Last Updated: May 10, 2024, 12:25 pm by TRUiC Team

Should I Start an LLC for My Flower Shop?

Starting a limited liability company (LLC) for your flower shop 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 flower shop, lawsuits can arise from things like misrepresentation claims, false advertising allegations, or personal injuries (e.g., a customer suffering an allergic reaction to improperly labeled flowers, etc.).

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

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

Do I Need an LLC for a Flower Shop?

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 Flower Shop

By starting an LLC for your flower shop, 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.

Flower shops will benefit from liability protection because of the risk of trademark infringement, financial data breaches, and workplace accidents. 

Example 1: A customer sues your flower shop for selling them a bouquet of flowers that caused an allergic reaction. If found guilty, liability protection will ensure that your personal assets remain protected from any fees associated with the lawsuit.

Example 2: A customer sues your flower shop for delivering the wrong bouquet of flowers to their wedding, causing them significant stress and inconvenience. LLC structure will protect your personal assets from being used to pay for any damages or legal fees, even if the business is found to be liable.

Example 3: A customer sues your flower shop for failing to deliver their order on time, causing them to miss an important occasion. Regardless of the court’s ruling, only your business’s assets will be affected and not your personal assets.

Example 4: A customer purchases a flower arrangement that unknowingly contains a plant that they are highly allergic to. They ask you to cover the resulting medical expenses.

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 Flower Shop

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 flower shop 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

Flower shops 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 loansgrants, and credit.

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

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?

All businesses need insurance to protect their business assets — even LLCs. This is because the limited liability protection from an LLC protects your personal assets, not your business assets.

Insurance can help to safeguard your flower shop’s assets and protect against the financial impact of a lawsuit or other unexpected circumstances.

Common Situations Business Insurance May Cover for a Flower Shop

Example 1: A customer is admiring a potted flower when a venomous spider crawls out of the pot and bites them on the hand. The venom is non-lethal, but the wound later becomes infected. It is a rare occasion in which fairly serious medical intervention is required. If held liable, general liability insurance would probably help cover any court-mandated medical payments.

Example 2: A customer purchases a large plant in a big ceramic pot. He insists he can carry it himself, but he trips over the door frame while moving backward, dropping the heavy pot and breaking his shin. If found liable, general liability insurance would likely provide coverage for a resulting settlement or medical payments owed through a court ruling.

Example 3: You show a customer one of your latest imports, a special exotic flower that has recently become popular in the US. The customer touches and smells the flower and suffers a severe allergic reaction. Rapid swelling causes her to asphyxiate before an ambulance can arrive and administer adrenaline. If her bereaved spouse took your business to court, your expenses would probably be covered by general liability insurance.

Other Types of Coverage Flower Shops 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 flower shops should obtain:

Commercial Property Insurance

A flower shop may sell a variety of accessories, but its core inventory is a collection of flowers and other flora. Plant life requires attention, care, and even some cosmetic maintenance like pruning. Such delicate products are highly vulnerable to disasters like fire and violent weather. Keep your sensitive inventory covered with a commercial property policy. Owned real estate is also covered under this insurance, allowing many businesses to get back on track after destructive natural forces push them off course.

Business Interruption Insurance

Similar to commercial property insurance, the purpose of this policy is to provide coverage for businesses that have suffered serious setbacks due to factors like fire, tornadoes, or other disasters causing storefront destruction. Business interruption insurance can help cover estimated losses in revenue during a temporary shutdown as well as any relocation costs. This type of insurance is commonly offered as part of a business owner’s policy, and it can make the difference between permanently shutting down your flower shop and suffering what is ultimately a minor setback.

Home-Based Business Insurance

One of the advantages of a flower shop is that it can be run from home. You can use your own garden and/or greenhouse to grow a commercial collection of diverse flowers and other plant life. But as convenient and comfortable as it can be to run a business from home, homeowners’ insurance might not cover various business-related accidents or inventory damage. Home-based business insurance is your solution, delivering peace of mind as you run your flower business.

Workers' Compensation Insurance

As businesses grow, they pick up more inventory, locations, and human resources. Whether you are starting off a business with multiple employees or taking a solo business to the next level, this is a policy you’ll need to keep your workers covered. In fact, any business with part-time or full-time employees is required by law to provide workers’ compensation insurance. With this insurance, your employees and their families are covered in the event of work-related accidents and/or fatalities.

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 and commercial property insurance.

Read our Flower Shop Business Insurance article for more info.

The typical costs to open a flower shop range from $10,000 to $50,000 and may include expenses for storage, location, initial flower and supply orders, a delivery fan, and potential employee wages.

Visit our How to Start a Flower Shop guide to learn more about the costs of starting and maintaining this business.

Operating expenses for a flower shop include rent, buying flowers, potentially payroll, and vehicle expenses.

Learn more about running a flower shop.

A flower shop makes money by selling individual flowers as well as flower arrangements.

Learn more about opening a flower shop.

Flower shops specialize in selling flowers creating custom arrangements for customers. Some flower shops may also provide pots, fertilizer, and other plant-related materials.

While flower shops can start fairly small to reduce costs, they still require business owners to rent some space as a storefront and to keep the flowers. A flower shop may be able to increase its base by offering flower orders to be made online or over the phone. Offering delivery services for larger orders (e.g., a wedding) can also boost sales.

Learn more about opening a flower shop.

Related Articles

Article Sources

IRS: Limited Liability Company

IRS: S Corporations


SBA: Small Business Guide

SBA: Choose a Business Structure Guide

US Census Bureau: Small Business Statistics

SBA Office of Advocacy: Data on Small Business

FRED: SBA Data for Small Business