662, RE: Stubborn determination goes blank... or Starting a Small Business|
Posted by CCA, Tue Jan-06-09 09:08 AM
It is very easy these days to start a small business.
Sole Proprietorship vs Legal Entity
Hinges on paying taxes. As a S.P. you must remember to make timely quarterly payments based in the income you are producing. As a L.E. you can pay yourself and will have to make payroll tax payments for the business.
First stop should be your State website. Every state these days has a whole range of material for starting a company. You can actually prepare Articles of Incorporation right online (no need to hire an attorney). But more importantly they have lots of information for deciding which way to go. Usually a single person company is a Corporation who elects to be a Subchapter-S. This means the profits or losses can be deducted from the owners tax return. And this makes it easy to keep your business expenses separate and deductible from the business income.
Also online is www.irs.gov where you can apply for an employer identification number (EIN). Again the IRS has tons of documents to understand the best way to start a business.
But before you start anything you need a.) a good idea for a business, b.) a good plan to implement the idea and c.) some seed money to get it going. Without these you will not get far.