Question by senorhein: What legal processes do I have to go through to start my online business?
I am starting my own online business. It is small, it will be run out of my house (in Los Angeles, CA), I will be the only person involved and I will be selling art pieces that I create myself. I have researched many websites including the tax franchise board, the IRS, the Small Business Association, but I find them all so overwhelming and confusing. Do I have to charge sales tax? Do I need a Federal Tax ID? Do I need a State Tax ID? Do I need a California Seller’s Permit? I can’t seem to find a place that narrows down the start-up requirements. Thanks!
Answer by girlwhoknowsitstrue
You need to charge sales tax to anyone you sell to in CA, so that means tthat you need a state sales tax and seller’s permit.
You do not need a federal TAX ID or a state tax id – you can use your social security number and just complete the appropriate schedules.
You should go and register your business as a DBA (doing business as) at the county clerk’s office. You give them money, a name, you can be your name DBA yournameart.
If you sell to a dealer > $ 600 / year, you need to send them a 1099 showing gross money paid to them – you do not need to do this for any customer.
you can just sell on ebay, not file anything with anybody and not even call it a business – it’s technically tax fraud, but there are thoussands of ebay businesses that do it all the time – the best bet, though, is to not sell to anyone in CA.
Add your own answer in the comments!