I need to do after I the initial paperwork is done?
Thanks!
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I would like to know best options as well. I believe after you sell maybe 5k or so you have to open a LLC of some sort. Stuff like this usually isn’t as simple as a Google search. So thanks for posting this topic
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I am not a lawyer and I am not a CPA though I’ve consulted with (and paid for their services) both. I live in Upstate NY and this stuff varies greatly by location and also by year.
I’ve operated with annual gross sales of 6 figures+ on and off eBay in every year since 2012. I have a business PayPal, a business checking account, a business credit card, and a business eBay account. I buy wholesale Pokemon product through two official distributors (as well as other TCGs and gaming supplies). I am registered with my county with a DBA (Doing business as) only (Sieds_steins), and I file my income as a sole proprietorship under my personal SSN. I pay no additional annual fees for a “business”. Personally I’ve looked into it and an LLC adds nothing of value while adding paperwork and cost.
This isn’t necessarily a recommendation to do what I’m doing. Just to demonstrate that it’s possible.
Reminder that I am not a CPA nor a lawyer and you should consult with both in your county for laws pertinent to you. You cant just ask strangers on the internet and trust them blindly (including me).
Also a reminder that free advice is usually hardly worth the price.
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So basically we should contact a lawyer and CPA to see what they recommend based on sales numbers, location etc. Thanks for the advice I’m just about to start selling some cards myself. I was just double checking before I accidentally go over selling limits etc without having a business account.
From my understanding an LLC is a direction you should go if you have a higher level of liability. I separates you as an individual from your business but the business is still you, if that makes sense. If you were to be sued, its the business first and they cant take any personal assets.
Tax wise you have an EIN but you don’t really pay yourself because you are still the business. You “Retain Earnings” and are taxed on the business earnings like an individual as a whole.
Make sense?
It wouldn’t be a bad way to start IMO.
Personally my method was to sell and sell and sell without any regard for the tax implications until one day I woke up with a 1099-K for 6 figures and no idea what to do with it. I then decided to then go sit down with all the proper people and it was more expensive and more heartburn than if I had prepared up front. It would be much easier to do it all today personally as now eBay collects sales tax automatically and that was always the most annoying part (and the part I had to go back and pay penalties on having not done it).
Check with your local county and/or state offices and see if they have any resources for small business startups. I know I spoke with some people at mine and they pointed me to all the proper forms and had some recommendations for people in the professional fields. Also reach out to a Pokemon distributor and see what information they need on file from you to get you up and running. These two will be free so probably the best start. In NY one thing they’ll need is an ST-120, the same thing you could use to avoid paying sales tax on eBay for items purchased for resale.
support.pokemon.com/hc/en-us/articles/360001004653-Who-are-your-wholesale-distributors-
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In most situations which I can envision someone being sued running a collectible resale business you would have no protection from an LLC. You can also have liability insurance for your business without having an LLC.
Are you saying that the chances of someone being sued selling cards in minimal to none, or are you saying that the LLC doesnt protect the individual from by declaring that business assets are indifferent from personal assets?Liability insurance in either circumstance just protects to a certain monetary value before they can start taking personal or business items as compensation.
@credits I was saying something intentionally vague to cover multiple things.
Mainly though I do think potential liabilities are low when selling a collectible. People dont consume it. It doesnt risk their safety. There arent too many risks of loss through any avenue I can think of. The few ways you could potentially be held liable in a lawsuit are likely things that an LLC wouldn’t cover. They arent an impenetrable shield. They dont cover criminal actions or negligent actions.
Take a mechanic as IMO a good LLC candidate. They benefiet much more by the protection an LLC provides. If they improperly put the wrong oil in they can cause thousands of dollars of damage. If some of their equipment malfunctions similarly damaged can happen. If they unintentionally damage a brake line while working on something else people can literally die.
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