Thoughts on jeweler becoming an LLC


One area we haven’t talked much about has been our business models. We cover such a broad spectrum of involvement in the craft that perhaps it is difficult to compare each to the other. After years as a designer of spaces for handicapped access I have retired and more time will be dedicated to the business of jewelry. I am looking for a greater exposure to the market. I have a business plan which I advise everyone to have as it creates a road map of sorts. But one area I am a little in the dark about is the legal status of my business. I have a DBA and sales tax number for New York State but I am wondering why I would wish to add an LLC to my business name.

I believe I have had as many people tell me it isn’t necessary as I have had tell me to get one immediately. I suspect, perhaps wrongly, that each state has its own rules regarding the Limited Liability Corporation. I can see how there are benefits to the protection one offers but do we as jewelry makers, crafters, or goldsmiths have much exposure to liability that wouldn’t be covered under regular insurance? As I am a sole proprietor will I need a different type of bookkeeping? Do I have a greater exposure to business liability as I have a second business as a musician and I need to keep the businesses separated.

Any thoughts on this subject?

Don Meixner

My state’s Dept. of Revenue requires a business checking account number in order to get a sales tax number. And they can freeze that account if necessary. Therefore, no revenue from other sources goes into that checking account. In order to get a business checking account, the Bank requires me to have an LLC, INC, or partnership, not a DBA.

Find out what an insurance company might require if you need additional coverage for your business, such as liability coverage at your selling venues. Theft insurance is easy to obtain, but obtaining liability insurance is different. I’m thinking about the person who trips on your carpet at a craft fair and sues you.

Having an LLC might be helpful in that situation, although, to have any hope of being protected by your LLC, you need to act like a business, with a business checking account and always using the letters LLC after your business name.

Regardless of what you decide, at the very least, you need to keep separate records for separate businesses, otherwise, there is no additional bookkeeping.

Thanks for the reply. What state are you in Betty?

I don’t want to share my location on a public forum, but I have a general idea where you are give or take a couple of hundred miles, and I think I’m about 800 miles from you.

Hi Don,
A bit more about your business model would help. Because it looks as tho your starting out with a 3rd! career having retired just from one.
One needs to start from where you plan to sell your work assuming its not going to be just a hobby.
If like me you never have enough time for everything, then selling wholesale is not the way to go.
It has to be retail. This way you make the profit on the design production and sales, no middle men!.
So,where have you thought you would do this?
Craft fairs, or other venues where individual applied art makers sell their work?
Then go and ask them if they have this limited liability corp status as well as the DBA… Here in the uk its never required nor nessesary for a sole proprietor unless your going to mass produce, sell to big chains and have proper terms of business based on contracts etc.
I presume your sales will be on a one to one basis between you personally and your customer.
Also look at why the top people use their own name, which a DBA does not require you to do so,
Here in the UK all the top jewellers trade using their own names apart from the legal requirement of our hall marking assay laws that require the establishment of a registered mark that has to go on all work.
If what you plan to make is fit for purpose, carefully researched to ensure theres no risk of injury to the buyer/ and/or wearer from your work you really dont need to have a company or LLC. ,
This LLC is the accepting body for any claims against it with you being just an employee of that Co.
Here thats Ltd. and Germany GMBH.
That is separate from having 3rd party insurance for your exhibition unit what ever that might be, and as Betty 2 said a claim for tripping over your expo carpet, dont have one!
Most show organisers have to have public liability, and that usually extends to cover the exhibitors.
Thats different again for say a steam rally, where you wont get your passes to take part unless you have forwarded copies of your valid steam boiler test certificates if your showing live steam. If your showing just your jewellery work you dont need a steam test cert! Ive done well at big steam rallies. Here in Dorset we have the world’s largest with 50,000 people over the 5 days.
Here for example if your selling in a market you have to have a market traders public liability policy,
if the stall blows over! ,tho no product liability cover. If im demonstrating my work I also need this type of policy as ive oxy, propane,tools,electric motors, and the medium drop hammer on demonstration, all securely fenced off! of course.
Suggest you do some research that matches how you plan to operate from people who are doing what you plan to do.
Will save you a lot of time!.
Ive been at this game now for 50 yrs always a sole proprietor , filing every year a proper set of
accounts to our inland revenue.
Here are a lot of benefits to this, like writing down machinery, all costs rent rates heating travel etc.
In many yrs never paid any tax at all. tho the tax man would love to know how you can live without any income. there not stupid.
Look forward to hearing how it works out.

