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Guy at my cousin's BBQ in Phoenix said my HVAC shop could bill as a 'consulting' LLC on a 1099, and now I'm second guessing everything
I always figured that was just internet nonsense until he pulled up three years of his own invoices on his phone and showed me the exact contract wording his lawyer used. Anybody here actually structured a small trade business this way, or is it the kind of gray area that gets you a letter from the state 2 years later?
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emmaking11h ago
Laughing because I did the exact same thing after a guy at a job site told me to switch my whole setup to an LLC and bill everything as "consulting." Spent a whole weekend googling tax law like I was about to pass the bar exam, and by Sunday night I knew less than when I started. Here is the thing though, calling HVAC work "consulting" on paper does not change what the work actually is, and the state and IRS look at what you did, not what you named it. If you are doing installs and repairs, that is contracting, and the license and insurance rules still apply no matter what the invoice says. His lawyer may have set it up so the contract wording is clean, but that does not mean it holds up if someone audits him or a customer gets hurt on a job. Guys show off three years of invoices like it proves something, but a lot of folks get away with stuff right up until they don't. Talk to a real CPA in your state before you copy what some guy at a BBQ does, because the letter two years later is a real thing and it is not cheap.
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