Should I Start an LLC for My Dog Training Business?

Starting a limited liability company (LLC) for your dog training 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 a dog training business, lawsuits can arise from things like failure to train a customer’s dog properly or an employee using training techniques that end up worsening a dog’s aggression.

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

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

Do I Need an LLC for a Dog Training Business?

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

You should start 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 a Dog Training Business

By starting an LLC for your dog training 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.

Dog training businesses will benefit from liability protection because animal training and service businesses, including dog training businesses, face a variety of risks associated with guests visiting your business location and customers entrusting your business with the care of their dog.

Example 1: When a customer complains that you failed to adequately train their dog, they demand you give them a full refund. When you refuse, they file a compensation claim against your dog training business. Since you are registered as an LLC, your limited liability will ensure that the claimant cannot sue you personally.

Example 2: You decide to hire a few specialized dog trainers to help you out. Since their employment contracts were drafted between your LLC and themselves, they will not be able to sue you personally if your business cannot pay them in the future.

Example 3: When your business is unable to pay back a loan on time, you worry that the creditor will sue you personally in order to recoup their investment. Since your business is registered as an LLC and you didn’t personally guarantee the loan, your personal assets will remain entirely protected from the lender regardless of whether your business is unable to pay them back.

Example 4: During a training session at your dog training practice location, an unsupervised dog trips over a platform and sustains a leg injury. The dog’s owner asks you to cover the resulting veterinary fees.

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 a Dog Training 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 a dog training 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

Dog training 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 dependable 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?

Most LLCs are not legally required to purchase business insurance unless they hire employees.

Having said that, getting business insurance is generally highly recommended as it is the only way an LLC can protect its business assets (e.g., land, website, etc.). This is because the limited liability offered by an LLC protects its owner's personal assets only, not the business’s.

Common Situations Business Insurance May Cover for a Dog Training Business

Example 1: During a training session at your place of business, a dog owner trips on some uneven ground, breaks an arm in the resulting fall, and demands your business pay for her medical treatment. General liability insurance would pay for her medical care.

Example 2: A competitor files a lawsuit against your business, claiming you libeled her company in your last marketing campaign. General liability insurance would cover your legal defense costs.

Example 3: While conducting a dog training session at a client’s home, you walk through the living room, trip over his cat, and fall into his entertainment center. The client demands you replace his broken equipment. General liability insurance would cover the cost of replacing the client’s damaged property.

Other Types of Coverage Dog Training 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 dog training businesses should obtain:

Professional Liability Insurance

While you work hard on behalf of your clients and their dogs, there’s always a chance someone might claim your professional services caused them harm. If a customer claims you made a mistake — whether you actually made an error or not — and sues you, professional liability insurance would cover your legal fees and any required settlement.

Commercial Auto Insurance

Any vehicle 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 materials you carry in your vehicle.

Workers’ Compensation Insurance

Most states require businesses to carry workers’ compensation insurance for their part-time and full-time employees. 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.

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.

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.

Read our Business Insurance for Dog Training Businesses article for more info.

You can start a dog training business on a relatively low budget, especially if you are qualified to train the dogs yourself and do not need to hire specialized instructors. Like most service-oriented businesses, you will need to invest in a business website, solid internet connection, work computer, and business phone in order to interact with your clients.

Visit our How to Start a Dog Training Business guide to learn more about the costs of starting and maintaining this business.

Some of the main ongoing expenses will include the cost of rent and utilities for the business location as well as the cost associated with renewing training certifications.

Learn more about running a dog training business.

Profit is made by charging clients varying rates for dog training services. Clients may be charged for ongoing classes or specific services for their dog such as grooming, walking, or pet-sitting.

Learn more about starting a dog training business.

Dog training businesses are critical for helping owners to train their dogs to behave. Dog training businesses may have physical locations, or they may work on the move by visiting clients and their dogs in their own homes.

Dog training businesses vary in profit level based on the number of clients they have and the number of services offered to their clients.

Learn more about starting a dog training business.