navycop
Member
I was asking my accounting buddy to help me with budgeting my pen books. He asked me if I had a business license. Do all of you have one?
License, We don't need no stinking license
- Thread starter navycop
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Buzzzz4
Member
yes, I have a DBA (sole proprietorship)
Couple of things
I have one. Whether or not one is required, will depend on the jurisdiction where you conduct your business and whether you intend to use your own name or come up with a business name. Some banks will require that you have a DBA license to get a business account and deposit checks made out to the business. Delaware has a gross receipts tax that doesn't affect most small business but we still have to file.
Federal does not require you to have a business license but having a license can be helpful if they want to classify your business as a hobby business.
btw. Folks who are just starting a business and expect to lose money for a couple of years...here is a tidbit of info.
You must make a profit 3 out of 5 years to be presumed to operating a for profit business that lets you write off business losses against other income. But there is a form (form 5213) you can fill out and file with the first year that puts off determination for 5 years. So if 2011 was the first year you can put off until 2016 determination of whether or not it is a "for profit" activity. That can save you some grief dealing with the IRS in the early years of your business.
I have one. Whether or not one is required, will depend on the jurisdiction where you conduct your business and whether you intend to use your own name or come up with a business name. Some banks will require that you have a DBA license to get a business account and deposit checks made out to the business. Delaware has a gross receipts tax that doesn't affect most small business but we still have to file.
Federal does not require you to have a business license but having a license can be helpful if they want to classify your business as a hobby business.
btw. Folks who are just starting a business and expect to lose money for a couple of years...here is a tidbit of info.
You must make a profit 3 out of 5 years to be presumed to operating a for profit business that lets you write off business losses against other income. But there is a form (form 5213) you can fill out and file with the first year that puts off determination for 5 years. So if 2011 was the first year you can put off until 2016 determination of whether or not it is a "for profit" activity. That can save you some grief dealing with the IRS in the early years of your business.
Turned Around
Member
just my simple DBA, that's it
Yep
account. They still came around and said "you need a DBA for us to accept checks made out to the business".
I had to do that even before I left NY and even though I already had the account and it was a business (farm)
account. They still came around and said "you need a DBA for us to accept checks made out to the business".
JohnGreco
Member
Yes, registered as a sole proprietor LLC.
PenMan1
Member
Yes, you really need a business license and at least a "DBA". Next year, due to new Government regulations, it will become virtually impossible to deposit checks made to a business or credit card funds into a personal account.
The only way to get a business bank account is to register the business.
p.s. - virtually every bank here offers free personal checking. The cheapest business checking account, so far, is $38 a month.
The only way to get a business bank account is to register the business.
p.s. - virtually every bank here offers free personal checking. The cheapest business checking account, so far, is $38 a month.
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navycop
Member
Thanks. What is DBA? Where do I find info on obtaining a license? Can customers just make checks in my name?
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PenMan1
Member
DBA is "doing business as". For example, Mike....DBA Navy Cop.
DBA registration processes vary from State to State, County to County, and even Parish to Parish.
In most States, the business is set up through the Clerk of Court. If you do your homework on the processes in your area, you can easily set up a DBA (or even an LLC Corp) without the expense of a lawyer.
In our area, the fee for DBA was approximately $150 and another $50 to run the legal notice in the approiate newspaper.
DBA registration processes vary from State to State, County to County, and even Parish to Parish.
In most States, the business is set up through the Clerk of Court. If you do your homework on the processes in your area, you can easily set up a DBA (or even an LLC Corp) without the expense of a lawyer.
In our area, the fee for DBA was approximately $150 and another $50 to run the legal notice in the approiate newspaper.
cwolfs69
Member
yes i do. DBA is "doing business as". that is what you are called when you are the business but go by a business name, ie. "Pens by Charley".
ed4copies
Local Chapter Manager
Some things are better left to experts.
If you plan to stay REALLY SMALL---Do it yourself--the errors can't be too big. IF you hope to get gross sales over $10,000 per year---talk to an expert.
The IRS code is only half the story---recent interpretations in case law is the other half. A good accountant will "be on top of" what the code means, today. They can save you more than they cost you.
FWIW,
Ed
If you plan to stay REALLY SMALL---Do it yourself--the errors can't be too big. IF you hope to get gross sales over $10,000 per year---talk to an expert.
The IRS code is only half the story---recent interpretations in case law is the other half. A good accountant will "be on top of" what the code means, today. They can save you more than they cost you.
FWIW,
Ed
ashaw
Member
Yes I am register as a business. Here is PA as long as you are a manufacture/whole seller you do not need a local license to do business. I only have to pay normal income taxes not the millage that a retailer does. Also I do not have to worry about sales tax reporting. But this model does not work for everyone. Be sure to to talk to an accountant. It is the only way to ensure that down the road you will not be hit by fines.
