accesory accesory? On 2/20/2012 7:11 AM starting Diana's Closet. a I have a web site I will buy new and used shoes and accesorries to sell online. From my home       Retail Trade accesory store with 0 employees in Indianapolis, IN  , 46226, IN Hamilton County I do not want to pay excessive taxes because I am self employed and I am subject to self employment taxes. Is there a way to avoid paying it.       I want my clients and other business I deal with to respect me and my business.     To begin, you need a sales tax id number because you sell taxable items.  Taxable merchandise is anything you lease or sell and it is touchable. Second, a business tax registration is required. That registration is different than sales tax, income tax, or employement tax.  It is also called a home occupation permit or business permit license.  Finally, you need to register a ficitious business name, but, better, instead, you could register an S  or C corporation or set up an LLC. If you create an S corporation you will not pay excessive self employment taxes because instead of salary you can pay yourself in dividents. Keep in mind that you still need to pay yourself a reasonable salary as defined by the IRS.     Set up a corporate business entity such as an LLC or corporation in order to be respected as a business.     Click Here to Submit It. Frequently Asked Questions: Q: I started a business as a partnership but never really took off. Do I still need to file an IRS return? A: If you filed for a a partnership but never started a business, you need to file a tax return anyway and just fill out the gross business income as zero. Otherwise the IRS will charge you with a penalty for non filing the return. Q: What if the independent contractor is an LLC or corporation, do I still need to send them a 1099 form? A: To be safe, yes, send everyone that does any work for you for more than $600 a 1099 form. Q: I hired someone for business consultation last year and it turned out my business was her only client. Do I treat her as an employee or as an independent contractor? A: The test is not whether he has only one client but whether she acts as an independent contractor. That is whether she works without supervision and uses her own tools or equipement. Q: What is an EIN Used For? A: You can use an EIN to pay employment taxes withheld and use it as a corporation, LLC or business tax ID number as a sole proprietor or partnership or you can combine any of the previous uses of an EIN. IN Tax ID Number. IN Tax ID.