I thought forming an LLC would change how my income was taxed

Yeah, an LLC doesn't change how you're tAxed by default. It's just a legal structure. You're still a sole prop for tax purposes unless you elect S-corp. Sorry to be the bearer of bad news.

LLC = legal protection, not tax magic. People confuse the two all the time.

You didn't mess up, but you might want to look into S-corp election if your net profit is high enough. That can save you some self-employment tax, but it comes with more paperwork and payroll requirements.

Not nothing—you got a cool LLC certificate to hang on your wall! 😂

Actually, the LLC does provide liability protection, so it's not useless. But yeah, tax-wise, it's a pass-through entity by default. You could also look intoo deductions you might be missing—home office, software, etc.

S-corp election can be a game-changer, but only if you're making enough. If you're netting $40k, the savings might be eaten up by accounting fees and payroll taxes. Do the math first.

Also, check if your state has any LLC fees or franchise taxes. Some states nickel and dime you every year.

Ouch. CA is brutal. But if you're making decent money, the S-corp might still be worth it. Talk to a CPA who knows your situation.

CPA? I thought this forum was the CPA.

One more thing: if you're a single-member LLC, you can still file Schedule C. The LLC doesn't change that. But you might want to separate business and personal finances to maintain liability protection. Commingling funds can pierce the veil.

Veil piercing sounds painful.

Don't forget to deduct the LLC filing fee! That's a business expense.