Alan
Alan
Mike, I'm glad you asked this question. I'm not at the stage of selling pens yet but when I do I'm going to need this info. Thanks to everyone for the replies.
May I expand on this topic?
Let's say I make a number of pens and want to sell a few to get cash to buy more supplies. I list ... 5 or 10 pens on ebay using an ebay user name (but not strictly a 'business' name). I'm not doing anything different to anyone selling off a few unwanted personal items ... new in packaging action figures as an example... so in the eyes of 'the law' am I running a business? Do I then need a DBA or any other licences?
This is a very tricky subject and one open to many interpretations
May I expand on this topic?
Let's say I make a number of pens and want to sell a few to get cash to buy more supplies. I list ... 5 or 10 pens on ebay using an ebay user name (but not strictly a 'business' name). I'm not doing anything different to anyone selling off a few unwanted personal items ... new in packaging action figures as an example... so in the eyes of 'the law' am I running a business? Do I then need a DBA or any other licences?
This is a very tricky subject and one open to many interpretations
OKLAHOMAN
Member
I'm a registered business actually two business's, but in OK no business license is needed if your not a brick and mortar store. But you do need to have a sales tax # if you sell in Oklahoma. I have sales tax #'s in 7 states and have to buy license's in 2 each time I do a show there. In a few towns I need also to purchase a license.
Haynie
Member
As my accountant would say the first two years I ran this place in his fatherly voice "well mark it is my job to keep you out of jail, what did you do this time?"
With the IRS it is NOT easier to ask forgiveness than it is to ask permission. They tend to see things black and white.
With the IRS it is NOT easier to ask forgiveness than it is to ask permission. They tend to see things black and white.
It can be easy or a pain
What we have going on is one more step in the Government having total control over your finances.
But, if you have all checks made out to you personally, you can use a regular checking acount unless they have some limits on the number of checks you can deposit. I use paypal as my business account and have the few checks that I get made out to me, deposit them in my regular checking account and transfer the funds to paypal. I also write the few paper checks I send out from my personal account and transfer the funds from paypal to cover them. But, we're only talking about two or three checks a month.
In Delaware the process is easy, you get a business license and that covers the DBA since it has both the business name and address and your name and address and the license fee covers both. Elsewhere I wouldn't bet that it is as easy. In NY it was fairly easy but was handled by the county clerk, because while you needed a DBA we didn't need a business license.
What we have going on is one more step in the Government having total control over your finances.
But, if you have all checks made out to you personally, you can use a regular checking acount unless they have some limits on the number of checks you can deposit. I use paypal as my business account and have the few checks that I get made out to me, deposit them in my regular checking account and transfer the funds to paypal. I also write the few paper checks I send out from my personal account and transfer the funds from paypal to cover them. But, we're only talking about two or three checks a month.
Jgrden
Member
Yes, to protect our name, Twin Peaks Art. Adds credibility to your practice. Banks require it to deposit and clear checks.
navycop
Member
Smitty, that's what I was talking about. If I just sell to friends, family and the ocassional craftshow have them put my name on the checks. I am not looking to be like some of the vendors on here and sell all over the place.
Use your personal account
You can use your personal bank account and whether or not you need a license depends on local law. If they require a business license to do craft shows you'll need to get one.
navycop
Member
Anything about craftshows. They advertised for crafters to set up tables at the hospital for a fundraiser. I bet alot of them knitting woman don't have a business license.
My guess
I would guess that they don't and maybe you don't need one. Usually they (the governments) want to get sales tax and they can be a pain about that. We don't have sales tax here so I can't offer any help to speak of about that.
I would guess that they don't and maybe you don't need one. Usually they (the governments) want to get sales tax and they can be a pain about that. We don't have sales tax here so I can't offer any help to speak of about that.
rkenly
Member
my local city servant called me, and then a letter demanding a copy of my business license. If you have ads in the "pennysaver", "green sheet", "swap sheet", etc, they had someone looking at ads, and if you were selling something besides your old clothes, etc - they came looking for a business license. Hit you up with a late fee too. (Luckily I had one - the person on the phone was disappointed - I bet they got a commission). Torqued me off that I had to prove that I had a license vs taking my word for it.
>>>Rod<<<
>>>Rod<<<
TellicoTurning
Member
I opened my hobby business under a DBA and when i signed up to open a booth at the local public market, it's required there to have a tax license from the state and county... I have the TN tax certificate and still have to file for the county business license... had to wait for the state so I could get the number.
jcm71
Member
When I sell at the Chattaooga Market I have to buy a temporary business license ($5) that is good only for the month purchased but only at the Chattanooga Market. Also have to buy a temp vendors license to sell in Chattanooga (good for the weekend).
Haynie
Member
Right here is one of those situations where i wish there was ONE rule for everywhere. State's Rights trump here but it would nice if the fifty states would agree with each other. It is the least they could do. Of course if it were easy we would not have to pay accountants a lot of money.