I’m also in NY state, so I thought I’d chime in. I am currently in the process of incorporating after having been a sole proprietor for 13 years. My jewelry is my sole income and has been for about 6 years (plus the occasional teaching gig.) My accountant always advised me that at my income level it was kind of a wash whether or not to incorporate- it wasn’t going to save me any money, and with what I do and what I own I wasn’t terribly worried about the liability protections. However as of 2018 that has definitely changed. Our new tax laws have made it a clear choice for me to become a legal “pass-through” entity. After going over the options with my accountant, I decided to become an S Corp, but an LLC is not that different.

I’d say you should definitely consider the recent tax changes when making this decision. As far as the day-to-day I don’t really need to do anything differently, as I always kept my business money separate and “paid myself” to another account. I have also always kept excellent receipt records. However, as an incorporated business these things are necessary, so it could be a shift in how you handle your monthly/weekly book keeping if you need to create new habits.

Good luck!

I forgot to mention above- I have also purchased event-specific insurance as needed in the past. That is all separate from being a limited liability corp. Incorporating just prevents people from being able to go after your personal assets, and rather only after the business in the event of a legal judgement. If I owned a home or had large investments, I would have probably incorporated long ago to be cautious.

@DonMeixner I had a subchapter S corporation some years ago.

Betty was right that you need to act like a business, but she didn’t go far enough.

If you have a corporation, subchapter S or LLC, you have to run it like a corporation. Have to as in ’must’. You need to hold ‘meetings’, keep minutes, whatever else your lawyer says you must do as a corporation, or you do not in fact have a corporation, you are just a sole proprietor making believe you have a corporation. It won’t matter until you are challenged and required to document that you are in fact running a corporation.

Having a corporation makes you the president. The difference between a corporation president and a jeweler with a corporation is the the president of a larger corporation was hired to do the job, and he / she wants to be a corporation president. In the case of an LLC jeweler, you are not a corporate executive who wants to do that work, you want to make jewelry. You will not think or act like a corporation president, you will act like a self-employed jeweler, and in that way you will run the risk of being declared not a real corporation if challenged (by someone suing you or by the IRS perhaps).

A main reason for an individual to have a corporation to limit your liability is to not lose your house and savings if someone sues you. The person who sues you will not be an individual, it will be his / her lawyer. Lawyers know full well individuals having a corporation almost never do it right year after year, and that lawyer will know to challenge the legitimacy of your LLC, to get all they can from you.

I’m just someone who once had a limited experience with this, years ago. You need to sit down with a lawyer and find out all the details in your state, for these days. you need to find out how to deal with ‘meetings’ and minutes, and whatever other requirements there may be, some of which may seem nonsensical to you - how do you hold a meeting with just you? How do you send out notices of the meeting? (Hold meetings with your lawyer…)

You need to do it right, or it won’t count when you need it to.

Neil A


The meeting requirement is actually “Board Meeting Minutes” and they are not needed for an LLC because there is no Board of Directors. The structure of an LLC only has members, and most States allow there to be only one member of an LLC, as well as the possibility of an unlimited number of members.

The requirement about meetings is only for C corporations and S corporations, which must have officers. These people do not need to have anything to do with your business, although they need a title like “corporate treasurer” or “corporate secretary”, and you need them to sign documents occasionally. They need not own stock in your company, nor do they need to be able to do anything except sign their name and they can be anyone, like your spouse, sibling or friend.

Meeting Minutes can be about anything, such as “All officers are in agreement that we should buy a rolling mill.” Then you list the names of the officers who are “in attendance at the meeting” date it and have all officers sign it.

You can manage the meeting minutes in a casual way, just don’t ever admit it. For example, your Board Meeting Minutes could be written by you and then later get your Officers to sign them as if they were present during the meeting. After all, they may not have anything to do with your business. But do this only if your Corporate Officers will never mention their “do-nothing” status.

The point of the meeting minutes is to show that you are acting like a corporation where officers exist to protect the interests of the stockholders.

While many folks use attorneys to create the Form of their business and to help with meeting minutes, it is not necessary. You can do it all youself. The only time consuming thing an Attorney does is a search on your business name, just to be sure you are not using a business name that is already taken in your state. In my state, the Secretary of State has a website which shows alphabetically every legal business name in the state. If your state doesn’t put it on the net, you can get the information by contacting your Secretary of State.

The “limited liability” is the entire reason why the business form “LLC” exists. Sole proprietors complained for many years that it was not fair for corporations to enjoy a “Corporate Veil”, while a sole proprietor had no protection in a lawsuit. Therefore, the LLC form of business was created to even the playing field for small businesses.

