Becoming a Legal Business

89gt-stanger · 07-01-09, 03:18

I am now ready to become a legal business. I will have no employees. I am located in Texas. I will be operating out of my garage, and have a vehicle/trailer for the mobile details.

Can someone who has done this let me know what forms, permits and other things I will need? How will I file taxes? What can I file for deductions?

Sorry this is so short, I should explain better, but I am time constrained right now.

Thank yall so much!

Jakerooni · 07-01-09, 03:23

Since your new to this process I will make it as simple as I possibly can

Step 1: Go hire an accountant... Tell them exactly how you plan on conducting business

Step 2: Follow their advice... End of story.

Reasoning is this. I'm personally an LLC. Because at one time I did have employee's and I like the Tax breaks and pass through cash flow the LLC offered me. You may very well do great as a sol prop, maybe a limited partnership is the right course for you. OR your situation calls for an S-corp or C- corp. Only a qualified Accountant will know which situation is best for your own personal needs.

Or you can just ignore good advice and do what 99% of other people tend to do and go down to the courthouse and simply grab a DBA and miss out on all the tax breaks and such...

89gt-stanger · 07-01-09, 06:53

Quote:

Originally Posted by Jakerooni

Or you can just ignore good advice and do what 99% of other people tend to do and go down to the courthouse and simply grab a DBA and miss out on all the tax breaks and such...

Is this statement mean that I can just get a DBA and not have to get an LLC or SP. No other legal proceedings? This does not sound right.

Thanks.

Jakerooni · 07-01-09, 07:21

A LOT of people only go and get DBA's without consulting with an accountant or an attorney. To me this is just plain bad business. But it's perfectly legal and like I said a LOT of people do it on a daily basis. this automatically makes you a Sole Proprieter (Sol prop for short) It's the most basic of all business entities. It's easiest to start but the lest effective. That's why I always strongly recoomend at least consulting with an Accoutant or attorney to guide you in what is the best entity for your own personal goals and situations.

brwill2005 · 07-02-09, 05:57

Where I live in NOVA, you need a business license from the county which the business is based. This is simply a license for the county to tax you on your gross receipts and your business personal property. If the name of the business is different than your own, you need a to file a fictitious business name document. If you intend to become a corporation or LLC etc, you need to file that with the state. As for deductions, look on the IRS website. There are many things you can and can not deduct. In addition, get insurance to cover you in the invent something bad happens.

Jason M · 07-02-09, 07:00

Every state is different....well, maybe not EVERY state. But they all have their own rules. In Colorado for example, you don't need to do anything...literally, nothing to become a Sole Proprietor. You don't need to register, have insurance, etc. You *can* register with the state if you want. You are only responsible for paying your income tax at the end of the year. Keeping track of your receipts and mileage on your work vehicle is important. Other than that don't expect to write much off unless you move up to having employees and becoming an LLC.

Again, Texas might be completely different. Going to your states website would be a good start.

brwill2005 · 07-02-09, 03:21

Some things you MAY BE able to write off; owner salary, vehicle expenses (mileage/actual cost), advertising/marketing, business insurance, supplies, equipment, clothing, office supplies, tolls, licenses and taxes.

89gt-stanger · 07-04-09, 08:02

Quote:

Originally Posted by Jason M

Every state is different....well, maybe not EVERY state. But they all have their own rules. In Colorado for example, you don't need to do anything...literally, nothing to become a Sole Proprietor. You don't need to register, have insurance, etc. You *can* register with the state if you want. You are only responsible for paying your income tax at the end of the year. Keeping track of your receipts and mileage on your work vehicle is important. Other than that don't expect to write much off unless you move up to having employees and becoming an LLC.

Again, Texas might be completely different. Going to your states website would be a good start.

I have found a few websites, but I honestly confused on what I am required to have. If I do not get a Tax ID #, can I have charges brought up against me for tax fraud?

89gt-stanger · 07-04-09, 08:13

I am hoping ScottWax or someone in Texas replies.

mshu7 · 07-05-09, 07:04

Check with your local Chamber of Commerce for a good accountant and/or attorney to guide you through this process. It's the best way to go about it, as Jake has pointed out.

89gt-stanger · 07-05-09, 10:39

I am under the age of 18. Am I still able to obtain a DBA? I have a SSN.

Thanks!

Jason M · 07-06-09, 06:21

Your tax ID# will just be your social. When you are a sole prop. *YOU* are the business. Just register your name (if needed), get insured, and pay based on your income. That's why I don't get writing off the "owners" salary as stated up above. Whatever you pay yourself is income, whatever the business makes is income. It's all the same.

It's honestly not something to get to hung up on. Most places tend to not care what you do as long as you are paying income tax. Being registered or having a business license is just another state fundraiser.