Standard Rules of Licensing

It is exciting to receive my business license in the mail. As an independent contractor writing, drawing, blogging and vlogging to collect commissions or royalties it is my responsibility to report taxable earnings. There are a lot of people that think business licenses are for charging sales taxes, yet this is untrue. Any Sole Proprietor of a business must have a business license.

How does the license system in the United States work? There are a few rules for contacting the correct government office.

Departments vary from state-to-state. In Texas the Comptroller handles most business issue; such as, securing a business name and declaring taxes. In Utah there are several departments. The Department of Commerce issues unique business names. The Department of Planning and Development issues business licenses. The State Tax Commission or Internal Revenue Service issues Sales Tax Licenses. The Worker Compensation Fund issues Employee Identification Numbers for paying FICA and taxes on employee paychecks.

These are all mutable titles that differ from county-to-county. Contact the appropriate business licensing bureau in conjunction to the business location for more information. Search "business license gov" to begin finding information. Make sure the web address ends in ".gov."

Usually information at the Small Business Bureau Administration is too vague. It is easier to simply look up the county or state business licensing division in the blue pages of a phone book.

The Department of Commerce assists in validating a person business, yet a person does not have to register with them. In a Sole Proprietorship a person's name, social security number or foreign identification number is enough to gain a business license.

The Department of Planning and Development issues business licenses. They also provide zoning permits. Everything is relative to the type of business. A person who is only working on a commission basis, not as an employee needs a business license even when the company they work charges taxes for direct sales of products.

Any business larger than a Sole Proprietorship or Sole Proprietorship wanting a unique name need to register with the Department of Commerce. Visit the Department of Planning and Development to find out regulation on owning a home business or buying land for a business because there are several rules and restrictions.

A home business must fulfill fire safety guidelines. Home businesses are also able to keep anything on site that is found in an average household. This includes clothes, computers, art supplies and so-on. This does not include toxic chemicals or industrial equipment.

Home businesses are not allowed to keep inventory on premises or use their home as a display room or gallery. Homes are also not allowed have clients meeting in their home. Some regulations clarify boxes should not block entry ways. Door-to-door salesmen are able to take small display cases to another person's home. They order products for delivery and are not allowed to use their own home for demonstrate or sell products.

Zoning between residential and business locations maintains acceptable practice in a given area. There are also restrictions on what type of business is allowable in certain areas. Industrial manufacturing and farming are obvious to most people, yet not-for-profit stores and restaurants should check property zoning before buying it, because it wastes time having to resell land to buy land that complies with county regulations.

State and federal taxes are important when directly selling products. Some products and services are non-taxable, yet most products and services are taxable. Most states do not charge taxes for online products, yet products are still taxable according to the point-of-sale. Taxes apply. The internet is only a marketing tool.

A person does not have to declare taxes on all sales. Garage sales or selling personal property is non-taxable. You do not have to file for a business license to sell your old shoes or hoody, though it is nice to give people a receipt. Declaring sales tax is important when consistently making money from the sale or resale of products and services. These include assembling products in a home or painting cars in a garage; however, if receiving earning or paycheck from a store for assembly the store charges sales tax. If the Assembler is not an employee, they need a business license to declare earnings.

Employee Identification Numbers are clarify a difference between contract employment or regular employment. Contract employment is between a company and person who is working on a case-by-case bias. Most blogging and vlogging jobs are contract. Bloggers and Vloggers write articles or create videos to create attention for Advertisers. It is paid by performance of views and referrals to companies who will charge sales tax accordingly.

Game Testers are also contractors. They test games and write critical feedback for Video Game Developers and then send them a check. The obvious way to tell if you are contract or employee is if FICA and taxes are deducted from paychecks.

Extras frequently are employees for major film companies. They might work for several reduction companies and only work one day a month, yet deductions are made after filling out W-4 forms. Most film companies prefer W-4 forms; instead of, I-9 forms or contracts because it makes sense to hire a payroll company to ensure all taxes are paid. Employee Identification Numbers are complicated for smaller film companies ergo an Extra or Actor receives a check without deductions. It is only important to gain a business license if acting more than a handful of times throughout a year, yet declaring earnings assists in developing credibility as an Actor or Actress.

It is important to know how to hire employees. Frequently performance based paycheck are more suitable to smaller business and Salespeople, because it guarantees they will not pay more than what they are earning. Larger companies want to save money through hiring people with standard paychecks to streamline payroll costs. There is also the between levels of employment; wherein, a paycheck is necessary otherwise people will not work for them.

When having to go-to-work at specific times or specific locations a paycheck is important. Car Salesmen often work for minimum wage and commission. They earn a standard paycheck for going to the showroom for specific hours when they could be doing something else. There are also restrictions on behavior and dress code. Though a combination of contract and employee pay it is easier to pay wages and commission with an Employee Identification Number.

Sometimes it is easy to start a business and forget the basics. Proper licensing assists in declaring taxes validates a business's performance and avoiding future conflict with the Internal Revenue Service.

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