The “Limited Liability” of an LLC, and the “Corporate Veil” of a corporation are not a sure thing. But tending to these requirements that take very little time can make a positive difference if your company is ever in litigation.


Ha! I knew Betty knows whereof she speaks. :slight_smile:

… just don’t ever admit it.

Yes, my lawyer said as much. That works until it doesn’t.

The only time consuming thing an Attorney does is a search on your business name…

Mine flubbed it, didn’t get it right until after I had all the stationery printed.

Neil A

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I have heard other folks complain about how their attorney did not do the name search, which ultimately was revealed when another company sent them a “Cease and Desist” letter!

Happy to chime in to the extent this is helpful. The advice above to seek appropriate counsel (either that of your accountant and/or of an attorney licensed in your state) is good advice. Every state is different.

However, from a federal tax perspective, one issue you may wish to consider when forming a pass-through entity is whether that entity will need to file its own tax return.

Single-member LLCs are “disregarded” – meaning you can have only one member, avail yourself of the liability protection, but not have to file a separate tax return for the business (income and expenses just go on your schedule C).

Multi-member LLCs are not disregarded, they file their own return.

For all intents and purposes related to tax (not liability), a single-member LLC and a DBA are the same thing.

You can even have both if you want to :slight_smile: For example, International Gem Society, LLC (which my wife Lisa I own and operate) is the same entity that owns the Ganoksin Project. So, IGS, LLC is DBA “The Ganoksin Project” I only have one layer of liability protection, but that’s all I need because Ganoksin is under/owned by the IGS entity. This eliminated the need for me to have two entities and the expense associated with same, for an entity that (I know this is going to shock everyone - haha) is lucky if it breaks even every year.


Hey Don- long time member- have not posted in a loooong…while… If you dont mind another thought process coming into play- I’ll share a bit of advice.

-For clarification- my wife is a CPA- I am a long time small business supporter and owner. Jewelry is NOT my primary career. I live in a “commonwealth” state in the USofA. That ALL being put out there so you know what direction I come from- here goes.

Im going to quote your original post then place my response in line to address your items and then propose another perspective for your consideration.

DON<< I have a business plan which I advise everyone to have as it creates a road map of sorts. But one area I am a little in the dark about is the legal status of my business.>>

REPLY- Bravo for the business plan- I see a LOT of folks go into things without a map, and the plan is definitely a good course of action. If you have NOT considered getting your business plan looked at for soundness- I would recommend it. How? Hey I’m glad you asked!
-Go to and use the business plan template there to write or re-write your business plan… Why? Because it is already in the format banks or venture capital groups use and is plain, straight forward and as you fill it out may bring up questions you may not have considered. The caveat here is these guys are FREE- and there are LOCAL chapters in every state. I have even used their online mentor program (Free as well) and received very sound advice.

DON- << why I would wish to add an LLC to my business name >>

REPLY- Short answer- because you can be accused of “copying/rendering or adultering another persons idea for your own financial gain” according to the law. It is all about a person/companies PERCEPTION (not always a reality based fact) of a threat to business or market-share. This can/will tie your finances up, cause lost time and craft, and could potentially disrupt the business long enough to kill it. Big names like David Yurman (Torques in particular) have gone after other artisans and effectively killed them by dragging out a financial case over a long period of time. I hate putting names to cases- but just google trademark infringement lawsuit ______ (add company name) and see.

For this portion of the reply, apologies… its a long one- sorry- thank DAVID GELLER for putting these ideas into my head years ago! (HA! thanks to Dave’s older mailings my metalwork went into analysis mode and my efficiency went up)

-Liability protection is the avenue a lawyer will go down for all things- that being said a CPA will direct you down the path of financial security in general. You can do both. the key element is CRAFT YOUR MARKETING PLAN ACCORDINGLY.

Jeeze- you mean another layer to the puzzle? Yup. The act of creating a marketing plan with growth and expansion benchmarks/targets will force you to see “down the road” to avoid things like Cease and desist" letters- but MORE importantly it will allow you to craft your business and tax advantages around where you are in your marketing plan.

Starting out- Most artists create branding that is associated with the name/personal style or codex of skills they bring to the craft- it adds an air of personality with the knowledge that if your name is on it- its personal. Good and bad- If you ever want to branch out- not many folks named Frank want to buy “Dons” jewelry store… so long term outlook here- Start personal and with the goal of 100% personal service.

