OK.. sit down.. It is not that you don't need to report profits for 3 years. You have to report profits period if your running a business. If your doing this as a hobby then you can get away with not reporting profits because it is a hobby. The term hobby goes away if you making money after the first year. Are you selling retail or wholesale or both. Then you need to register with your franchise tax board to get a resale Lic. It is free in California as long as you tell them you expect to make a small amount off money. If however you go in there and thinking your going to make 50,000 the first year well then they just might ask for a front end deposit because they do not trust you collecting there taxes. If you w wholesaler, like I am 90% then you do not have to worry about collecting taxes but you need to make sure the people you are selling to give you their resale certificate number. Still with me.. You do need to register with your county for a factious name so that you can do business with a bank and most credit card companies.You need to deposit that 50 grand some where and a bank will not let you Cash a check that someone sent you with a business name on it.. You should turn your profits into the business but go get a beer ever so often. My first big job bought me a new press. You should keep an itemized account of every penny you use out of your pocket . Those are business expenses and tax deductible. If you go to office depot and buy pencils. That is an office expense. Did you drive anywhere to discuss business. That is an mileage expense. Do you have a web site.. expense. Do you have a host expense. Do you use your computer to do designs.. expense.. and by the way if you bought your computer 2 years ago and are now using it for business the day you started using it it became an expense.. Do you know excel. make a spread sheet. Feel free to email me and ask. been down this road so many time my tires are bald as well as my head.Lou