SCORE MID-COLUMBIA CHAPTER 590
THE SCORE ASSOCIATION (SERVICE CORPS OF RETIRED EXECUTIVES) IS A RESOURCE PARTNER WITH THE U.S. SMALL BUSINESS ADMINISTRATION. SCORE IS DEDICATED TO AIDING IN THE FORMATION, GROWTH, AND SUCCESS OF SMALL BUSINESS NATIONWIDE.
|
LINKS About SCORE
|
Federal Registration
Every employer subject to employment taxes is required to have a Federal Employer Identification Number [EIN). Before you -request an EIN you will want to receive your "State Registration Certificate" and Form SS-4. Form SS-4 is the official application for the Employer's Identification Number [EIN]. In WA contact: IRS: 1-800-829-1040 Articles of Incorporation are filed with the Secretary of State in Olympia. You can find information by going to the State of Washington home page -- www.wa.gov If you haven't checked out this homepage you should for some great information. www.wa.gov/sec will get you directly into the Secretary of State's page. Go to services and then corporations. Filing fee is $175 for original application -- fee schedule is also included. Address is : Corporations Division 505 E Union, 2nd floor PO Box 40234 Olympia, WA 98504-0234 (360) 753-7115 Sole Proprietor with No Employees -- Request form 1040 Schedule C, and publications 334 and 583. Sole Proprietor WITH Employees -- Request form 1040 schedule C, Form SS-4, and publications 1635, 334, and 583. Sole Proprietor with OFFICE in home -- In addition to the above forms, if you will have an office in your home you should also order form 8829 and publication 587 (explains certain tax deductions and eligibility guidelines). A limited liability company (LLC) is a hybrid entity that combines the tax flow-through aspects of a partnership with the liability protection of a corporation or a limited partnership. However, unlike limited partners in a limited partnership, who lose their limited liability status if they attempt to manage the business, a member of an LLC is not prohibited from managing the business. Corporations: One of the best-known and most widely used business entity forms is the corporation. Traditionally, corporations are viewed as having four identifying characteristics. The four corporate characteristics are: continuity of life, centralization of management, limited liability, and free transferability of interests. The main advantage of a corporation is the liability protection it provides its owners or shareholders. Liability is limited because the corporation is a
legal entity that separate from its shareholder owners. As a separate legal entity, the corporation has a perpetual life. Also, as a separate legal entity, the corporation is liable for its own debts and can only be held liable to the extent of the corporation's assets.
|
S Corporations: The difference between an S corporation and a regular corporation is that the S corporation has elected to be taxed similar to a partnership for federal tax purposes. After making the S election, the income, losses, tax credits, and other tax items of the corporation flow through the corporation to the shareholders. Thus, income is only taxed once, at the shareholder level. If a corporation does not make an S corporation election, corporate income is taxed twice;
once at the corporate level, and again at the shareholder level when the corporate income is received by the shareholder as a dividend.
Insurance (Estimates)... Liability -- A "must": $500,000 coverage for approx $250/year; $1,000,000 coverage for approx $300. Add loss of tools: $6,000 coverage for approx $50/year. Worker's Comp -- Covers employees injured on the job. Cost is typically $300-1,000 per year, depending on your total payroll. Bonding -- Typically $50 per year per individual. The Business Plan or "Road Map" Think of the Business Plan as a road map to your destination. Without it, you can become lost and never get to where you want to go. (80 percent of new businesses fail within five years; most do not have a written business plan.) The Business Plan (or "trip plan") should consist of: The Purpose of your business (The Mission) -- Should include a "mission statement" and what you hope to accomplish. The Product or Service (The Vehicle) -- Describe your products or services. Include a warranty/return policy. The Market for your product or service (The Customers) -- Who will buy, how you plan to reach them (advertising, etc.), who is your competition and how will you excel? The Operations (Facilities, equipment, vehicles required) -- Describe building design, equipment, production or service process, and cost of each. The Management/Staffing (People requirements) -- Describe your training and experience, and qualification of staff. The Finances (How you plan to pay for your business) -- Include a balance sheet (assets/liabilities), income statement (profit & loss) and cash flow projections (includes "break even point"). The Summary (Written last but inserted at beginning of plan) -- A one page summary of the total plan, often called the "executive summary". This gives a quick overview of your business plan. |
