Do I Need an LLC for My Gutter Cleaning Business?

Starting a limited liability company (LLC) for your gutter cleaning 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 gutter cleaning business, lawsuits can arise from things like an employee falling off a customer’s roof and getting injured or accidentally damaging a customer’s property while cleaning their gutters.

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

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

Do I Need an LLC for a Gutter Cleaning 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 Gutter Cleaning Business

By starting an LLC for your gutter cleaning 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.

Gutter cleaning businesses will benefit from liability protection because of the risk of physical injury from falls and liability from property damage.

Example 1: A gutter cleaning business is hired to clean the gutters of a home, but accidentally damages the roof while performing the service. Following this, the homeowner sues the business for the cost of repairs. Without liability protection, the owner's personal assets will be at risk should the business be found to be guilty.

Example 2: A gutter cleaning business is hired to clean the gutters of a home but fails to properly secure their ladder, and it falls against a neighbor's window, causing it to shatter. Following this, the neighbor sues the business. If the gutter cleaning business was found liable, the LLC structure would help protect the owner's personal assets.

Example 3: A customer complains that their gutter system was not properly cleaned, resulting in their basement flooding. The customer then sues the gutter cleaning business for damages. With the business structured as an LLC, the owner’s personal assets will not be affected by any fees associated with the lawsuit.

Example 4: A new employee is cleaning the gutters of a client when he accidentally pulls too hard on the gutter. Part of it rips off and lands on the client standing below, injuring them. The client sues you for the repair costs as well as their 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 Gutter Cleaning 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 gutter cleaning 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

Gutter cleaning 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?

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.

Gutter cleaning services can potentially lead to property damage and even injury in some instances, so purchasing business insurance is critical.

Common Situations Business Insurance May Cover for a Gutter Cleaning Business

Example 1: A new employee is cleaning the gutters of a client when he accidentally pulls too hard on the gutter. It rips off, taking a portion of the roof with it. Your general liability insurance covers damage to customer property.

Example 2: A client is talking to you while you are cleaning her gutters. The gutter breaks loose and strikes her on the head, requiring a trip to the hospital. She asks that you pay for her treatment. Your general liability insurance will likely cover this expense.

Example 3: A potential client sees your business’s sign and stops by to talk to you about your services. He makes a trip to the restroom and slips and falls, breaking his arm. He decides to sue your business. Your general liability insurance will pay for your legal defense, including the cost of a settlement if one is necessary.

Other Types of Coverage Gutter Cleaning 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 gutter cleaning businesses should obtain:

Professional Liability Insurance

Professional liability insurance is designed specifically for your business. It protects you against negligence claims due to mistakes or failure to perform. If a client sues you, claiming that a mistake you made caused him or her injury, your policy will pay for your legal defense. It will also pay for a settlement if one is required.

Commercial Auto Insurance

If you have a vehicle that you use for business, you need commercial auto insurance to meet your state’s insurance requirements. It will provide protection for the vehicle, those in the vehicle, and other people on the road. If you are involved in an accident, it will help pay for repair or replacement costs and for medical treatment.

Workers’ Compensation Insurance

If you have employees, your state likely requires that you carry workers’ compensation insurance. It will protect your employees if they are injured performing work-related duties. It will cover medical treatment for work-related injuries and will help to pay for lost wages if they are unable to work while they recover.

Commercial Umbrella Insurance

An umbrella policy is designed to kick in when your general liability insurance limits are exceeded. Your limits may be exceeded in certain circumstances, like if you lose a major lawsuit. Instead of having to pay the remaining damages out of pocket, you can rely on your umbrella policy up until its limits are reached.

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, commercial auto insurance, and workers’ compensation insurance if you have employees.

Read our Gutter Cleaning Business Insurance article for more info.

To start a gutter cleaning business, you'll need a ladder, a ladder stabilizer, buckets and tarps, rubber gloves, insurance, and potentially a pressure washer and leaf blower. You'll also need a vehicle that can transport the ladder, or you can rent one when needed.

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

The ongoing expenses of running a gutter cleaning business are minimal and include equipment maintenance, transportation, labor, and insurance.

Learn more about running a gutter cleaning business.

Gutter cleaning businesses make money by charging a fee for their services, usually by linear foot cleaned.

Learn more about starting a gutter cleaning business.

Gutter cleaning businesses can be very profitable because of their minimal operational costs.

Business owners can choose to operate as a seasonal business or they can boost their profits by offering services year-round. They also make more money by offering related services such as window cleaning.

Learn more about starting a gutter cleaning business.