Need to Register?

billm75 · January 24th, 2008

Rodney,

I've been there and done that previously. I'm not saying this as "I think this is how it works"...etc.

Either way, I'll just agree to disagree on the subject.

No sense in beating this poor horse any longer.

Rodney · January 24th, 2008

Quote:

Originally Posted by billm75


	Rodney, I've been there and done that previously. I'm not saying this as "I think this is how it works"...etc. Either way, I'll just agree to disagree on the subject. No sense in beating this poor horse any longer.

I have no doubt that you've done it before

I wasn't so much as trying to convince you to change your ways (as you said, it's probably best to agree to disagree), I was more trying to post for the benefit of the hundreds of other people that may read this thread and think that not registering is a good idea and may think that getting a seller's permit is something really hard to do.

I just want to assure people that it's not.

I also wanted to make sure people know there are big penalties for selling without a seller's permit.

Thao1mage · January 24th, 2008

I would have to say that Rodney is correct. Getting a permit is as easy as he says... you can do so much more and buy for some much cheaper with one that you might cheat yourself if you don't get one anyway...

billm75 · January 24th, 2008

Quote:

Originally Posted by Rodney


	I have no doubt that you've done it before I wasn't so much as trying to convince you to change your ways (as you said, it's probably best to agree to disagree), I was more trying to post for the benefit of the hundreds of other people that may read this thread and think that not registering is a good idea and may think that getting a seller's permit is something really hard to do. I just want to assure people that it's not. I also wanted to make sure people know there are big penalties for selling without a seller's permit.

OH!!! Well I didn't mean to advocate that you SHOULD do business illegally. I guess maybe I've missed your point till now. What I'm trying to do is put together a simple list of wholesalers that do not require sellers permits, etc, in order to purchase from them. I think I've seen about 10 threads in the last few months asking for such info.

This is the unfortunate downside of a computer based forum. People read things differently and therefore get different ideas of what someone else was saying or implying.

I'm not making money as of yet, I'm simply putting together samples, catalogs, etc. In fact, I haven't made back my investments whatsoever.

I have done a shirt for a friend, a few shirts for my family....etc.

I guess, and I'm hoping this isn't too redundant, I'm just trying to find suppliers where I can order in a dozen shirts, try things out, do a few samples for my own purposes and maybe land my first order before going through the process of licensing the biz. (I do know that legally, you are allowed to earn x amount of income before you have to claim it).

Thus far, that hasn't happened.

I'm looking to get things in line on MY end, the end I can control entirely, before I get involved in the business licensing side of things....I did that the other way around before and it was just too much of a hassle for ME.

Trapshooting · January 31st, 2008

I am new to this forum and have been reading posts for several weeks, just trying to learn more about the T-shirt business. This line will go along with my other products for " Glitz" which I will sell at expos, shows and events.
I am also just starting to "dabble" in this as a new possible business. I just sold a very lucrative business that became to big and I would have had to hire employees to keep it. Here in our state and I believe all states you can have a "hobby business". as long as you pay taxes on any actual profits at the end of the year, you are not required to be a registered business at all. This is exactly how many crafters run a business without any tax ID numbers etc.
Once you do find your business operating with a profit on a regular basis then of course it is a good idea to become a real business. Of course I am sure my age has much to do with my views as I am in my 60's and have no real desire to venture full time into anything unless I see a clear vision of becoming a brick and mortar Boutique. I do want to thank everyone for sharing their ideas and experiences, this is truly a wonderful and informative forum. My hopes are that my single input does not insult anyone as my intention is only to share my experience as well.

Rodney · February 1st, 2008

Quote:


	Here in our state and I believe all states you can have a "hobby business". as long as you pay taxes on any actual profits at the end of the year, you are not required to be a registered business at all.

You may want to double check to make sure that sales taxes are not also required to be paid.

I know in California, if you're making sales, you have to collect/report/and pay sales tax.

Trapshooting · February 1st, 2008

Sales tax is required on anything you sell. Here in Missouri, some counties require you to collect sales tax on garage sales! Collecting sales tax does not necessarily mean you are in business. If you do get permits and business tax ID numbers, please be aware you must file a business schedule with your taxes every year and if you lose money for three years you put up red flags that DO trigger an audit. The government looks at business much differently, Their philosophy is " Why would you stay in business if you are not making any money". I would not do anything illegal, but I certainly intend to not become a business without trying out the product/s and thoroughly researching what marketing will work. Getting an order for 100 shirts may be all you get the entire year, this would not be lucrative for any business. I intend to start as a " Hobby Business" and will indeed pay taxes on any profits. I will not become a retail business until it becomes profitable to do so.

twisted · February 6th, 2008

Not sure about all states but in Ohio you can make something like $600 before you have to file it on your taxes.

