mobile-appsI’m currently developing an app for the Apple App Store. I’m currently hung up on the fact that I am unable to choose a custom name under which to submit my app unless I have a business which I can associate the app with.
I’m wondering what the differences are when it comes to cost/monetization associated with going the Business vs Individual developer route?
Obviously the developer account license costs the same regardless of account type, but what sort of business (LLC?) do I need to setup, what are the legal ramifications of doing so, how does monetization through that LLC to me then work, etc? I’ve been unable to find any great articles that touch on these points online, and would love to hear from people that have gone through one path or the other and what benefits and drawbacks they’ve encountered.
Edit: Additional info, I am in the US/California, and I am working by myself
It sounds like you are in the USA and working by yourself, and if that is the case, then an LLC is definitely the company form to use. A one-person LLC is called a single-member LLC.
An LLC is by far the easiest company to create. You file a relatively simple form with your state called a Certificate of Organization. You'll probably read about another more complicated document called an Operating Agreement, but you don't need that for a single-member LLC. Requirements vary by state, but in my state, the cost is $500 per year and I have to file an annual report which is basically the same thing as the Certificate of Organization.
One great thing about a single-member LLC is that it makes taxes and accounting very easy. It is called "pass through" taxation, which means you are taxed as if the LLC didn't exist. Whatever profits you make in a year are taxed at your individual income tax rate plus a self-employment tax.
Paying yourself with an LLC is called taking a distribution. Basically, you just transfer money from your business account to your personal account. You can do this whenever you want, just leave enough in your business account to cover expenses.
For me, one of the main advantages of creating an LLC is that it forces you to separate your personal finances from your business finances. You create a separate bank account for the LLC and maybe get a business PayPal account and credit card as well. This makes your accounting and taxes much easier at the end of the year.
An LLC also provides "limited liability". You can read more at that link, but basically if someone ever sues your company, they probably can't go after you as an individual (e.g., they can't take your house).
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