Should I Start an LLC for My Mobile Vet Business?

Starting a limited liability company (LLC) for your mobile vet 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 mobile vet business, lawsuits can arise from things like an inability to repay creditors what they are owed as well as any veterinary malpractice claims.

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

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

a mobile veterinarian visiting a barn for a check up on an animal

Do I Need an LLC for a Mobile Vet 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 Mobile Vet Business

By starting an LLC for your mobile vet 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.

Mobile vet businesses will benefit from liability protection because of the risk of being sued for personal injuries, property damage, and trademark infringement.

Example 1: Your mobile vet business is sued by the owner of a parking lot who claims you owe him rent. You maintain you should just pay the regular parking fee. If the court rules against you, be comforted that the parking lot owner can only be paid from business assets. The judgment cannot apply to your personal assets.

Example 2: Your mobile vet business is unable to service a term loan from the local bank. Although your personal assets are adequate to make the payments, there is no legal compulsion to do so. Your personal assets cannot be levied upon to pay the loan, unless you had provided a personal guarantee.

Example 3: You decide to close your mobile vet business to work at an animal hospital. Sadly, the business does not have enough assets to pay off all creditors in full. However, what is comforting, is that your personal assets would be protected by the limited liability shield of your LLC.

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 Mobile Vet 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 mobile vet 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

Mobile vet 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 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.

A mobile vet business should carry general liability insurance which covers risks that may result in personal injury or property damage. Legal fees, court judgments, and settlements might also be covered.

Common Situations Business Insurance May Cover for a Mobile Vet Business

Example 1: While you examine a dog, a customer walks up to say hello, receives a bite from the animal, and then sues you and the dog owner for damages. General liability insurance would cover your legal costs and any court-awarded damages.

Example 2: A local business claims your new marketing campaign closely resembles their marketing materials, causing their business to suffer. If they sue you for damages, general liability insurance would cover your legal costs and any payouts awarded by the court.

Example 3: When you seek to expand your company, you apply for a business loan. As part of the loan terms, your bank requires you to carry a minimum of $1 million in general liability insurance.

Other Types of Coverage Mobile Vet 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 mobile vet businesses should obtain.

Commercial Auto Insurance

Since you will be driving your business vehicle on public roadways, you are mandated by the state to carry a commercial auto policy. Auto insurance protects not only your vehicle but any liability you may have in an accident. Your personal car insurance will not cover you if you are driving the business vehicle, even if you are off duty.

Mobile vet businesses invest heavily in the equipment that is used to perform their services. Be sure that you have enough coverage to replace all of your equipment in case of loss. This coverage is generally offered in a Business Owner Policy (BOP).

In addition to the policies outlined above, there are a few other types of coverage your mobile vet business may require depending on certain aspects of your operations. Some of these might not apply to you, so be sure to ask your agent which policies are right for your business.

Workers' Compensation Insurance

If your mobile vet business has any employees (full-time or part-time), you are legally required to carry workers’ compensation insurance. This type of coverage will help compensate your employees in the case that they get injured on the job.

Read more about workers’ compensation insurance.

Business Interruption Insurance

In the event of a fire, flood, or other catastrophes, there is a good chance your business operations will be halted for some time. Business interruption coverage is designed to help you recoup a portion of the revenue your business would lose due to the inability to operate.

This type of insurance is typically included in a business owner’s policy.

Commercial Umbrella Insurance

Umbrella coverage allows you to extend above and beyond the standard limits of your other business insurance policies. If you are faced with a large lawsuit or other claim situation, there’s a possibility that the coverage limits of your standard policies will be insufficient. In this case, your umbrella policy will allow you to surpass these limits.

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, professional liability insurance, workers’ compensation insurance, and commercial auto insurance.

Read our Mobile Vet Business Insurance article for more info.

Startup costs for a mobile vet business can be substantial. Some estimates put the figure at around $300,000. Most of this will go toward a vehicle and equipment. Monthly costs will include medical supplies, vehicle costs, and commercial insurance.

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

The main ongoing expenses include vehicle maintenance, fuel, medical supplies, and insurance premiums.

Learn more about running a mobile vet business.

A mobile vet charges customers fees for medical exams and procedures.

Learn more about starting a mobile vet business.

A mobile vet business travels to customers’ locations to administer veterinary services. This may also include basic grooming services like nail trims.

Profits depend on a number of factors, including the population density and average income in the area where you will do business.

Learn more about starting a mobile vet business.