I Also ran into the end of the year tax problem once. I thought I was doing really good and set aside money for taxes at the end of the year and everything. I was painting cars, motorcycles, etc. which is a service so the tax situation was different. I was working my butt of and paying a lot of extra taxes due to having a full time job as well. It put me into a different tax bracket.

Rodney · February 7th, 2008

Quote:

Originally Posted by twisted


	Not sure about all states but in Ohio you can make something like $600 before you have to file it on your taxes. I Also ran into the end of the year tax problem once. I thought I was doing really good and set aside money for taxes at the end of the year and everything. I was painting cars, motorcycles, etc. which is a service so the tax situation was different. I was working my butt of and paying a lot of extra taxes due to having a full time job as well. It put me into a different tax bracket.

I think there's some confusion here.

There are different types of taxes being discussed.

The type that sometimes have a minimum is "Income Tax" (like from the IRS). Sometimes it's set at $600 before you have to claim it or something like that.

The type of tax I'm talking about that you CAN'T avoid is "Sales Tax". That is collecting tax from sales made in your state and paying tax back to the state that you collected.

There's no minimum "grace period" on "sales tax" that I know of.

Trapshooting · February 7th, 2008

I thought the original question was whether or not a liscense was required to try out a business on an experimental basis. Of course everyone must pay sales tax business or individual alike if they sell anything retail, that includes flea market vendors, crafters etc. However not eveyone must have a business liscense, again ex: flea market vendors, carfters yard sales etc.
I do hope that helps to clear any confusion I may have contributed to in this thread.

twisted · February 8th, 2008

Quote:

Originally Posted by Rodney


	I think there's some confusion here. There are different types of taxes being discussed. The type that sometimes have a minimum is "Income Tax" (like from the IRS). Sometimes it's set at $600 before you have to claim it or something like that. The type of tax I'm talking about that you CAN'T avoid is "Sales Tax". That is collecting tax from sales made in your state and paying tax back to the state that you collected. There's no minimum "grace period" on "sales tax" that I know of.

Sorry about that. I wasn't thinking about sales tax.
Last time I sold to someone out of state I was not required to charge sales tax. Only if you were in Ohio selling to someone in Ohio you had to charge the tax. May have changed but I still see a lot of places that say "residents of (insert state name here) add xx% for taxes.

greyhorsewoman · February 9th, 2008

Rodney had a lot of good points in his posts.

Just to clarify: the reason a lot of 'wholesalers' won't sell to you without you providing a sales tax ID is:

1) They aren't a retail outlet and don't want to compete with their retail customers by selling a handful of shirts here and there.

2) They are required to CHARGE you sales tax if you don't prove you are a retailer and will be collecting whatever sales tax is required on your finished product.

If you are in the 'planning stages' of your business, I'd say having to pay a little more for your 'sample' shirts is just the way it's going to be. Once you are an 'official business,' it will qualify you for better pricing.

And, in states where clothing isn't taxed, it's easy to fill out the form ... it asks for 'gross sales' then 'sales excluded from tax' -- you pay the difference. If you have little or no tax liability, some states will put you on a semi-annual or annual filing.

Girlzndollz · 2 Weeks Ago

I just wanted to add, as this seems to come up, Alpha Shirt will give case pricing when the order is phoned in. They can't do it for online orders as they adjust it manually. I've gotten orders out of Philly for $30 that I needed same day, and they've given case pricing on the items. Just have to ask for it over the phone. Good luck everyone! Happy t-shirting!

kpk703 · 2 Weeks Ago

The general rule (emphasize general) is that sales tax must be collected on all sales delivered within "your" state. There are exceptions. It doesn't matter how small the sale. Obviously if you live in a state that doesn't collect sales tax on clothing you are not required to collect it. In my state...maybe yours, maybe not...30 days after you've made a sale sales tax must be reported and paid. Failing to do so is a violation of state law. It doesn't matter if your a hobby business or not. Always, ALWAYS, check with the laws in your state. My brother was hit with a $5,000.00 fine and penalty for failing to pay sales tax on belt buckles he was engraving and selling at gun shows. He was nabbed at a local gun show...not a pleasant day for him. Couple state treasury workers came up to him and demanded he provide his retail sales tax id...he looked confused. They copied down his driver's license and he received a summons in the mail 3 days later. Better safe than sorry.

onesielady · 2 Weeks Ago

Legal is the way to ngo. All you need to do is register your company and make it official. You do not need to file taxes until you start earning a certain amount of money after your exenses - which can take some time. It may be worth talking to an accountant before making a decision about not registering your company. All you need to do is fill out some paperwork and you can register fro a sole proprietership or the like and you can do it by yourself. Really, not a big deal at all!