We have full coverage on our cars. Moving my mystery shopping car into our LLC would be overkill and a tax nightmare. No thank you.

Office expenses - consumables, recording devices, cell phone, laptop - they all add up. I’m retired, but have owned and run several businesses before mystery shopping. Most people always underestimate their business expenses and more importantly the value of their time. If you are running mystery shopping as a business I recommend that if you haven’t owned & run a business before add 20% to what you think your costs are... As an aside, I enjoy mystery shopping not running it as a business - more of something to keep me busy and my mind active.

@bgriffin, I'm no lawyer either, but I did not do this on a whim. I got the professional opinions of my financial planner, attorney, and accountant before proceeding. I have moved the vehicle into the LLC, and yes, it does create some tax issues but the accountant deals with those at the end of the year. I keep records for business and personal use of the vehicle. When this idea was proposed to me, I asked about an umbrella policy with a high liability limit and was told I could go that way, but they recommended against it for the following reasons. 1) As I stated in my earlier post, plaintiff attorneys will review your entire financial picture and structure any lawsuit to get as much from you as possible, even if it exceeds your insurance coverage. 2) Setting up the LLC was a one time expense. Paying increased insurance costs due to higher liability limits will cost you more each time you renew your policy. If your in this mystery shopping gig for the long term, you may pay less overall with an LLC.

You're not the first shopper I've heard of creating an LLC for their business. I'm just curious though, and I'm sure the professionals you consulted gave you some examples, but what are some types of liability that you might have as a mystery shopper that the LLC would shield you from?

It's been a few years, but I distinctly remember recounting my story regarding the accident I had at the gas station and all agreed that the LLC would have at least made it more difficult for someone to come after my personal assets if something like that happened in the future. They also asked if I ever conducted shops where someone got fired as a result of my report. They said that an LLC could protect me from someone suing for wrongful termination. The point they stressed over and over again was that insurance would not necessarily protect me in the event of a law suit that exceeded my insurance limits.

@OHGuy wrote:

@bgriffin, I'm no lawyer either, but I did not do this on a whim. I got the professional opinions of my financial planner, attorney, and accountant before proceeding. I have moved the vehicle into the LLC, and yes, it does create some tax issues but the accountant deals with those at the end of the year. I keep records for business and personal use of the vehicle. When this idea was proposed to me, I asked about an umbrella policy with a high liability limit and was told I could go that way, but they recommended against it for the following reasons. 1) As I stated in my earlier post, plaintiff attorneys will review your entire financial picture and structure any lawsuit to get as much from you as possible, even if it exceeds your insurance coverage. 2) Setting up the LLC was a one time expense. Paying increased insurance costs due to higher liability limits will cost you more each time you renew your policy. If your in this mystery shopping gig for the long term, you may pay less overall with an LLC.

I have to assume from this post that you are: shopping full-time, video and route shopping, at very high-paying shops...to justify these expenses. But...didn't you say it was a gas station shop?
Right now, hubby and I are on track to make 3K by the 15th of this month. We did 2k last month, and neither of those months would come anywhere near justifying "a financial planner, attorney, and accountant" -- and I do have a full-time job in addition to MS that pays pretty well.
We are fine with a sole proprietorship, and last year, even with all the MS income, which was substantial, after I finished all the business expenses from two businesses, they still didn't add up to the 12K we got as the standard deduction!

Let me be clear -- I'm asking - at what level of mystery shopping do you justify the expense of hiring the advisors you mentioned? Or do you employ them for another business you own, and mystery shopping is something you do on the side? Otherwise, it just doesn't seem like the math adds up? (Son is an attorney - it's at least $750 to just sit down and speak to them the first time...that's a pretty good shop fee...)

It doesn't matter what you do for a living, if you have assets to protect, you need to protect them.

There is a huge psychological difference in being in business for oneself, or viewing this as a "side gig".

A side gig COULD just be taking a couple highly bonused shops each month because the money is there. Or it could be with a stated goal of earning $250 a month to pay down existing debt.

But being "in business" means self discipline. It means spending SOME TIME (for me, it's every day) at the computer, searching for jobs, reading/answering e-mails. It means keeping RECORDS -- and not sloppy, occasional, erratic records, but detailed, contemporaneous, EXQUISITE records. Whether you like it or not.

It means learning to write an e-mail that says what you mean concisely and precisely.

It means laughing your head off when you write a scheduler and put in the subject line:
XXX shop in XXX town, Nebraska and get a reply: please tell us what shops and locations you are writing about.

It means doing an utterly professional job, even if it's a shop you HATE. Even if they aren't paying you adequately for your work. It means never just "calling it in". That means keeping your promise, being on time, reading the guidelines (I honestly think this is the biggest mistake new and seasoned shoppers make) and getting any conflict or confusion cleared up before you go do the shop -- not just winging it, and hoping it turns out OK. It means if you screw up a shop, you handle it professionally (i.e, no whinging, no blaming someone else, no "it's not FAIR" ) by apologizing (PROFUSELY) and rescheduling/redoing whenever possible -- even if that results in a monetary loss for that particular shop.

It means you don't just "show up" and get paid for being on the clock. It is a totally different mindset.

Many people can't do it. Jobs that would drive me INSANE (sitting on a bench putting the same piece in the same piece over and over and over and over......for 8 hours a day....yuck!) -- but I realize that some people are PERFECTLY suited for that type of work, and they could NOT do mystery shopping.

It means YOU are responsible for all the nasty parts of business no one likes to do (record keeping comes to mind!).

It also means greater personal freedom, to stay home for two weeks if you just don't want to work. It means no job "protection" (i.e, like a union), no guaranteed benefits (you have to start your own IRA, no employee matching contribution to 40l(k), etc.,).

It means constantly learning. Being aware of trends in business and in our industry (for example, the trend toward more and more tech, and how that's affecting us).

And it can be a source of great personal satisfaction.

Edited 1 time(s). Last edit at 05/05/2019 02:14AM by ceasesmith2.

bgriffin should not read this !

Deliberately, willfully, and almost wantonly, I am incurring a travel inefficiency this week. My given travel money for one job could easily stretch to an additional, nearby city and additional job. However, I have chosen to visit each city on a separate day. *gasp!* On each day, this might be necessary if the early job is not early/on time. Regardless of what time I leave home, I will have some free time after work to visit the beloved wide open spaces. This of course, eats into profit. But I Don't Care!!!!! I get wide open spaces, critters, and personal happiness.

It is safe for bgriffin to resume reading this thread now.