I pulled the trigger today

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navycop

navycop

Member
Joined
Nov 4, 2010
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2,333
Location
Virginia Beach, VA 23454
I went to the Business License people entending just to get a checklist of what I needed to obtain my license. The lady started asking me all this information and typing it in the computer. Before I knew it I walked out of there $50.00 lighter and told my business certificate will be mailed to me. Now I have a bunch of tax questions and do I need to put the number on all my correspondance and recipts?
 
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I don't think so (IMO) Just keep track of the money you receive, the money you spend toward your business, the miles you travel for your business. This is all for tax stuff.
I would say DO NOT PUT YOUR BUSINESS LICENCE ON ANY OF YOUR PAPERS, RECEIPTS OR THE LIKE. You may have to post in plain view on some of the shows to attend IF THEY require it. Now this is how I have done it in California. Your State may require other things. But guard you license as you would to keep people from getting you I.D.
 
Now that you have made the leap pay an accountant for an hour of their time. In my opinion when it comes to the tax man a forum is not the place to get advice. Except maybe these two

1-Talk to an accountant because "I did not know" means nothing to the IRS and state tax office

2-Get an accounting program, we use quickbooks.

Number one has saved me a crap load of cash in the long run. Number two irritates me regularly but has saved me crap loads of cash in the long run.
 
NO

navycop said:
I went to the Business License people entending just to get a checklist of what I needed to obtain my license. The lady started asking me all this information and typing it in the computer. Before I knew it I walked out of there $50.00 lighter and told my business certificate will be mailed to me. Now I have a bunch of tax questions and do I need to put the number on all my correspondance and recipts?
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No.

You usually only have to present it if asked. You might be required to display it if you sell at craft or art shows, it depends on the state law where your licensed.

If you have a box store, or regularily use part of your home for selling, you might need to display it there.
 
Haynie said:
Now that you have made the leap pay an accountant for an hour of their time. In my opinion when it comes to the tax man a forum is not the place to get advice. Except maybe these two

1-Talk to an accountant because "I did not know" means nothing to the IRS and state tax office

2-Get an accounting program, we use quickbooks.

Number one has saved me a crap load of cash in the long run. Number two irritates me regularly but has saved me crap loads of cash in the long run.
Click to expand...

That depends on how big your business gets. AND make that a TAX ACCOUNTANT specializing in small business. My daughter who is a CPA with a Masters Degree and Partner at Ernst and Young and very good at her job knows less than I do about small business taxes and about everything there is to know about large corporation tax accounting. All accountants are not equal when you are asking about taxes.

Agreed but you might look for something cheaper easier to use and with less function than Quickbooks - at least to start....I have found quickbooks is a little overkill even for my business and way overkill for a really small business
 
Depending on your state and even city town is different, contact the state tax dept. or check out your local library they generally have the information, and the reference librarian is happy to help.

Do not put your license number on any paper work! most times it is contractors or re modelers that are the only ones required to.

To purchase wholesale you will need the state sales tax license number or what they call it in your state.
Here in Michigan, I am a manufacture as I sold to stores at the wholesale level. Most suppliers here require you to update your forms once a year.

I have used turbo tax in the past and now use H&R tax software. It has the federal schedule C for most small home based biz's you can go to the fed tax site and down load all the instructions and forms. Check them out before doing your first one.
Also keep good paperwork, keep it separate from house hold, And you will find it will not be shall a stomach churner the first time.

You will be doing a cash accounting system, will need to keep track of what you buy to make the pens or widgets.

The biggest advantage to doing the taxes is the balance of profits against expenses. Also you can take losses for 3 out of 5 years. Get the tax forms and instructions.

The biggest disadvantage of using a service or book keeper after the cost. Some want weekly paperwork, or monthly and on the type of forms they use. anything else or anyway else they will charge you for sorting it out.

EVERY STATE AND LOCAL area has their own reg's check into what they are. Also check the Small business Administration and see if they have a local score chapter, it is retired business people that help new ones for little or no cost.
:clown:

PS locally the business license is known as assumed names papers whether it is your name or not. It has all your contact info in the event the sheriff has to track you down!:eek:

And as Smitty said a small business accountant, getting an hour or two of their time will save you many hours of headaches.

Also check your local community college or night school some offer intro to small biz or entrepreneurship1
:clown:
 
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PTsideshow said:
Depending on your state and even city town is different, contact the state tax dept. or check out your local library they generally have the information, and the reference librarian is happy to help.

Do not put your license number on any paper work! most times it is contractors or re modelers that are the only ones required to.

To purchase wholesale you will need the state sales tax license number or what they call it in your state.
Here in Michigan, I am a manufacture as I sold to stores at the wholesale level. Most suppliers here require you to update your forms once a year.

I have used turbo tax in the past and now use H&R tax software. It has the federal schedule C for most small home based biz's you can go to the fed tax site and down load all the instructions and forms. Check them out before doing your first one.
Also keep good paperwork, keep it separate from house hold, And you will find it will not be shall a stomach churner the first time.

You will be doing a cash accounting system, will need to keep track of what you buy to make the pens or widgets.

The biggest advantage to doing the taxes is the balance of profits against expenses. Also you can take losses for 3 out of 5 years. Get the tax forms and instructions.

The biggest disadvantage of using a service or book keeper after the cost. Some want weekly paperwork, or monthly and on the type of forms they use. anything else or anyway else they will chrage you for sorting it out.

EVERY STATE AND LOCAL area has their own reg's check into what they are. Also check the Small business Administration and see if they have a local score chapter, it is retired business people that help new ones for little or no cost.
:clown:
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I would add to that - don't depreciate anything - there is a section 179 which allow you to expence any equipment you're likely to buy for your business (I think they allow up to $200,000 or so).

