Currently work as an engineer for a company and i realized that some of the skills i have picked up are definitely sought after. Most of the opportunites are things my current company does not want to involve itself in (one offs and small stuff). I'm considering starting my own company to work afterhours and weekends on some of these projects. (AFTER I HAVE FIRST CLEARED WITH MY COMPANY THEY DO NOT WANT THE JOB). I would appreciate any advice you could give on what i need to consider before i jump off the ledge.

Function would be design of vessels and compressors or stations.

Obviously i'd need to have insurance
Would also need a CPA.
Based on everything i know LLC would be the way to go here (please correct me if i'm wrong)

What big items am i not thinking about?

Thanks
MMETAG10

Just the basic description seems like a potential or even perceived conflict of interest to me and would be nixed quickly.

Vessel fabricators are a dime a dozen
Compressor packagers operate on very low margins

Yes my current manager has no problem with it but i would ask further up. But i appreciate the comments.

Do you have/need your PE license? And if so, do you need it in additional states or are the rules different in other states?

As to the meat of the question:

LLC is kind of the default new small business type these days. It gives you legal protection as long as you didn't perform in a negligent manner. From a tax perspective it's an extension of you just as if you never created the LLC. A single owner LLC is called a Disregarded Entity in the IRS' vernacular and files a Schedule C on your personal return just as a Sole Proprietor would. A CPA is going to charge you for your personal return and that Schedule C as separate entities. Still it's a good idea to have one.

Get a separate checking account for the business and separate the money from your personal money. The business can't grow if you're sucking out all the cash. Same answer for a credit card. Even if it's a personal card use a separate one for the business.

Do you need insurance? I don't know anything about your industry so I can't answer that. Couple of brokers on here can give good advice on that.

Keep a set of books. Again I don't know your industry so I don't know if that's a spreadsheet because it's so low volume that it works or if you need a QB Online or Xero subscription but keep track of what's happening real time. September of this year isn't the time to be doing 2021 accounting. Your CPA will thank you.

I see what's posted above, and you definitely need a LLC, possibly an S Corp. Need to find a way to offset revenue with your business expenses to minimize your tax burden. I'm not a tax guy, I'm an engineer with similar set up.

Thanks for the replies. I do not have pe license but to my knowledge it's not necessary/ i have a friend i could pay to approve if necessary. I would carry insurance but like i said I'm super early and just considering it. No decision has been made. I appreciate the banking advice. Had planned on a separate bank account but hadn't thought about the need for a separate credit card for expenses.

I'd vet the license issue before going much further. If a license is required it's not as easy as paying a friend to review/stamp. Your LLC would need to be registered with the state which could add some complexities if your not licensed.

Mmetag10 said:

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Thanks for the replies. I do not have pe license but to my knowledge it's not necessary/ i have a friend i could pay to approve if necessary. I would carry insurance but like i said I'm super early and just considering it. No decision has been made. I appreciate the banking advice. Had planned on a separate bank account but hadn't thought about the need for a separate credit card for expenses.

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You need to just stay employed.

If you're having to check with your company on a job by job basis to see if they want the work or not…that's too close. They likely won't go for it. If it's a small enough company, maybe.

Decided not to pursue.