Posted by Harley-CA on January 31, 2001 at 18:41:33:
Greg,
You can set up your business in one of several ways. It’s going to depend on what you plan to do in the future. Remember, you’re not bound to any form of business entity. Some people start out as sole proprietors until they get going and then they incorporate.
You asked for legal advice. I can’t give you legal advice but I can steer you in the direction of people who can. You should call the Small Business Administration office in your town and they will help you for free. Also, find a SCORE office in your town as well (senior core of retired executives). These are both organizations that give business advice to new entrepreneurs for free.
As far as taxes, just be sure to keep good records no matter what form of business entity you choose. I would do the following:
Call the SBA
Call SCORE
Call your local chamber of commerce and ask about what is needed to become a sole proprietor in your town.
Follow their instruction (get biz license, etc)
Once you’ve done that, go do some deals!
Then, as you become more financially liquid, hire an attorney to structure the type of business entity that will best suit your needs for the long haul. (I recommend Nevada Corporation myself).
As far as bookeeping, I would recommend you keep a simple ledger of transactions and file your receipts in a file. You can use a very inexpensive file box from your local office supply store or you can buy a filing cabinet at a garage sale (I don’t recommend the “shoebox method” of keeping receipts. With that method, you simply throw all your receipts in a shoe box and let the accountant sort it out. I recommend you develop good record keeping skills up front.
If you are going to be buying these properties in your name then you shouldn’t need a license at all. As I said, check with your local authorities on these issues.
By the way, the only way you’ll be subject to an audit is if you throw red flags with the IRS and even then it has to be a substantial amount. Just make sure to follow your local rules and then get incorporated in Nevada as soon as you can. Once you’re a Nevada Corp., many of those worries no longer apply.
You can learn more about Nevada Corporations by going to: http://www.corporateservicecenter.com/
They are one of the best firms for doing Nevada Corps and you can learn a lot from just reading their site.
I Hope this helps you. Keep us posted.
Harley-CA