Start It Right!

BUSINESS LICENSE
To operate your business legally, you should make a visit to your local department of licensing and find out what kind of license fees you have to pay to operate your business. In addition to your business license, your state, county or city government might have some regulations of which you need to be aware. For instance, in Washington state, the Department of Revenue has a Litter tax which it imposes on companies that manufacture and/or sell soaps and toiletries.

BUSINESS INSURANCE
Insurance is another concern for the small business owner. Check your homeowner's or renter's insurance policy to see if it covers your business equipment and supplies at your home. Here are three organizations that offer insurance for small businesses.

Harbour Entertainment & Sports Insurance offers liability insurance for crafters selling at craft fairs and festivals. For more information see their website at www.harbourinsurance.com. Their address is 100 Corporate Pointe, Los Angeles, CA 90230. Phone (310)348-2300.

The National Association For The Self-Employed offers business property insurance. To contact them write to:
The National Association For The Self-Employed
PO Box 612067, DFW Airport, Dallas,TX 75261-2067. Phone: 1-800-232-6273
Visit them on the Internet at: www.nase.com

KEEPING RECORDS
Good record keeping is important for any business. Keeping good records will help you complete your income tax forms correctly, it will help you know how well your business is doing, and it will help you determine how much to charge for the goods or services that you sell. At the bare minimum you should keep the following records:

·Sales records -
Keep a receipt for every sale that you make. The receipt should show the items sold, the sales tax charged (if any), and the total value of the sale. At the end of every month, or quarter, input your sales into a record book, or record-keeping computer program, so that you can quickly tally up your sales for the year.

·Expense records -
Keep a receipt for every item that you purchase for your business. If you can, get a separate business checking account from your local bank. This will also help you keep track of expenses.

·Customer list -
Keep a list of everyone that purchases from you. Then periodically, send them an update about your business (new products you have to offer, sales, shows where you will be exhibiting, etc.)

If you operate a business where you are selling products, you should a record of your inventory and items removed for personal use.

·Inventory records -
The term inventory applies to the following items:
-raw materials
-work in progress
-finished products
-packaging supplies

At the end of every tax year, you will have to identify your inventory and determine the value of your inventory for your tax records.

·Items withdrawn for personal use -
When calculating your inventory for tax purposes, you must subtract the value of the items that you removed from inventory for personal use. The easiest way to do this is to keep a record of the items that you use during the year.

Visit the IRS for more information about recordkeeping at http://www.irs.gov/tax_edu/teletax/tc305.html

SELECTING A BUSINESS NAME
When you apply for a business license, you will have to put down your business name on your application. Spend some time thinking about your business name so that it means something to you and potential customers. Your local business office will tell you the exact fees and process for protecting your name in your state. To protect your name nationally, you need to trademark it. Contact the Patent and Trademark Office of the federal government for more information. You can visit their site on the internet at www.uspto.gov


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