TATER

Hey guys, I was hoping someone around here might have a small business and could throw a little info my way.
Let's say i was going to start a small business. ie: Mowing Lawns, washing cars, babysitting the neighborhood teenage daughters, what have you.

If this is a business I advertise, what's the protocol? If I run it out of my home, do I need a permit? Would I pay taxes to the city of Katy, Harris County, or Texas in general? If I paid myself a salary, and then paid taxes on that, what do I do? (I should ask my mom that, she's an accountant. I think it's a 1099.)

Basically, I'm trying to start a small, home based business, and since this is a venture never travelled by me, I'm not sure which direction to go first.

By the way, I've got no money tied up into anything and no overhead. If the business fails I lose nothing. So please don't tell me how much I stand to lose, I assure you the thought doesn't cause me to lose sleep at night. Besides, I only really think about what I stand to gain.

pdanrichey

iTrader: (4)

Depending on what you do, start a LLC or incorporate yourself to take away liability should something go wrong. Pay yourself a salary out of the business or take dividends from the business (taxable as ordinary income). You can file a schedule C (self employed) to pay taxes depending on what route you go...but with a schedule C or 1099 income, you get to write off expenses towards the money you get paid.

These however are THE MOST audited types of tax returns if you show massive losses and no gains. Texas doesn't have a state tax and I don't think there is a local tax either. You will be required however to pay property tax on the items your business owns if you're incorporated (usually small).

You could go DBA, but then if you're mowing a lawn and a rock flies out and wacks someone in the head, you're personally screwed.

Good luck.

TATER

Thanks for the info. I'll do some research on LLC, DBA, or Inc.

I'm not worried about hitting someone in the head with a rock, or chopping a hand off, or knocking up someones 18 year old daughter. (Well, maybe not the first two) so a DBA might be the way to go. I'll be doing most of my work with personal equipment, and in my home, so if the house burns down or gets broken into, it'll suck, but the house is insured.

I'm off to bed (Why do classes always have to start at 8?) so I'll do some reading tomorrow. Thanks again for the help.

Edit: If it makes a difference (I'm sure it does not), this is a weekend/test venture. To supplement what I make now at my mediocre job.

red90cobra

iTrader: (36)

if your mom is an accountant just ask her!!!

TATER

It's not that simple. Laws in Arkansas and laws in Texas are different (tax laws.)
Also, she's not going to know anything about zoning restrictions, business permits, etc.

LT1wannabe

iTrader: (2)

You'd be surprised. Accountants range from keeping books to CFO/CEO's.
Also, about paying the property taxes, that's true. BUT, you can write off a whole lot of stuff too. It evens out if you know the system.

TATER

Thanks guys. I'll look it over. If anyone has any other tidbits of info, I'm all ears.