View Single Post
Old 07-08-2013, 12:15 PM
Cody S's Avatar
Cody S Cody S is online now
LawnSite Senior Member
Join Date: Mar 2013
Location: Michigan
Posts: 744
Basically by taking personal checks that is money made through your "business" you are doing what they call "tax evasion" if the IRS was ever to come down on you. Here is what I would do to solidify your business from the start to give you a solid foundation. You'll never be a business with taking personal checks and cash.

1) Figure out a business name, then form your business. Don't waste your time on a DBA if you want to have an actual company. There are many forms of incorporation to choose from, but your best bet is to become a Limited Liability Company (LLC). It doesn't cost much to form, and you can even do it online. The tax rate isn't to bad, and you do all your business tax through your own personal 1040 at the end of the year.

2) File for a EIN Number. Every business needs one. Sales Tax license is completely dependent upon what your state requires. For example, I don't need one for what my company offers. Now say I wanted to run my service aspect of this business, and also open up a landscape supply store, then I need to have a Sales Tax License. Basically, if you are offering a PRODUCT, chances are you need a Sales Tax license. If you are offering a SERVICE, you most likely don't. Like I said, just check with your state.

3) Now you're an LLC and have your EIN, now you can accept checks with your company name! But you can't deposit them in your personal acct or cash them at a convenience store, so go open up a business checking and savings acct at your local bank.

4) So you have a licensed business, an EIN, and a bank acct, youre ready to rock and roll....almost. Now you need a Commercial Liability Policy. Find a policy with a $1 to $2 million aggregate. Throw your truck on the policy. It will get classified as commercial/personal use. Youre trailer will be covered while being towed.

5) Now you have a business name, it's registered with the State AND IRS, you have a bank acct that can track everything for the IRS, and you're insured. You can do this in a matter of a week, and the only thing it costs you is whatever you pay to form the LLC (Like $200).

There are many aspects to running legitimately, but this is a good start.
Bob-Cat & Exmark
Just building piece by piece
Reply With Quote
Page generated in 0.04194 seconds with 8 queries