But- this “starting out” is also your space to find out what niche/arena and focus you bring to the industry… its NOW you need to be thinking big- and preparing for that eventuality. So- LLC? Sole Prop? LLP? If you are afraid your product can/will get you sued then at this point go for liability protection.

As you grow, your needs will change. Use your marketing plan to define and identify when those points are upon you.

Beginner- Sole Proprieter… Got a few annual craft shows under your belt and have a small line or production that you wholesale? Think about an LLC… Got a student/apprentice or like to teach? Then explore S-Corp (mostly for injury/liability and financial insulation from accidents or employees/workers)

DON-<< As I am a sole proprietor will I need a different type of bookkeeping? >>

REPLY- You will need specific book-keeping for EACH separate entity- the key here is no (can I stress it again- NO) co-mingling of funds (please read this again- NO co-mingling)… dont even put a pack of chewing gum for yourself on the business account… The moment you co mingle- the fiscal liability for debits and legalities to the business become a household item… and any other hobbies/crafts/activities should be their own- you dont want to tie your house to a lawsuit.

DON- << Do I have a greater exposure to business liability as I have a second business as a musician and I need to keep the businesses separated. >>

REPLY- All business should be separated financially and each should have their own audit/control and financial reporting. Sounds daft- but it will protect you from any “gray areas” of interpretation on the IRS/State or in my case the municipality.

Let me explain this- a business exists to make money or grow to a profit level. Tying your music to the jewelry may be seen as a tax-dodge to some folks. In my case I had a foundry for casting (investment and greensand) as well as another business doing property maintenance. They were separate. In addition I had my fabrication (jewelry) metalworking business.

Yes- I was audited. I was able to show each existed separate from the other with books and financial reporting and seperate accounts (no co-mingling). The trigger for the audit was the “Appearance” of tax-dodging with the casting versus the fabrication. I was able to show via timelines, business plans and marketing plans the direction of each business being independent of the others (although all were housed in my one business address).

So if you are still reading- good on you! My advice:
1- Go to and do the templates
2- Get the free counseling/mentoring
3- Build the MARKETING PLAN along with the business plan to know when it is time to grow/change your tax-structure
4- No co-mingling of funds
5- Make lots of jewelry and have FUN!

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YouTube video, look up
Creating An Amazing Texture Using
Silver Reticulation Techniques

 I do hate his use of red acrylic resin...

Thanks Kerri,

That is exactly the information I was hoping to find. I am sure that there are some variations that will occur because each state is a little different.

Thanks again

Such good advice. I checked out the SCORE website and wish I’d seen it 25 years ago. Exit strategy for a small business is one area I did not find much info. As I am getting to that point, I’ve been giving a lot of thought to how I can best handle the end game. For instance, I can always send in the sheet, wire, etc. to a refiner, but that seems like a shame to melt such items when someone could use them. What about the stock of pieces ready to sell - again, candidates for the refiner or invest the time in finding an outlet.

Anyone in the same quandary?

Judy in Kansas, who is watching a lovely snowfall. Not planning to go sledding or anything. Just made a nice beef stew to enjoy later.

Hi Judy, the end game? it will come to all of us some time or other.
Here in the UK, the general rule is it gets known in the hand making trade that so and so is retiring and all the tools, materials etc are dispersed to others in the trade.
I cleared out a drop stamper back in 1987, he was only 63, not well died 6 months after I had all his wonderful kit. Around 5 tons of the stuff.
And made a very good living from the tooling not normally available . It included tooling dating back to 1851!

i often wonder , those who exit the trade, die shortly afterwards, because
it was their pride and joy, their driving force. what tehy created, was in
essence, them.

I completely agree with you. Many years ago I read a book which said “Never Retire! Move on to something related but different.” At 78 (today!) I completely agree. When you get to the point you don’t want to solder another bezel, find something new. I moved to Mexico and started studying Spanish and living in a new culture. In my book, it’s really paid.
Dick Stromberg
Ah Mexico! Where “C” on a faucet means HOT, and “M” on a restroom means THE LADIES ROOM.

January 23 |

i often wonder , those who exit the trade, die shortly afterwards, because
it was their pride and joy, their driving force. what tehy created, was in
essence, them.


Even though an exit strategy essentially means selling, donating or doing nothing, perhaps most important is closing accounts.

If applicable, terminate the business registration with the Secretary of State, and close the sales tax account with the Dept. of Revenue.

A useful way to begin an exit strategy is to make a list of assets and assign a value to each item or group of items.