Forgot Password
Pentax Camera Forums Home
 

Reply
Show Printable Version Search this Thread
06-14-2014, 12:33 PM   #1
Forum Member




Join Date: Mar 2014
Posts: 73
Business registration

I am looking to buy my business license but I'm not sure which direction to go. Do you think it's wise to get a sole proprietorship and liability ins? Or should I just get a llc?

06-14-2014, 12:36 PM   #2
Administrator
Site Webmaster
Adam's Avatar

Join Date: Sep 2006
Location: Arizona
Photos: Gallery | Albums
Posts: 42,385
If you're in the US, a LLC is usually the way to go for small businesses. The paperwork is minimal and you can have it be a sole proprietorship or another ownership structure.

Adam
PentaxForums.com Webmaster (Site Usage Guide | Site Help | My Photography)



PentaxForums.com's high server and development costs are user-supported. You can help cover those costs by donating. Or, buy your photo gear from our affiliates, Adorama, B&H Photo, or Topaz Labs, and get FREE Marketplace access - click here to see how! Trusted Pentax retailers:

06-14-2014, 12:36 PM   #3
Site Supporter
RGlasel's Avatar

Join Date: Sep 2013
Location: Saskatoon
Photos: Gallery | Albums
Posts: 1,332
It would be helpful to know what kind of business you plan to operate, and where in the U.S. you will register your business.
06-14-2014, 12:56 PM   #4
Forum Member




Join Date: Mar 2014
Posts: 73
Original Poster
Portrait photography -- no studio yet.

06-14-2014, 01:15 PM   #5
Pentaxian
Miguel's Avatar

Join Date: Sep 2007
Location: Near Seattle
Photos: Gallery
Posts: 2,722
QuoteOriginally posted by julbelle Quote
I am looking to buy my business license but I'm not sure which direction to go. Do you think it's wise to get a sole proprietorship and liability ins? Or should I just get a llc?
How much gross income does your business plan project for the end of the initial year?

I don't think the legal entity type matters all that much to start if it is just one person, unless your answer to the above question is substantial--say $100K. It would behoove you to have liability and equipment insurance regardless. Be sure to register your business name with the state as well. And grab related domain names too. Get a bookkeeper to get things setup right as well..

M
06-14-2014, 01:47 PM   #6
Site Supporter
jatrax's Avatar

Join Date: May 2010
Location: Oregon
Photos: Gallery | Albums
Posts: 10,717
Each state will have different requirements so you should first check with your state's website. Some have "How to do business in xyz" pages that are very helpful. The type of legal entity is not too important if you have no employees and have a relatively low volume. An LLC is more complicated and has a cost involved, a sole proprietorship is simpler and has minimum costs. An LLC provides in some cases protection that a sole proprietorship does not but if you are the only employee then it can get a little fuzzy. Either will work. Also check if your county/township/city also requires a business license. Some do, some do not.

If your state charges sales tax, then you will likely need a state tax number and be required to charge, collect and remit sales tax. But check, not all states are the same.

Make sure your "business name" is available, that information can be searched on at your state's website. If available, you should register that name ASAP. Likewise make sure any domain names that you will need are available and register those as well. You do not want a legal business name that cannot be used on a website because someone has already registered it.

Talk to an accountant/bookkeeper and possibly a lawyer to get things setup. Think about how you will handle bookkeeping, payroll, banking, receipts, credit cards. Have a separate checking or Paypal account just for the business. Start to think about how you will separate business expenses and personal expenses. The business is a separate entity and must be treated that way. Always buy business stuff with the business's money and your stuff with your money.

Insurance is extremely important if you will be doing portraits, your home owners will likely not cover you unless you specifically tell them you are running a business (assuming you are working from your house). Your equipment will also (possibly) no longer be covered by your homeowners insurance since it is now business equipment. You will need business insurance, equipment insurance and most likely a personal liability policy to protect you from law suits.

---------- Post added 06-14-14 at 01:49 PM ----------

This might help: Sole Proprietorships vs. LLCs | Nolo.com
06-14-2014, 01:57 PM   #7
Senior Moderator
Loyal Site Supporter
Parallax's Avatar

Join Date: Apr 2008
Location: South Dakota
Photos: Gallery
Posts: 15,545
LLC gives you essentially the same benefits as an s corp, but a lot less beaurocracy and red tape.
06-14-2014, 02:17 PM   #8
Veteran Member
OregonJim's Avatar

Join Date: Mar 2009
Location: Willamette Valley, Oregon
Posts: 1,329
QuoteOriginally posted by jatrax Quote
hink about how you will handle bookkeeping, payroll, banking, receipts, credit cards. Have a separate checking or Paypal account just for the business. Start to think about how you will separate business expenses and personal expenses. The business is a separate entity and must be treated that way. Always buy business stuff with the business's money and your stuff with your money.
^^^^^ This is important. ^^^^^

The rest of it varies by state, so talk to a local accountant/bookkeeper for advice. Also, think about the size of your business now, and where you want it to be in five years. Here in Oregon, I set up an LLC but, as they say, ymmv.

