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View Full Version : Question about starting a business in TN....


ertb
12-08-2009, 03:11 PM
I have kicked the idea of starting a lawn care company for years and now it is a go after losing my job this past march and now making $9.00 less a hour at my new job. As far as equipment I have a Kubota ZG222 with 8 hours on it paid for and all the other stuff you need minus a good trailer. I live in TN so what companies offer liability insurance for this profession. What does insurance usually cost for a one man operation? I know I need to get a business license. My wife has a tax # for her business so can I us that # or do I my own tax # with for my business? Any advice is greatly appreciated.

cmdnvs
12-08-2009, 03:21 PM
I don't know about your other questions, but definitely don't use her tax id. Once you register your new business (whatever you choose, unless it's sole prop) register for your companies own tax id. Using hers can cause trouble for both of you down the line.

rwar
12-08-2009, 06:42 PM
check your local nationwide agent,mine was dirt cheap,a little over 200 a year for 1 mil.

kemco
12-09-2009, 11:34 PM
check your local nationwide agent,mine was dirt cheap,a little over 200 a year for 1 mil.

That's dirt cheap!!! Not that I dont believe you im just amazed. My BOP runs me $1600/yr. That's 1mil liability po/ 2mil ag, $250 deductible with a 10% coinsurance, and then covers my $25k in equipment. I shopped around, this wasnt the cheapest, but I liked the agent better. But they were all about $100 a year give or take from each other.

corey4671
12-10-2009, 12:18 AM
I have kicked the idea of starting a lawn care company for years and now it is a go after losing my job this past march and now making $9.00 less a hour at my new job. As far as equipment I have a Kubota ZG222 with 8 hours on it paid for and all the other stuff you need minus a good trailer. I live in TN so what companies offer liability insurance for this profession. What does insurance usually cost for a one man operation? I know I need to get a business license. My wife has a tax # for her business so can I us that # or do I my own tax # with for my business? Any advice is greatly appreciated.

www.zanderins.com for your insurance. they are a family owned ins broker in nashville and will get you the BEST rates you'll find. I pay roughly $500 a year for $2M in general liability and a small policy that covers the replacement of my equipment.

as far as taxes, are you solo? if so all you need to do is file as a sole proprietor. To do that in the state of TN all you need is your county business license. costs roughly $25. all you need is your ssn. If you happen to live inside the city limits, you'll also need a business license for the city you live in. again, maybe $20-$25

Grasshopper49
12-10-2009, 10:25 PM
Yes, you will need a county and maybe a city license. Both $35 I think. Tax for both is pretty low, but still an expense and paperwork.

You will NOT need a tax license for lawn maintenance. Any work done to improve real property is not taxable. I know a lot of guys do it, but it isn't necessary or right. However, you will have to pay tax on everything you use, equipment, mulch, fertilizer etc., so you will have to be sure to include that cost in your quotes.

I am paying about $900 for $1M liability, but I have a pesticide license, which may increase the price. That also covers my equipment. My trailer is covered by my commercial truck insurance. And yes, be sure to carry commerical insurance. If you get in an accident you persoanl insurance probably won't cover it. You may also need a different license plate for your truck.

Will you be working out of your home and live in the city? You will probably have to check with the zoning dept to get permission. It was not an issue in Rutherford Co as I don't have customers coming to my house and creating traffic/parking issues. Maybe differrent where you live.

Do you live in a deed restricted subdivision? Do you have an active Homeowners Assoc? If so, they may not allow a commercial vehicle, trailer, equip in the drive or street.

Just a few things to check.

Good luck!

kemco
12-10-2009, 10:33 PM
One more thing about starting a business, at least in TN, not sure about anywhere else. As of Dec 31, 09, if you have a business license you will be required to carry workers comp insurance as well. Even if you are a sole proprietor with no employees. Yes, this makes no sense but I checked it out with two different insurance agencies and that's what is about to happen. Now I've been told if you are an incorporation this will not apply. Basic workers comp ast least in my area is about 800/yr. So it is cheaper for me to incorp at the first of the year. I was going to do it anyway.

But I am still needing someone to explain this one to me. A sole prop with no employees (other than him/herself) will be required to have workers comp insurance at the first of the year... and the sole prop cant even claim unless he/she gets extended owners comp policy. Someone needs to get these useless money grabbing politicians out of office.

Grasshopper49
12-10-2009, 11:05 PM
Kemco
I may have some good news for you, but I am not an expert, so please check with the state labor dept, attorney or someone you trust.

I do not believe the change to the workers comp law applies to lawn maintenance companies, per my understanding. It applies to construction companies, and even then there are some exceptions. http://www.tn.gov/labor-wfd/wc_ConstructionLawNotice.pdf

If you can, go to the above link, which explains the new change, and from there you can get get contact info from someone at the state level to make sure this is correct.

There may be more to the change that I did not see. I also remember hearing about this on the news one night, and all they talked about was construction companies. I would check twice before I paid my insurance company a premium just because they said it was necessary.

Hope this helps.

corey4671
12-11-2009, 12:32 AM
i knew the state was taking over all the licensing the first of the year but this is the first I've heard of this worker's comp bs. just another example of an ins lobby i suppose.
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mowyo
12-13-2009, 08:58 PM
Yesterday's paper quoted my representative as saying they would not be enforcing these new rules yet because their impact on sole proprieterships needed more cosideration.But yeah,it's basically another way to separate people who work from their wallets.

1wezil
12-13-2009, 10:52 PM
:clapping::dancing::clapping::dancing::hammerhead:

XLS
12-14-2009, 12:49 AM
you will also have to tag you truck as commercial ,and tag the trailer and have commercial auto ins, somemore thing to consider.

corey4671
12-14-2009, 01:33 AM
Kemco
I may have some good news for you, but I am not an expert, so please check with the state labor dept, attorney or someone you trust.

I do not believe the change to the workers comp law applies to lawn maintenance companies, per my understanding. It applies to construction companies, and even then there are some exceptions. http://www.tn.gov/labor-wfd/wc_ConstructionLawNotice.pdf

If you can, go to the above link, which explains the new change, and from there you can get get contact info from someone at the state level to make sure this is correct.

There may be more to the change that I did not see. I also remember hearing about this on the news one night, and all they talked about was construction companies. I would check twice before I paid my insurance company a premium just because they said it was necessary.

Hope this helps.

it clearly states that one exception is a sole prop being paid directly by a property owner. that's me! now, commercials are a different ballgame. none of mine currently require me to carry it. It's none of the STATE'S business if I carry it and they can't force business owners to require it. I've been called to quote commercials before that required it and I just simply said no thanks. Not worth it to me to pick up WC just to gain a job that I may lose to some lowballer the following year.

XLS
12-14-2009, 01:41 AM
THANK YOU corey and this is how we save money also we ARE NOT required to have wc on residentials which is 80% of our mix

corey4671
12-14-2009, 01:46 AM
THANK YOU corey and this is how we save money also we ARE NOT required to have wc on residentials which is 80% of our mix

I include churches in my commercial category. I have six churches that I currently work for, two motels an apartment complex and a mini storage as well as a municipal contract. None of which require WC. My mix is probably a little higher maybe 65/35 res/comm. Really would love to get that back down there around your numbers