Should I Start an LLC for My Aquarium Maintenance Business?

Starting a limited liability company (LLC) for your aquarium maintenance business can provide several benefits.

Most importantly, an LLC structure offers limited liability to its owners, which can protect their personal assets from lawsuits and creditors.

For an aquarium maintenance business, lawsuits can arise from things like not adequately testing water levels while conducting a routine cleaning causing the loss of valuable fish and coral, or an employee getting injured while installing a new tank.

LLCs are also affordable, highly flexible (from a tax point-of-view), and can make your aquarium maintenance business seem more credible.

Recommended: Use Northwest to form an LLC for $29 (plus state fees).

Do I Need an LLC for an Aquarium Maintenance Business?

LLCs are a simple and inexpensive way to protect your personal assets and save money on taxes.

You should form an LLC when there's any risk involved in your business and/or when your business could benefit from tax options and increased credibility.

LLC Benefits for an Aquarium Maintenance Business

By starting an LLC for your aquarium maintenance business, you can:

Protect your savings, car, and house with limited liability protection
Have more tax benefits and options
Increase your business’s credibility

Limited Liability Protection

LLCs provide limited liability protection. This means your personal assets (e.g., car, house, bank account) are protected in the event your business is sued or if it defaults on a debt.

Aquarium maintenance businesses will benefit from liability protection because of the risk of personal injuries, property damage, trademark infringement, and libel of other businesses.

Example 1: When undertaking a routine cleaning, an employee of your aquarium maintenance business forgets to test the water, which kills the client’s fish as a result of the excessively high ammonium and nitrate levels. Due to limited liability protection, if the client sues your business for this property damage, any compensation the court may ask you to pay can only be imposed upon business assets.

Example 2: While installing a new tank, one of your employees trips up, causing the heavy tank to fall on the client and break both their arm and the item. As a consequence, the client thus sues your aquarium maintenance business for this property damage and bodily harm. If you are found liable to pay these damages, your personal assets will be safe from the lawsuit.

Example 3: A customer purchases a tank cleaning from your aquarium maintenance business, believing it to be an extremely premium cleaning as a result of your marketing. Consequently, the customer grossly overpays and feels they have been deceived - so sues your business for misrepresentation. Limited liability protects your personal assets during the lawsuit.

Example 4 : While an employee is performing maintenance on a client’s aquarium, they accidentally crack the glass, causing water damage to the surrounding furniture. The client sues your business for the damages.

An LLC will also protect your personal assets in the event of commercial bankruptcy or loan default.

To maintain your LLC's limited liability protection, you must maintain your LLC's corporate veil.

LLC Tax Benefits and Options for an Aquarium Maintenance Business

LLCs, by default, are taxed as a pass-through entity, just like a sole proprietorship or partnership. This means that the business's net income passes through to the owner's individual tax return.

The business’s net income is then subject to income taxes (based on the owner's tax bracket) and self-employment taxes.

Sole proprietorships and partnerships are taxed in a similar way to LLCs, but they do not offer limited liability protection or other tax options.

S Corp Option for LLCs

An S corporation (S corp) is an IRS tax status that an LLC can elect. S corp status allows business owners to be treated as employees of the business (for tax purposes).

S corp tax status can reduce self-employment taxes and will allow business owners to contribute pre-tax dollars to 401k or health insurance premiums.

The S corp status requires that the business pay the employee-owner(s) a reasonable salary for the work they perform.

In addition, the business might need to spend more on accounting, bookkeeping, and payroll services. To offset these costs, you'd need to be saving about $2,000 a year on taxes.

We estimate that if an aquarium maintenance business owner can pay themselves a reasonable salary and at least $10,000 in distributions each year, they could benefit from S corp status.

You can start an S corp when you form your LLC. Our How to Start an S Corp guide will lead you through the process.

Credibility and Consumer Trust

Aquarium maintenance businesses rely on consumer trust. Credibility plays a key role in creating and maintaining any business.

Businesses gain consumer trust simply by forming an LLC.

A growing business can also benefit from the credibility of an LLC when applying for small business loans, grants, and credit.

