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Setting Up A Business
Dec 16, 2019
Setting Up A Business – More than just checklists!
There are tons of how to’s lists out there on the world wide web.. but really it takes more than a list to grasp the understanding of setting up a business and the start of the business ownership journey! It can be overwhelming looking at the lists and the questions that rattle our brains can cause a lot of discouragement. I work with entrepreneurs and business owners on a weekly basis in tackling this hurdle and getting their businesses going and operating successfully.
The first step is “creating what you want the business to do” are you providing a product and/or service and what will set you apart from the other 20 businesses doing the same thing?
The first step is “creating what you
want the business to do.”
The second step, (I should say question) is are you willing to sacrifice the time to commit to working your business, rising early before the family to put in the time, or going to bed late to put in the time. If you’re like most business owners you have a job, a family or some type of obligation that will require you to MAKE time to run your business until you can do it full time. If you’re able to work the business Full time, Yippy Yayy you are ahead of the game!
Third, do you have a catchy marketable name for the business, check the availability on your states business site before filing business formation forms, this will save you time should the name be used already. Understanding marketing and social media are essential to growing your business. Word of mouth is always the best, but the social times require a social media presence and website access to your business. There are free website and marketing tools available, research is the key! (i.e. google it)
Fourth, consider your business structure. You will have to consider what is important to you, is it tax write-offs, is it liability protection of your business and personal assets, is it ownership of the business or is it all of the above. The list below is a link from the SBA.Gov site providing information on business structures with brief descriptions (please note the brief descriptions are not to be used to make a final decision but provide insight, you will want to review these options with a CPA or Attorney before making a final informed decision)
https://www.sba.gov/business-guide/launch-your-business/choose-business-structure
Fifth, after you decide the business structure take the leap and file the business with your State, and obtain an EIN from the IRS. The EIN will give the entity its own Employer ID Number for tax purposes, to be used for vendors, creditors, banks and other lenders. This is a step to differentiate your business from your personal assets.
After you receive the Articles of Organization or Incorporation from the State and the EIN letter (which can be obtained online at www.irs.gov/EIN ) You can take the two forms to the bank and open your business account. I business account is essential to separating your business from your personal assets. I tell clients to run everything through the bank statements, meaning post all deposits to the bank whole before you deduct funds, and expenses can be purchased with a debit card or checks, and bill payments can be made by ACH (direct from a bank account), or debit card. The bank statements will summarize all your activity making it easier for an Accountant or bookkeeper to reconcile your statements and provide the important financial statements needed for you as owner to make good business decisions.
Sixth, since we’ve opened the door to the accounting aspect of your business. It is imperative that you gain an understanding of Accounting and how important it is for your business. If you don’t know your Numberz (pun intended) you will not know if you are making a profit or sinking in debt, if you can meet payroll at the end of the week, or meet business obligations at the end of the month. Accounting also tells you if your prices are enough, should you be charging more to make a profit. Seek out an accountant to review and answer questions early in the game, it will save you a lot of headache!
The listed six steps are the “first steps” in setting up your business.. the next is building and sustaining your business… if you would like a consultation with us, please contact nkirkland@bythenumberzcpa.com or give me a call at 586.296.0771.
Are you a business owner missing out of qualifying deductions because you are not aware of what can be deducted? I have compiled a listing of business deductions, a few that go overlooked year after year to assist business owners in maximizing the taxes, and reducing tax liabilities. Many of the deductions apply to independent contractors, freelancers, limited liability companies, corporations, and partnerships. Click here for you free download of business deductions. For more information contact me nkirkland@bythenumberzcpa.com
Beginning January 1, 2020, the IRS has issued a new W-4 form. This is significant as the recent Tax Reform eliminated personal exemptions and doubled the standard deduction when filing your personal taxes. It is recommended that a new W4 be filed with your employer to ensure the proper withholding is deducted under the new code. It is highly recommended the new form be filed with your employer if you: Work for more than one job If you spouse also works and you file jointly If you claim the child tax credit or other tax credit If you have high income and a more complex return Completing the Form I have received a lot of calls asking “what to do with this new form”, so I have included some instructions to assist people. You must complete steps 1 and 5. Steps 2, 3, and 4 are optional but can be helpful in ensuring your tax withholding more closely matches your tax obligation. When you fill out Step 1 only, your withholding will be computed based on your filing status’s standard deduction and tax rates, with no other adjustments There are certain situations that increasing the withholding should be considered: You hold more than one job at a time or you and your spouse both have jobs (Step 2) You have income from sources other than jobs or self- employment There are certain situations that decreasing the withholding should be considered: You are eligible for income tax credits, child tax credit or credit for dependents (Step 3) You are eligible for deductions, such as itemized deductions, IRA contributions or student loan interest deductions It is also a great idea to use the Tax Withholding Estimator to help ensure maximum accuracy. The link is below. Note you will need your latest paystub (to enter the federal tax withheld from last check, and the YTD federal tax withheld). For more information contact me at nkirkland@bythenumberz.com.
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nkirkland@bythenumberzcpa.com
586.296.0771
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Fairburn, GA 30213
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Are you a business owner missing out of qualifying deductions because you are not aware of what can be deducted? I have compiled a listing of business deductions, a few that go overlooked year after year to assist business owners in maximizing the taxes, and reducing tax liabilities. Many of the deductions apply to independent contractors, freelancers, limited liability companies, corporations, and partnerships. Click here for you free download of business deductions. For more information contact me nkirkland@bythenumberzcpa.com
Beginning January 1, 2020, the IRS has issued a new W-4 form. This is significant as the recent Tax Reform eliminated personal exemptions and doubled the standard deduction when filing your personal taxes. It is recommended that a new W4 be filed with your employer to ensure the proper withholding is deducted under the new code. It is highly recommended the new form be filed with your employer if you: Work for more than one job If you spouse also works and you file jointly If you claim the child tax credit or other tax credit If you have high income and a more complex return Completing the Form I have received a lot of calls asking “what to do with this new form”, so I have included some instructions to assist people. You must complete steps 1 and 5. Steps 2, 3, and 4 are optional but can be helpful in ensuring your tax withholding more closely matches your tax obligation. When you fill out Step 1 only, your withholding will be computed based on your filing status’s standard deduction and tax rates, with no other adjustments There are certain situations that increasing the withholding should be considered: You hold more than one job at a time or you and your spouse both have jobs (Step 2) You have income from sources other than jobs or self- employment There are certain situations that decreasing the withholding should be considered: You are eligible for income tax credits, child tax credit or credit for dependents (Step 3) You are eligible for deductions, such as itemized deductions, IRA contributions or student loan interest deductions It is also a great idea to use the Tax Withholding Estimator to help ensure maximum accuracy. The link is below. Note you will need your latest paystub (to enter the federal tax withheld from last check, and the YTD federal tax withheld). For more information contact me at nkirkland@bythenumberz.com.