I'm a one man LLC. As I understand it, any money I make from my web development company I can immediately take out and use it for personal reasons.
My LLC doesnt carry any debt, and the only expenses I really have is hosting, and a few advertising expenses.
As of now people write a check to my LLC, I deposit it, then go to my online banking site and transfer it over to my personal savings account (my personal and bus accounts are at same bank - very convienent). No need to keep it in my business savings.
So I really don't hold much money at all in my business accounts. In fact when I pay off hosting expenses with my Business Credit Card - I usually just use funds from my personal checking account to pay that off. Is this wrong? I don't see anything wrong with it.
At the end of the year I just tally up all the checks I received and all the expenses I incurred and report them on my personal tax return like a LLC disregarded entity should.
Anyone else handle their money similarly? The way I see it is, as long as I report all the money I made from my LLC and all the legitimate business expenses to the IRS, it probably doesn't matter how the flow of money happens on the backend?
Seems ok to me, but by co-mingling personal and business funds and generally disregarding the entity yourself are you getting much benefit from the LLC?
He is still getting the liability protection, which is the most important reason to create a separate legal entity.
I am sure lots of people do the same, and seeing these kinds of entities reported in 1040 personal tax returns is not that uncommon in small business lending.