Information Starting your own business – 6 steps

Information Starting your own business

Information Starting your own Business

Starting any kind of business can be daunting and scary. Usually a business starts as an idea in your head and you have to translate it out into a working project. The steps that I am listing here are to give you information starting your business and to understand the legal aspect of starting your own business.

While building your website, there is going to come a point where your website is actually making money. Be sure to read the next article I am going to post about "When does a Hobby become a Business."

Business Plan

 

Your Business plan is a set of information describing mostly your financial side of your business. It will contain the following:

  •  Income Statement:     Which is revenue minus expenses or costs  equals net profit.   r - e or c = net profit
  • Balance Sheet:          Your balance sheet is a listing of what you own, owe and what your company is worth.
  • Cash Flow Statement:           This is how the money is going to pass through your company. It is an explanation of how your company makes money.

Where will your business be located?

It doesn't matter if your business is a online business or an office business, it has to have a physical location. So, usually an online business is considered a home business. You have decide how you want to record the location of your business.

What Type of business do you plan for it to be?

This topic can get heavy fast and I really just want to briefly mention it to you. With an online business just like any other, you are going to want to determine what type of business you are. This type is defined for tax purposes. You have to declare whether your business is going to be a single proprietary, INC., LLC,  Partnership or Corporation. I do not want to go into each one since I am not a lawyer or anyone with knowledge as to why you would pick which. However, here is a great link that will give you information to make your determination for your business.  Small Business Administration

Register Business Name  "Doing Business As"

Now that you know what type of business you are going to be, you can now do these last three steps. You will usually do them all at one time. I broke them up to help explain them just a bit. By now, you already should have a name for your business. For an online business, most pick their domain name as their Doing Business As name. Sometime though, you may want to just change your name. So, you have some choices you can make when deciding what you want to register your name as. I will use myself as an example. I would register my business name as Eden Williamson DOING BUSINESS AS Websiteinthesand.life.

Register for state and local taxes

You will have to look into your state and local laws to see if and where you must register to pay state and local taxes. Depending on the business type you picked, you may need to apply for a state tax ID to use to file your business taxes. Your state or county office should be able to tell you what you need to do.

Business License or Permit

YES!! Now you get to go and buy your Business License or Permit. Please check your state as to where you need to buy yours. Mine was county instead of local. You will need your Doing Business as register your license properly. That is why we do it first.

 

I want to make a quick disclaimer. I am not a lawyer or anyone with complete legal knowledge of all this information. If you are not sure on what type of business to pick an Accountant would be a good person to speak with.

For the legal information concerning taxes and business licenses, be sure to contact your local Chamber of Commerce to find out what you need to legally do to get it set up. Some states may handle online businesses different than others.

I am hoping that this article has helped you to understand some of the information starting your own business. Be sure to read my next article also on "When does a Hobby become a Business."

by: Eden

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