Northwest will start an LLC for you for just $29 (plus state fees).

Get Started

How to Form an LLC

Forming an LLC is easy. There are two options for forming your LLC:

You can hire a professional LLC formation service to set up your LLC for a small fee
Or, you can choose your state from the list below to start an LLC yourself

Select Your State

For most new business owners, the best state to form an LLC in is the state where you live and where you plan to conduct your business.

Do LLCs Need Insurance?

All LLCs should own insurance. Although the business structure provides built-in protection for the personal assets of its owners through limited liability, business assets remain unprotected.

Hence, LLCs buy business insurance to make sure that the assets they own are similarly protected.

Common Situations Business Insurance May Cover for an Aquarium Maintenance Business

Example 1: While performing aquarium maintenance in a client’s home, you trip over your vacuum cable and fall into the client’s entertainment center — smashing a large television and several other pieces of equipment. General liability insurance would cover the cost to repair the client’s damaged property.

Example 2: When your employee performs maintenance on an aquarium in an office building, he accidentally knocks over one of your client’s employees and causes her to break a wrist. She sues your business for her injuries. General liability insurance would cover your legal costs, including any settlement.

Example 3: A competitor claims your latest advertisement libeled his business and decides to sue. While you disagree with the accusation, you need to hire an attorney immediately. Your general liability policy will pay for your legal representation and any awarded settlement.

Other Types of Coverage Aquarium Maintenance Businesses Need

While general liability is the most important type of insurance to have, there are several other forms of coverage you should be aware of. Below are some other types of insurance all aquarium maintenance businesses should obtain.

Professional Liability Insurance

While you strive to help your clients maintain complex marine ecosystems in their homes or businesses, there’s always a chance one might decide your professional services caused them harm. If a client files a lawsuit, professional liability insurance would cover your legal fees and any required settlement.

Commercial Auto Insurance

Any car or truck you use primarily for business requires commercial auto insurance to protect the vehicle, driver, and others on the road in the event of an accident. Be sure to select a policy that covers not only accident-related vehicle repair costs and medical treatment for anyone injured, but also sufficient protection for any business equipment and supplies you carry in your vehicle.

Commercial Umbrella Insurance

While your general liability insurance policy covers most claims, some accidents or lawsuits may be so catastrophic that they threaten to exhaust the limits of your primary coverage. Commercial umbrella insurance protects you from paying out-of-pocket for any legal fees and awarded damages that exceed your primary policy.

Workers’ Compensation Insurance

If you have any employees, most states will require you to carry workers’ compensation insurance for both part-time and full-time workers. This coverage protects your employees if they become injured at work or fall ill after a work-related accident. It not only covers an employee’s medical bills and lost wages if they need time to recover, but also any disability or death benefits stemming from a work-related accident.

Should I Start an LLC FAQ

Choosing the right business structure depends on your business’s unique circumstances and needs. However, unless your business is very low risk (like a hobby), an LLC is likely the better option.

Visit our LLC vs. Sole Proprietorship guide to learn more.

At a minimum, you’ll need general liability insurance, workers’ compensation insurance, and commercial auto insurance.

Read our Aquarium Maintenance Business Insurance article for more info.

You can expect the startup costs for an aquarium maintenance business to be minimal. The largest expense is likely to be your vehicle and office/storage space.

Your startup costs also include insurance premiums, marketing costs, and necessary aquatic equipment.

Visit our How to Start an Aquarium Maintenance Business guide to learn more about the costs of starting and maintaining this business.

Ongoing costs include vehicle maintenance, fuel, insurance premiums, advertising fees, and supplies.

Learn more about running an aquarium maintenance business.

An aquarium business charges clients for aquarium maintenance and cleaning, either based on a flat fee or an hourly rate.

Learn more about starting an aquarium maintenance business.

An aquarium maintenance business provides maintenance, cleaning, and occasionally repair services for both individual and commercial clients.

The amount of profit an aquarium maintenance business can make depends on the number of clients it has, how much it charges per client, and its overhead costs.

Learn more about starting an aquarium maintenance business.