Just became official

[JohnT]

I now have a DBA and a bank account, but I still need to get a sales tax number. Once I do this, what should I expect (letter from the state, forms to complete every so often, etc...)?

[CobyPhoto]

Yes, once you get the tax exemption number, you will be required to complete necessary forms either Monthly, Quarterly or Annually depending upon the amount os sales you have. You MUST complete the return and file with the Comptrollers office EVEN if you have no sales and tax due for the period you are filing!

CJ

[JohnT]

Thanks, CJ! I think I can handle that.

[d2creative]

Originally Posted by CobyPhoto

Yes, once you get the tax exemption number, you will be required to complete necessary forms either Monthly, Quarterly or Annually depending upon the amount os sales you have. You MUST complete the return and file with the Comptrollers office EVEN if you have no sales and tax due for the period you are filing!

CJ

What are the limits for filing quaterly vs annually?

[CobyPhoto]

Not sure about Annual vs. Quarterly. I have always filed mine monthly and I know the threshold there is 2,500.00 for any Quarter, you have to file monthly, with the only exception being seasonal. It is actually based on gross taxable sales I believe, so about 35K in sales for a quarter and you have to pay it monthly from then on.

CJ

[HotHolly]

By the way - unless your tax office is better than mine - KEEP GOOD RECORDS. They lost 2 out of 4 statements this past year. I had copies and proof they were sent on time, otherwise it would have cost me. But it did take the time to call up and correct it. Kind of annoying, but part of the biz.

Part of how often you pay taxes has to do with what you tell them. You may be better off guesstimating business low rather than high. They use what you tell them plus stats to see where you fall.

CONGRATS ON GOING LEGAL!

[CobyPhoto]

Originally Posted by HotHolly

Part of how often you pay taxes has to do with what you tell them. You may be better off guesstimating business low rather than high. They use what you tell them plus stats to see where you fall.

Not exactly true. For the first payments it may hold true, but if any payment is over the threshold, they will require you to then pay on the next most frequent schedule from that point forward. Just be honest and give them a estimate that you feel will reflect the amount of business you do. It is actually easier to pay Quarterly or Monthly as opposed to Annually. Easier to track and keep up with. (Especially if you do any 501(c)3 Not for profit, City Government, School work that is exempt.)

Keeping good records, copies and proof of payment is ALWAYS a good thing to do. You can, by the way, pay your taxes on-line and get instant proof that they have been paid. Here is a link:

State Tax Web File

CJ

[HotHolly]

Originally Posted by CobyPhoto

Not exactly true. For the first payments it may hold true, but if any payment is over the threshold, they will require you to then pay on the next most frequent schedule from that point forward.

Thanks for clarifying...I didn't mean fudge your numbers, but rather to be sparingly realistic. As nice as it would be, most photogs don't make $150K their 1st year open.

That's all. Thanks for clarifying! My mind is all over the place, my toddler went the emergency room with Mike. I'm on here with my daughter trying to act like everything is fine. (I'm not so good at that part).

So, I'm typing - apparently incomplete thoughts...Ugh.

[stargal01]

johnt, i'm about to be in the same boat as you, so thanks for asking this question.

[René]

Congratulations John! Very exciting!!!!

Since Dianna is about to do the same thing I thought I would ask (hope it helps) how you opened your checking account without a taxpayer number? I opened up a new business account last month and had to provide it. Did you just use your SS #? We are trying to be strict with ourselves about keeping personal and business accounts and expenses separate this year, it’s tougher than I thought.

BTW, we pay quarterly taxes when we receive the notice/form from the state. Also, like Holly said, keep good records. In addition, if I spend a dollar on anything studio, I keep the receipt.

[kamari]

Originally Posted by 3CP

Congratulations John! Very exciting!!!!

Since Dianna is about to do the same thing I thought I would ask (hope it helps) how you opened your checking account without a taxpayer number? I opened up a new business account last month and had to provide it. Did you just use your SS #? We are trying to be strict with ourselves about keeping personal and business accounts and expenses separate this year, it’s tougher than I thought.

BTW, we pay quarterly taxes when we receive the notice/form from the state. Also, like Holly said, keep good records. In addition, if I spend a dollar on anything studio, I keep the receipt.

It's possible to open it with your SS#, but not exactly recommended.

[CobyPhoto]

Originally Posted by 3CP

Congratulations John! Very exciting!!!!

Since Dianna is about to do the same thing I thought I would ask (hope it helps) how you opened your checking account without a taxpayer number? I opened up a new business account last month and had to provide it. Did you just use your SS #? We are trying to be strict with ourselves about keeping personal and business accounts and expenses separate this year, it’s tougher than I thought.

BTW, we pay quarterly taxes when we receive the notice/form from the state. Also, like Holly said, keep good records. In addition, if I spend a dollar on anything studio, I keep the receipt.

Dianna,

It is usually a requirement that you have a state tax number, FEIN and legal name document to open an account. The point about SS# is kinda moot, if you are organized as a sole proprietorship or partnership and not some type of corporation - (seperate legal entity from owners) you can and will be held responsible for the debt and liability of the company in the end as either; (sole prorietor and partnership.) Not to say that you can't be held responsible as a corporation, there is just more seperation involved and more documentation, legal work etc. when setting one up. When dealing with a small business, most of the benefits offered by a corporation will be defeated due to the fact most banks and lenders will require you to sign as a personal guarantor on all debt for the corporation anyway.

There are many things to consider and you best option is to always consult a CPA and in the case of a Corporation, lawyer.

CJ

[JohnT]

Originally Posted by 3CP

Congratulations John! Very exciting!!!!

Since Dianna is about to do the same thing I thought I would ask (hope it helps) how you opened your checking account without a taxpayer number? I opened up a new business account last month and had to provide it. Did you just use your SS #?

Thanks, René! Yes, SS#. My bank told me that since I'm a SP, that would suffice.

[JohnT]

Thanks, everyone, for the great info so far. I don't necessarily like the business side of anything, but I do want to make sure to keep everything right and legal--especially my bookkeeping and taxes.

[hhscr]

Don't get the sales and use tax number confused with a Federal Id Number. They are two diffrent purposes. One is for the paying of sales taxes to the state and the other is for banking and paying taxes to the feds.

For a SP you can use your SS# for your banking. If you go the way of inc or llc it is best to get a federal id number and keey your SS# out of it.