LLC or sole proprietor for a Wisconsin pressure washer

A sole proprietor pays self-employment tax on net earnings

Working under your own name needs no formation filing, and you owe self-employment tax on what the business earns. The rate is 15.3 percent.

The IRS splits the rate into 12.4 percent for Social Security and 2.9 percent for Medicare. You owe it once your net earnings from self-employment reach $400.

You can deduct the employer-equivalent half of the tax when you work out your adjusted gross income. That softens the income tax bill, but not the self-employment tax itself.

15.3%Self-employment tax is 15.3 percent, made up of 12.4 percent Social Security and 2.9 percent Medicare, once net earnings reach $400. — Internal Revenue Service, retrieved 2026-09-29

A Wisconsin LLC costs $130 to form and $25 a year to keep

The LLC is a state filing, and it has a price. Articles of Organization cost $130 online or $170 on paper, and the annual report is $25 online.

Wisconsin's fee table lists those charges next to the corporation fees. Nothing on it is charged to a person who simply starts work under a personal name.

Whether the LLC changes your income tax is a question for a tax preparer, because it depends on how the company is treated. The fee is what the state charges, and the tax result is a separate matter.

$130 / $25Wisconsin charges $130 to organize an LLC online and $170 on paper, plus $25 for the online annual report. — Wisconsin Department of Financial Institutions, fee schedule, retrieved 2026-09-29

The LLC needs a registered agent who is not the LLC

Wisconsin's Articles of Organization ask for a registered agent and a registered office. The entity may not name itself as its own registered agent.

The office must be an actual physical location with a street address. A P.O. box, a mailbox service or a telephone answering service does not qualify.

Annual report forms, notices and other official communications go to that agent. That is why the agent matters: a missed notice can become a missed annual report, and a missed report can lead to dissolution.

The Wisconsin form says an LLC may not name itself as its own registered agent and the registered office must be a physical street address. — Wisconsin Department of Financial Institutions, Articles of Organization form, retrieved 2026-09-29

Changing the registered agent later

You can name yourself, if you are the person who will be at the office during business hours. A crew owner who is often on a roof will want someone reliable there.

Changes cost little. The Department lists a statement of change of registered agent or office at $25, or $10 when filed online.

The other choice is a commercial agent, which some formation services bundle for a first year. The formation services page lists which ones publish that.

$10 onlineA statement of change of registered agent or office costs $25 on paper and $10 online. — Wisconsin Department of Financial Institutions, fee schedule, retrieved 2026-09-29

Doing the filing yourself or paying someone to do it

The state fee is the same either way. A formation service prepares the paperwork, and some add an agent, an operating agreement or reminders.

If you want help, a formation service can do the filing for you. Tailor Brands publishes a $0 Lite plan plus the state fee, with 14-business-day processing, and paid tiers that speed it up.

Weigh the extras against what you would use. The startup costs page lays out the state fees, and the setup guide puts the steps in order.

$0 + state feesTailor Brands lists a $0 Lite plus state fees plan that processes an LLC within 14 business days, and $199 and $249 yearly tiers. — Tailor Brands plans and pricing page, retrieved 2026-09-29

Questions