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Do I need a Permit/License if I'm only going to be selling online?

8316 Views 11 Replies 10 Participants Last post by  dmfelder, 
I
I'm trying to get my online business setup LEGALLY in Sacramento, CA. People in this forum told me I need a permit/ license. On the application forms it said where your shop is. I don't have a shop. I'm trying to start a clothing line without a physical shop. Can I just do it under the radar? If I get fined how much will it cost? Any other thing I should know about?

Thanks!​
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Jsapata
Nicholas.

In EG (part of Sac County) the cost is only $110 for 2 years on the biz license and $27 for a DBA/FBN. If you file a DBA/FBN you will also need to run an ad in an approved news paper for 4 consecutive weeks. The cheapest one I found was $35 for all 4 ads.

There are a few other forms you need to file but they are free from what I recall.

Check out www.Calgold.ca.gov
You can enter your county and biz type and they will give you the contact info for all of the offices you may (not all are required) need to contact to setup your new biz.

I have a spreadsheet and word doc I saved with all of the info I might be able to find and send you if needed.
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I
Could you send it to my email directly? [email protected]

Thanks a lot!
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bornover
Nicholas, for all the forms you fill out, your place of business is your home address if you are a home based business. Even if you conduct business strictly online, you still provide your home address as your place of business.

You will collect sales tax for any sales you ship to California, you will not collect sales tax for orders shipped out of state. You will have to have accounting software to keep track and send in your sales tax collected to the Board of Equalization when your tax period is due. You may get monthly, quarterly or yearly tax periods based on your answers on your seller's permit application.
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binki
ItsNnicholas said:
Can I just do it under the radar?
Click to expand...
You can do it as a hobby without any registration to start out with. When you start making bank you can then start with all the registration.
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kimura-mma
ItsNnicholas said:
Can I just do it under the radar?
Click to expand...
binki said:
You can do it as a hobby without any registration to start out with. When you start making bank you can then start with all the registration.
Click to expand...
You can report income as a hobby, but you still have to collect and report sales tax from online orders that ship within your own state. So in that sense, you can't really fly under the radar (legally, anyway).

ItsNnicholas said:
If I get fined how much will it cost?
Click to expand...
I don't know how much the fines are. But it makes sense that they would be more expensive than just getting the registrations, permits and licenses up front.
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OriginalShortees
Nicholas, the advice everyone is giving you is very good. My business is based in California and I have had to navigate all of these issues. It takes a tiny bit of time but its really not that hard. Its actually one of the easiest things you will do as far as running your business.

You will need a business license for your city and resale license. Depending on the format your company takes there are some other pieces of paperwork. If you are a corporation there will be a few hoops to jump through. A sole proprietorship is quick and easy to set up. You will file the paperwork for it and have to
Follow Jsapata's link and also look at the CA Secretary of State's web site for more info.

What I wrote is not a complete list but if you follow the web link and the Sec of State site you will find all of the info you need.

Don't be intimidated by this. Its not hard and well worth the effort. You will never regret giving your own business a shot and even if you don't become rich, what you learn about starting a business will be invaluable.

Its in your best interest to just do things correctly and be safe. You never win trying to get around the government. Give them their nickel, fill out the paperwork and have no regrets.
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A
Does anybody have any advice as far as working out of Illinois? I'm kind of in the same spot. In fact we have the same exact issue as far not having a business or office address. I'm not really sure if I need to put my home address if I'm strictly online.
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G
kimura-mma said:
You can report income as a hobby, but you still have to collect and report sales tax from online orders that ship within your own state. So in that sense, you can't really fly under the radar (legally, anyway).


I don't know how much the fines are. But it makes sense that they would be more expensive than just getting the registrations, permits and licenses up front.
Click to expand...
I'm in a similar boat. I had considered starting it "as a hobby". Though with my setup I figured I might only do a few hundred dollars business in 2010, so I felt a bit more safe doing it that way... Then incorporating in 2011.


As for the OP, if you decide to start the business, make sure to read upon your options. I made the post http://www.t-shirtforums.com/business-finance/t127653.html about different business types. I know that LLCs are quite pricey in CA...
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D
I have been searching pretty much all day in finding out what license(s) I need to start an online store only business. I am in the exact same situation as the op. I am from La, CA and I don't have a store name, extra employees, or a business address. I only have an online webstore that I plan to sell to nationwide. International too if it reach out that far :D

What I have found out for my situation is that I need the following:
business license
DBA
Sales State tax id (reseller permit i think is called)
Federal employer tax id EIN

Just to test the water, can I go by with just the reseller permit and when sales pick up, I will get the other licenses? Will I be ok as far as filing the monthly, quarterly sales taxes and not to mention with my personal tax at the end of the year with just the reseller permit?

I have started filling out the reseller permit but am stuck with some questions. The form is asking for the following in which I have no idea.

Name of sole owner, corporation, LLC, Partnership, or trust.
State of incorporation or organization.
Business trade name/doing business as (DBA).
Corporate, LLC, LLP, or LP number from California Secretary of State.
Federal Employer Identification Number FEIN.
Click to expand...
Can someone shed some light? Thanks.
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binki
Look here:
http://www.t-shirtforums.com/t-shirt-articles/t17054.html
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D
Here's the best advice: consult an attorney. Laws vary by state, and internet law in particular changes constantly.

Some states require a business licence if you have bricks & mortar, others require it regardless. My belief is that in ALL states, you'll need a tax ID/account because you'll be required to collect & report sales tax for purchases in CA.

Best wishes.
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