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Why Should I Incorporate
My Business?
The bottom
line? If you are sued by a client or customer - your
personal assets will not be seized or accessible.
Incorporating
your business protects YOU.
The main
advantage of a corporation is the liability
protection it provides its owners or shareholders.
Liability is limited because the corporation is a
legal entity that is separate from its shareholder
owners. As a separate legal entity, the corporation
has a perpetual life. Also, as a separate legal
entity, the corporation is liable for its own debts
and can only be held liable to the extent of the
corporation's assets. Most small businesses
find that an LLC is the best corporate identity for
them. When you are ready to incorporate, you can
painlessly file
here - click.
» When
do I need a Federal Tax ID Number [EIN]?
You do not
need to get an EIN (federal tax ID or Employer
Identification Number) from the IRS if you are a
sole proprietor without employees. You can open your
business bank account with your DBA name using your
social security number (SSN). You will file Schedule
C at the end of the year with your personal tax
return, and if you have made a profit, Schedule SE
(for self-employment tax) as well.
» What's
a DBA?
DBA is an
acronym for "Doing Business As" (also
known as a "Fictitious Name."). Most
states require that sole proprietorships and
partnerships that are conducting business under a
name other than the owner(s) must file for a DBA
certificate in the county where business is
conducted. The DBA certificate is generally obtained
at the Clerk of Court of the county in which
business will be conducted.
» Do
I need a Business License and if
so, where do I get one?
Depending
on the type of business you are starting, you may be
required to obtain local, county, State or Federal
licensing. It's important to determine which of
these will be required before you start conducting
any business since heavy fines are usually
associated with conducting a business without proper
licenses and permits.
Most
small and home-based businesses will only require a
local business license or permit.
First
call or visit your city or county » Department
of Revenue. If you intend to operate a business
from your home, be sure to also check local zoning
requirements as well as any property covenants.
Zoning requirements are those laws that regulate how
property can be used and in some cases, some
activities may not be allowed.
Certain
businesses and professions will also require a State
license. Examples include attorneys, barbers,
contractors, dentists, most businesses serving food,
and social workers. Each State has an agency dealing
with these types of businesses.
For
a very few businesses, Federal licensing is
required. Examples would be a business that is
engaged in providing investment advice or dealing
with firearms. In general, Federal licensing is
required if the business is highly regulated by the
government. It's best to consult an attorney in
these cases.
» How
do I get certified as a women-owned
business?
This process
is usually administered through the State's Economic
Development Council. Contact your local SBA office
for additional information.
» How
can I determine if I may deduct home office
expenses on my taxes?
IRS
publication #587 has the whole story. Download a
copy from their site at the
IRS.
» What's a "business
plan" and do I need one?
A business
plan is an essential element of any serious business
startup. » Click
here to download our business plan template,
with detailed step-by-step information about how to
create your perfect business plan.
Other sites
with business plans are:
SBA-Business
Plan Outline
Edge
Online
Bplans
American
Express Small Business
Industry
Canada
Biz
Plus
» Can
a husband and wife be a Sole Proprietorship?
No.
Technically a husband and wife cannot jointly own a
business as a sole proprietor; they cannot split a
sole proprietorship and file two Schedule C and two
Schedule SE. To avoid being classified as a
partnership, a husband and wife team operating a
business together should treat one spouse as an
employee and the other spouse as the owner.
» What's
the difference between a copyright
and trademark?
Copyrights
and Trademarks are often misunderstood and confused
with each other. Here is some basic information:
A copyright
protects a "form of expression" such as
writings, designs, and works of art. A copyright is
automatic in that anything you write, design, or
otherwise conceive, is protected by the copyright
laws. This protection generally lasts for your
lifetime plus 50 years.
A copyright
may be registered with the Patent & Trademark
Office. Having your copyright registered can help if
and when you need to defend it use by others.
A trademark
is a word or series of words, a design or graphic
that relates to your product, service, or company. A
trademark must be registered with the Patent and
Trademark Office.
Click
here to search a trademark.,
at the US Patent & Trademark Office web site.
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