If
you are planning to start a business
don't forget business regulations....
Most small business
advisors recommend that you at least Register a
Ficticious name, a Business Licence and obtain a
federal tax id.
If you already decided on the type of
service or product to sell, you are ready to start
your business. The next thing you need is to
choose a
legal business entity:
There
are
advantages and disadvantages of sole
proprietorship, partnership and corporation.
However, if you are ready to operate your business,
just go ahead and
First,
Register a DBA or Incorporate Your Business:
If you do business in a business name
(e.g., Carpet Express) other
than your personal name (e.g., Al Pacone),
you are required to
register and publish a
DBA, or
Incorporate.
Benefits: You
need a DBA statement
certificate or a corporation certificate so you
can open a merchant or business bank account,
discourage competitors from
using your business
name, and enforce contracts you entered into
under the business name.
Third, in California, you need a
State Tax Id: EIN Employer ID,
if you have employee (s).
So, if you don't have employees, you don't need
one. Note: you must have a federal tax id before
you can obtain a state tax id.
Fourth,
A
Sales Tax Id:
same as a
Seller's Permit, Sales Tax Certification, Wholesale
License -- you need a Reseller's License if you buy or
sell wholesale or you sell retail - you don't pay
taxes when buying wholesale. Example, you sell
computers or clothing online in California.. you
need a Reseller's License to buy wholesale tax free.
When you sell, you charge taxes (collect taxes) to
pay to government later.
Business Licence:
All
businesses need a Business Licence. This is the same
as business tax registration and it is not the same
as a DBA. Note: you need a
DBA to open a bank acount - not
a
Business Licence.
See
a Table of Required Documents
