Business accounts and business licenses??

catspaw

Hey -- I *need* to separate out my funds from my business money and in such comes in *dum dum dum* a business checking acct (w/ check/atm/visa card of course). Problem is, most of the local credit unions (they are an infestation around here!) require a business license with the application. I checked into state laws and 'Photographer' is NOT listed as one of the professions for licensing.

So, what have YOU run into??

In this case, I'm doing a P-Corporation (personal), filing under my own SSN and including on my own taxes. I work in the financial area for my 'real' job (erm, for now), so most of that stuff is familiar to me. But business licensing for photographers????

dbd

Tangible sales

catspaw wrote:

...
But business licensing for photographers????

Do you sell tangible items for which you are required to have a state sales tax license number?

Dale B. Dalrymple

ChatKat

Bus Lic
An accountant is a very valuable tool for a photographer. They have all the right answers for these questions. Photographers aren't the best source of tax and legal advice because it's frequently not applicable to the person asking the question.

Business Licenses are required of any business in my jurisdiction, in my case, the City of Los Angeles.

There is no corporation that uses your personal social security number. There is an entity called a Sole Proprietorship. You file a tax form called a Profit and Loss from Business with your personal tax return. The other common name for that form is called a "Schedule C".

There are other kinds of entities but the one that is right for you is best decided with the help of an accountant because everyone's personal tax situations are different.

BTW - I am an accountant.

catspaw

dbd wrote:

Do you sell tangible items for which you are required to have a state sales tax license number?

Dale B. Dalrymple

Everything is sold through SmugMug, so ... no?

catspaw

ChatKat wrote:

An accountant is a very valuable tool for a photographer. They have all the right answers for these questions. Photographers aren't the best source of tax and legal advice because it's frequently not applicable to the person asking the question.

Business Licenses are required of any business in my jurisdiction, in my case, the County of Los Angeles.

There is no corporation that uses your personal social security number. There is an entity called a Sole Proprietorship. You file a tax form called a Profit and Loss from Business with your personal tax return. The other common name for that form is called a "Schedule C".

There are other kinds of entities but the one that is right for you is best decided with the help of an accountant because everyone's personal tax situations are different.

BTW - I am an accountant.

Yup, Sole Proprietorship, I was thinking of a P-Trust last night. too tired :P my ssn/tin and filed w/ my personal taxes. I bought a house this year, so I'll probably be going to an accountant in any case. Using Quick Books for now to track in/outs (especially as I'm just getting started, business wise).

thanks for the correction!

entropysedge

Even tho' you sell your images via SmugMug, you should look into getting a sales certificate of authority for the state where you live (in other words, authorization from the state saying you can collect sales tax) . I had gotten mine originally so that I could show in local art shows and street fairs however it does prove to the bank that you are indeed a business, after all, the state says you are.

If you go to an accountant, they will most likely tell you you will need to get this certificate of authority.

patsy easley

You should really check into your state sales tax laws. Texas (I will be moving there soon) requires that I submit state sales tax on any online sales made to anyone living in Texas. They are also starting to investigate small mom and pop type businesses to make sure they are submitting everything they should be.

clemensphoto's

I think in any state you probably should get an Employer Identification Number, which is what my bank requested when I opened up a checking account for my business. It doesn't cost anything and you can apply right online: http://www.irs.gov/. Click on SS-4 on the left side of the site.

As for the tax certificate I would talk with an accountant, but in Iowa I had to get one (free of charge) and I only have to apply tax to things that I directly sell customers that processed in Iowa. Since I don't live in GA and all of the actual photo processing is done in GA I don't have to claim anything for the tax end. However, beware, if you have the items sent to you and you add a frame or anything tangible you will have to charge tax.

sweet caroline

Doesn't Smugmug collect sales tax already? All my print sales are handled through Smugmug, so I've never charged a sales tax. I file Schedule C with my taxes, but don't have a business license. I haven't found good info on requirements online, and photography makes up a very small portion of our income, so I haven;t felt the need to consult an expert yet. I use a savings account for my business income.

Caroline

patsy easley

Smugmug only collects sales tax if the purchaser lives in California. Otherwise you have to check your state sales tax laws to see what your requirements are. When I get moved to Texas I will have to sell all of my prints as sales tax included and then figure how much of the total price, including shipping, would have been tax then submit that to the state. Every states tax laws on internet sales are different so check with your state.

edit to add: After I posted I noticed that you (Caroline) are from Texas. You don't have to have a business license but you do need to file for your state tax permit. The fine in Texas if they figure out you have made any taxable sales (session fees are also taxable in Texas) is $500 a day. Here is the link to get your tax permit.

Kalrog

in plain sight wrote:

Smugmug only collects sales tax if the purchaser lives in California. Otherwise you have to check your state sales tax laws to see what your requirements are. When I get moved to Texas I will have to sell all of my prints as sales tax included and then figure how much of the total price, including shipping, would have been tax then submit that to the state. Every states tax laws on internet sales are different so check with your state.

edit to add: After I posted I noticed that you (Caroline) are from Texas. You don't have to have a business license but you do need to file for your state tax permit. The fine in Texas if they figure out you have made any taxable sales (session fees are also taxable in Texas) is $500 a day. Here is the link to get your tax permit.

I believe where this breaks down is on thie page http://www.window.state.tx.us/taxinfo/sales/new_business.html

It says that you have to be in Texas (I am) AND selling tangible products (I'm not - SmugMug sells them). Although I would agree that the session fees would be taxable.

patsy easley

I may have misinterpreted the what I read about internet sales. I was confident in my answer earlier, but now I am questioning it. After rereading the information it looks as if because smugmug is collecting the payments we are not liable for Texas state taxes on portrait sales. However if you are doing any kind of self-fulfillment you are required to collect sales taxes.
Just one of the many reasons why when I get to Texas one of the first things I am going to do is find a good CPA.

Kalrog

in plain sight wrote:

Just one of the many reasons why when I get to Texas one of the first things I am going to do is find a good CPA.

Now that sounds like a good idea. I am planning on doing the same thing very shortly (I know a CPA or two - I just have to remember to ask her the question).

jdryan3

in plain sight wrote:

Just one of the many reasons why when I get to Texas one of the first things I am going to do is find a good CPA.

Try here for starters

patsy easley

jdryan3 wrote:

Try here for starters

Thanks!

Angelo

bump