Making Your Internet Business Legal A Simple Guide

Making Your Internet Business Legal A Simple Guide

When I first started thinking about beginning an​ online business,​ I didn't think about the​ legalities. I knew I wanted to​ make some extra money. Lots of​ money! Sound familiar? So,​ I began doing some research. One day I ran across the​ headline of​ an​ article that I will never forget. it​ read,​ "Your Business; Get Legal or​ Get Cheated"! as​ if​ that were not scary enough,​ there was more to​ come. as​ I began to​ skim the​ page,​ I was horrified to​ see the​ words,​ "Tax ID number." Tax ID number? I don't know anything about that! at​ that moment,​ I thought the​ dream of​ owning my own business was just that,​ a​ dream. I began to​ read more of​ the​ article and it​ actually sounded pretty simple. I was surprised to​ find how simple it​ really was. There are two things you​ must have in​ order to​ make your business legal.

The first thing you​ need to​ do is​ file your business name with your state. This is​ referred to​ as​ a​ Doing Business as​ (DBA) or​ Fictitious Name depending on​ your state of​ residence. it​ is​ as​ simple as​ going down to​ your local County Office building to​ register your business name. you​ will be charged a​ fee. I payed $19 in​ my county which is​ in​ North Carolina. you​ will need to​ find out the​ cost of​ the​ fees in​ your county. you​ can also file a​ corporation with your state. All states have a​ website that gives information about this. Most of​ the​ time you​ can even file online. a​ corporation will give you​ more protection for your business but is​ more expensive.

The second thing you​ need to​ do is​ obtain a​ Tax ID number. Most states require you​ to​ have one. in​ my state it​ is​ called a​ Sales Tax and Use Certificate. in​ other states it​ could be called a​ Seller's Permit. What is​ the​ purpose of​ this number? it​ allows you​ to​ collect sales tax on​ items you​ sale within your own state. you​ will use this to​ file and pay taxes on​ the​ items that you​ sell. you​ can obtain a​ Tax ID number by visiting your local State Tax office. you​ should be able to​ complete the​ process and have your number within minutes for a​ minimal fee. Since the​ process was still a​ little scary for me,​ I went to​ see my accountant and he filed the​ papers for a​ fee of​ $25. I thought it​ was worth every penny not fill out the​ forms myself. if​ you​ buy products from a​ wholesaler,​ you​ will need to​ give them a​ copy of​ your Sales and Use Tax Certificate or​ Seller's Permit. This proves to​ the​ IRS that they are not required to​ charge you​ tax on​ products that they sell to​ you​ for wholesale prices.

So,​ there you​ have it! Those are the​ two things you​ will need to​ make your business legal. Not too scary and painful,​ I hope. Easier and cheaper than you​ thought,​ right? There are a​ couple of​ other things to​ consider when starting your business,​ especially if​ you​ are serious about making money online.

Opening a​ business bank account is​ optional,​ but I highly recommend that you​ do. For a​ while,​ I didn't have one. you​ will need the​ documents with your business name. Most banks offer business accounts and only require a​ deposit of​ $50 to​ $100. I opened a​ free business checking account. it​ included 175 transactions per month without being charged extra and no minimum balance was required to​ keep the​ account open. if​ you​ need more transactions there are other options available. Shop around for the​ best deals. One thing to​ take into consideration is​ convenience. For instance,​ if​ you​ spend a​ lot of​ time in​ other towns or​ states,​ make sure you​ open an​ account with a​ bank in​ those locations if​ possible.

If you​ are going to​ do business online you​ are going to​ need a​ merchant account to​ accept credit card payments from your customers. you​ will not be able to​ earn much money without one. People who shop online use credit and debit cards to​ get what they want as​ quickly as​ possible. a​ merchant account will collect payments from your customers and deposit them into your business bank account. When applying,​ you​ will need to​ supply all of​ the​ information I have discussed in​ this article. There are,​ of​ course,​ fees for using a​ merchant account. There will be a​ one time fee to​ set up an​ account. This amount can vary from a​ couple of​ hundred to​ a​ few thousand dollars depending on​ your needs and who you​ choose to​ set up your account. you​ will also be charged an​ average of​ 2.2% of​ the​ amount charged to​ your customer's credit card plus around 30 cents for each transaction. This is​ what my bank would charge if​ I opened a​ merchant account with them. you​ will need to​ shop around to​ find the​ best rates and plan for you. I do not have a​ merchant account but am still able to​ accept payments online. I currently use Paypal to​ accept transactions. Go to​ their website to​ read about what they have to​ offer. it​ has it's advantages and disadvantages,​ but I digress. That is​ another topic.

I hope you​ enjoyed reading this article and found it​ to​ be helpful in​ your business endeavors. I wish you​ the​ best of​ luck on​ your journey to​ success!

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