That is almost it....if you don't want to get classified as a "hobby" you need to show a profit 2 out of 5 years in most cases. If classed as a hobby you can only deduct expenses up to the amount of your gross income, you can't deduct losses against other income.
 
Smitty37 said:
Haynie said:
Now that you have made the leap pay an accountant for an hour of their time. In my opinion when it comes to the tax man a forum is not the place to get advice. Except maybe these two

1-Talk to an accountant because "I did not know" means nothing to the IRS and state tax office

2-Get an accounting program, we use quickbooks.

Number one has saved me a crap load of cash in the long run. Number two irritates me regularly but has saved me crap loads of cash in the long run.
Click to expand...

That depends on how big your business gets. AND make that a TAX ACCOUNTANT specializing in small business. My daughter who is a CPA with a Masters Degree and Partner at Ernst and Young and very good at her job knows less than I do about small business taxes and about everything there is to know about large corporation tax accounting. All accountants are not equal when you are asking about taxes.

Agreed but you might look for something cheaper easier to use and with less function than Quickbooks - at least to start....I have found quickbooks is a little overkill even for my business and way overkill for a really small business
Click to expand...

Yep use the right accountant. The Small Business Administration might have a person you could talk to free in your area. They could be really helpful.

We settled on quickbooks because it did everything I needed it to do in one program (inventory, invoicing, . I listed it as an example. There are free ones out there, but my experiences led us back to Quickbooks.
 
Haynie said:
Smitty37 said:
Haynie said:
Now that you have made the leap pay an accountant for an hour of their time. In my opinion when it comes to the tax man a forum is not the place to get advice. Except maybe these two

1-Talk to an accountant because "I did not know" means nothing to the IRS and state tax office

2-Get an accounting program, we use quickbooks.

Number one has saved me a crap load of cash in the long run. Number two irritates me regularly but has saved me crap loads of cash in the long run.
Click to expand...

That depends on how big your business gets. AND make that a TAX ACCOUNTANT specializing in small business. My daughter who is a CPA with a Masters Degree and Partner at Ernst and Young and very good at her job knows less than I do about small business taxes and about everything there is to know about large corporation tax accounting. All accountants are not equal when you are asking about taxes.

Agreed but you might look for something cheaper easier to use and with less function than Quickbooks - at least to start....I have found quickbooks is a little overkill even for my business and way overkill for a really small business
Click to expand...

Yep use the right accountant. The Small Business Administration might have a person you could talk to free in your area. They could be really helpful.

We settled on quickbooks because it did everything I needed it to do in one program (inventory, invoicing, . I listed it as an example. There are free ones out there, but my experiences led us back to Quickbooks.
Click to expand...
I also use quickbooks now but even for my business it has a lot of function (payroll, tax withholding, SS, Banking and etc.) that I don't use at all. I used quicken home and business for quite a while but that's almost as expensive as quickbooks.

If someone is just selling pens there should be something easier to use.
 
We always have our license on display. When people want to offer cash with NO TAX, we just point to the license and mention State Franchise Auditors.
 
How come nobody talks about an IRS Tax ID Number?! Maybe when you go to get a number from the Virginia Dept. of Revenue (or whatever it's called up there) they will give you some more information.:eek:
 
Jgrden said:
We always have our license on display. When people want to offer cash with NO TAX, we just point to the license and mention State Franchise Auditors.
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Here in DE, you need to have it on display in your "place of business" However since we do not have a State sales tax we really don't need to display them at shows and of course we remind people - especially those from surrounding states - that there is no sales tax here.

We just have a gross receipts tax which kicks in at 2 mil for retail business. I have to report every quarter but never have to send money.
 
navycop said:
nativewooder said:
How come nobody talks about an IRS Tax ID Number?! Maybe when you go to get a number from the Virginia Dept. of Revenue (or whatever it's called up there) they will give you some more information.:eek:
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They said something about my social being my tax number because I was sole propriator.
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You actually have an option, you can use your SSN as your Tax ID, or you can ask them for a TIN specifically for your business. Up to you.
 
nativewooder said:
How come nobody talks about an IRS Tax ID Number?! Maybe when you go to get a number from the Virginia Dept. of Revenue (or whatever it's called up there) they will give you some more information.:eek:
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In most cases you can get if you want but you do not need an IRS Tax ID...you can use your SSN. You might have to get a Tax ID if you have employees because you have to do withholding of taxes and FICA.
 
Always get an EIN number from the Feds. Do not give out you social security number. I am a sole proprietorship and I have an EIN Number. It's free you get it right away.
 
As a retired accountant I cannot over emphasize the importance of keeping detailed records on a timely and current basis. Regardless of what you choose, do it yourself bookkeeeping, or an accounting service, both require detailed and accurate and honest records. Which way you go is your call, but both require good record keeping!
 
navycop said:
ashaw said:
Always get an EIN number from the Feds. Do not give out you social security number. I am a sole proprietorship and I have an EIN Number. It's free you get it right away.
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Excuse my ignorance, What is EIN? (employee identification number)?
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It's the employer identification number basically a tax id number for your business from the federal government. With ID theft rampant today I do not give out my social security number. Having been through that nightmare 14 years ago not fun at all.
 
navycop said:
ashaw said:
Always get an EIN number from the Feds. Do not give out you social security number. I am a sole proprietorship and I have an EIN Number. It's free you get it right away.
Click to expand...

Excuse my ignorance, What is EIN? (employee identification number)?
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That would be employer...It is essentially a Federal Income Tax ID number for businesses. Some states also accept it and some accept a variation of it that identifies their state. You can obtain one even if you don't really need it, it's free. It might help a little against identity theft - but not much.
 
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