Does a reseller need to have a company liscence to operate?

And does it have to pay taxes?


Thanks

Probably depends on where your located.

As far as I know, in NYS (US) theres no tax on hosting or dialups, but there is on the design work.

Then again, NYS has given me about a dozen -different- answeres, and my accountant can only say 'ask NYS'.

Well, without really knowing what country you live in, I'll assume it's the US:

1.) In general you do not need a "company license." There could be some local requirements; you could probably start investigating that by contacting your county clerk's office. Depending on exactly what jurisdiction you live in, you'll probably at least need to file a dba or "fictitious name certificate" unless you simply operate with your own name.

2.)Yes, everybody has to pay taxes.

As in operating any business, you'll have to decide what type of business entity yours is going to be: sole proprietorship, partnership, LLC, corporation... which of these you choose (and each has its advantages and disadvantages) affects the tax situation you'll be faced with.

The short answer is that it's too complicated a subject to answer here! Actually, a good approach would be to call or drop by your local library, and ask someone in the reference department for information on starting a business.

Another point to note is that some companies won't deal with you as a business if you can't produce a valid resale certificate.

They do have some nice bennis: Tax exemptions, delay payments, lines of credit, etc. as you progress.

note: never give a geek a line of credit at a book/software shop. its a -bad- thing. <G>

Originally posted by Kaith Sutai-Rustaz
Another point to note is that some companies won't deal with you as a business if you can't produce a valid resale certificate.

I don't think you need a resale certificate for services. It's usually just for physical merchandise.

And yes, many if not all supply and services businesses won't deal with you unless you can prove you are a registered business. That can mean a copy of your business certificate, sales tax license, etc.

Like wise, if someone approaches you for a better deal claiming to be a business you can (if you wish) stand firm until they produce documentation.

In the US. You'll need to register with the state your in. File a DBA (Doing Business As) with the State Secretary. Far as sales tax goes I don't have to include that because it's a service being provided. Your county may require you to file for a license also. Best thing to do is goto a lawyer they know about the laws or can find out exactly what you'll need and it's going to be the safest bet. You can probably find scottlaw on here I believe he's a lawyer and might be of assistance.

::Edit::
Oh forgot to mention (http://sba.gov) Nice resource
::/Edit::

[Edited by Newbie on 02-14-2001 at 01:50 AM]

For taxes, you are going to have to pay the feds for the income you receive, that is always a given... How you pay it though depends on how you setup your business. Most of the time, it is best to setup your company as an LLC. Your taxes are usually lower then a corporation, there are less formalities to follow, plus you get the protection of personal assets just like a corporation.

You don't really need a lawyer to setup an LLC, though they can be helpful The form is a simple one-page form in most states that consists of filling in your name, address, company name, and signing it. Just contact the Secretary of State (or branch office in your state) and they will tell you how to do it. For state and local taxes, you should contact the revenue office in your state (or whatever they call it in your state). They will usually be more then happy to help you since it means they will get money from you :)

I would recommend that anyone starting a business consult a lawyer as to the proper form of company to establish... It should cost less then 500.00 and is well worth it if you were ever to get sued since the proper form of company can protect your personal assets which is usually the key.

For taxes and other matters, a lawyer is really an over-kill. I would find a good CPA in your area. They will charge less then a lawyer and usually knows more then a lawyer about taxes :) I use to do my own taxes, bookkeeping, etc. for my company but found a CPA can usually pay for themselves if they are good.

Note: None of the above should be considered as legal advise... There is no legal relationship between us... You should contact an attorney... etc. etc. etc.

Scott

;)
Like I did: don`t think about that until you`ve got it going!

Kaith webhosts and other internet related utilities dont have to pay taxes. And they get big tax breaks to expand there company. New York is trying to attract businesses like that. As far as resellers go i am not sure about them. If you have a NYS Tax ID number then you should have received an update about 6 months ago regarding this issue via the USPS.

Dang. Missed that one. My post office on the other hand may have eaten it. They do that a lot. You wouldn't happen to have the bulletin # would ya?

danke!

how is S Corporation, which file tax as individule? It seems better than both C Corporation and LLC.
To form a LLC is more expensive than Corporation in NYS.
But to form a corporation need formility.

Aaron, this is my advice to you... there is no *one* form better than another per se. What matters is what will work for you the best, in your situation. I suggest you talk to a tax professional and discuss the various forms of organization. Doing this will cost you a bit of money (though you may be able to get a free consultation), but will be worth it in the end.

Aaron,

IMO you should consult a lawyer. You don't need a $500/hr guy, just someone who knows the details of Corp and LLC for NY.

We're in NYS too and yes LLC is more expensive to setup. But there may be other good reasons to go with it over Corp. Or not, depending on your situation and requirements.

I'm not a lawyer or accountant but, as I understand it, the main tax difference between an S corp and a C corp is your tax filing status. You setup a corp and then elect either C or S tax status. A C-corp pays tax on it's earnings at the corp tax rate with is very high now (upper 30's percentage range, not sure the exact number). With an S-corp the income "flows through" directly to the shareholders. Thus the shareholders and not the corp pay tax.

There are some other differences too which may make a C or S corp better or worse for you.

You shouldn't take filing a corp or LLC so lightly. Too many people do that and get burned later. It's worth spending a few bucks to make sure you're getting what you want (and what you think your getting).