can we be a corporation? On Fri, 27 Jan 2012 05:51:27 GMT starting feed shack and horse tack. a

begin store for aniamal feed and horse tack, store front

can i buy wholesale with tax id number

  Want to protect my house and other personal assets Retail Trade feed and tack store with 0 employees in Hamlet, NC  , 28345, NC Richmond 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.   My business consists in dealing with real person to person encounters.

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.   Protect your personal assets and avoid suits that might ensue from business consists in dealing with real person to person encounters.

You will need a federal tax IRS number and an assumed business name certificate because you are a partnership even if a partner is your wife?. If you did business with just your surname, you would not need to file a DBA but because your business name has words that reveal additional owners, you need to file a dba. Suffixes such as "& Sons" or & Associates require a filing of a trade fictitious business name. Remember that if you lease personal property, leasing it is taxable on the amount of the lease and you need to obtain a sales tax resale number to collect and pay taxes. All corporation at formation are C corporations unless they elect to be S corporations. An LLC can be a C corporation and taxed as one if it decides so. Since your service includes parts that you must provide the service with you will need to obtain a sellers permit to collect taxes from your clients. Tax only the parts because your service part is not taxable. Your interest in becoming a corporate entity is justifiable and desirable. You will be able to save on taxes and limit your liability if you set up a corporation or form an LLC. If you will qualify as an independent contractor, you will be as any other business and you will need to register your business and get all required tax IDs.

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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?
A: An EIN is an IRS employer as well as business tax ID number.