06-14-2014, 03:38 PM   #9
Veteran Member
NicoleC's Avatar

Join Date: Oct 2013
Location: Madison, AL
Posts: 448
My lawyer felt an LLC was overkill for my given dollar values of assets and likely worst case scenario. (Although she was happy to collect a check if I wanted one.) I do carry $1 million of general liability on my business policy; I don't think you can get lower. Pay the extra and schedule your equipment, and most policies will cover drop/incidental damage to your gear.


Sorting through all the paperwork and requirements at the state, county and city level was a pain. If your city has a Chamber of Commerce or similar entity, check with them to see if they offer start-up business classes or coaching.
06-15-2014, 03:43 PM   #10
Pentaxian
Lowell Goudge's Avatar

Join Date: Jan 2007
Location: Toronto
Photos: Gallery | Albums
Posts: 15,397
Not sure the rules ar the same in canada or the USA BUT look at making sure your personal posessions are separate from business. Usually a sole proprietarship has no separation, and you can risk all of your posessions if the business goes down. In canada it costs about 1000 to be incorporated, and 200 for a sole proprietarship. But it is worst the money to have the legal separation between you and the business
06-15-2014, 04:58 PM   #11
Site Supporter
RGlasel's Avatar

Join Date: Sep 2013
Location: Saskatoon
Photos: Gallery | Albums
Posts: 1,332
If you are the only owner and operator of your business, you don't have true legal separation, regardless of how your business is registered, in either the US or Canada. The legal term is lifting the corporate veil, and you can be held liable for negligence, even if your business is incorporated. But unless your creditor is the government, no one can go after your personal possessions to collect on your debts, unless you gave the creditor the right to do so when you made the purchase. The main advantage of a single owner incorporating is to reinvest profit into the corporation, instead of it becoming taxable income for the owner.

As the sole owner of a business, there is no reason to not take advantage of free advice from municipal/state/provincial small business agencies. In Saskatchewan, I registered a sole proprietorship for $55, renewable every three years, no annual filing required. If you have more than one owner in the business, you really need to hire a lawyer to draw up an ownership agreement for all owners, regardless of the corporate structure you decide to adopt, so registering the business will probably be less costly than your legal fees. The main benefit of incorporating a business with more than one owner, is to protect individual owners from the liabilities of other owners, so that once you lose your investment in the business, your other possessions are free and clear. However, you are still liable for your own negligence, and if your insurance company can prove you purchased insurance to avoid liability for negligent actions you were already aware of, or you deliberately failed to take action to avoid negligence, they will refuse to assume your liability. E&O or general liability insurance is often a requirement in order to do business with certain classes of customer, and puts you on a level playing field if someone tries to take advantage of the legal system to get financial compensation from your business without your consent, so I'm definitely recommending getting insurance, but don't think you will get away with anything by doing so.
06-15-2014, 05:56 PM   #12
Pentaxian
Not a Number's Avatar

Join Date: Mar 2012
Location: Venice, CA
Posts: 4,181
If you are in the US the Small Business Administration website will walk you through what you need to do.

You will need licenses and permits down to the local (county/city/town) level depending on where you live and plan on conducting your business from.

Starting a Business | SBA.gov
Reply

Bookmarks
  • Submit Thread to Facebook Facebook
  • Submit Thread to Twitter Twitter
  • Submit Thread to Digg Digg
Tags - Make this thread easier to find by adding keywords to it!
business, camera, check, equipment, expenses, insurance, money, pentax help, photography, sales, stuff, tax, website
Thread Tools Search this Thread
Search this Thread:

Advanced Search


Similar Threads
Thread Thread Starter Forum Replies Last Post
Business Help Needed SashasMom Photographic Industry and Professionals 2 04-20-2014 08:28 AM
Nature Taking care of business! Supakatti Post Your Photos! 3 03-08-2014 11:47 PM
Build Yourself A Studio Business! Rupert Photographic Industry and Professionals 84 08-25-2013 12:19 AM
General business help? Bcrary3 Photographic Industry and Professionals 9 05-09-2013 07:42 PM
Another Nifty Fifty Back in Business Paleo Pete Pentax SLR Lens Discussion 3 12-05-2012 08:10 PM



All times are GMT -7. The time now is 01:45 PM. | See also: NikonForums.com, CanonForums.com part of our network of photo forums!
  • Red (Default)
  • Green
  • Gray
  • Dark
  • Dark Yellow
  • Dark Blue
  • Old Red
  • Old Green
  • Old Gray
  • Dial-Up Style
Hello! It's great to see you back on the forum! Have you considered joining the community?
register
Creating a FREE ACCOUNT takes under a minute, removes ads, and lets you post! [Dismiss]
Top