Hunter Forstchen and Cary Heise came together February 11th and addressed some common concerns and questions when starting a new business. Hunter took the “legit biz” side of things as she has recently gone through the process with her now “official biz” Katiebug Bows, LLC. Cary Heise addressed social media tips from her experiences with her three online businesses. Cary’s notes coming in a following blog post.
Hunter’s notes begins with a (slightly humorous) disclaimer…
***I am not an expert. All of this is based on my own experience so I encourage you to do your own research to determine what you will need for your business. This list may not include everything that your business needs.***
Turning your hobby into a legitimate business can be a daunting task. For me, I didn’t know where to begin and just thinking about it made my head spin! That fear and uncertainty kept me from taking the leap for three years! Hopefully, you will find what you need to get going today. Let’s get started.
Unfortunately, there isn’t a ‘one-stop-shop’ for setting up a business. In many cases you will have to deal with paperwork at the city, county, state, and federal level.
First, make sure you research the name of your business. You have to know that no one else is using your name. If that name is already taken you’ll have to find something new.
I searched three name databases to make sure I was covered:
Wake County with the Register of Deeds (find link that says Business Name Search)
United States Patent and Trademark Office (click on Trademark Search)
Once I determined that my business name was available I filed for my DBA (Doing Business As) with Wake County. I printed the form from the link above. It was a form that had to be notarized and mailed in with a check for $26.
If you know that you want to be an LLC or Corporation you will have to file Articles of Organization with the NC Secretary of State’s office. I became an LLC so I printed the proper form from the website above and mailed it in with a check for $125. No notary was required. Because I’m a sole proprietor, I found the form to be pretty straightforward. If you have business partners or will have employees you may want to consult an attorney first.
If your business will be ANYTHING other than a plain sole proprietorship (LLC, S-Corp, C-Corp, etc) OR you will have one or more employees, you must register with the IRS for an EIN number. This is like a SSN, but for your business. You can register for this online with the IRS. Then search for ‘register EIN’. This can be done in just a couple of minutes online and it is free of charge.
If you will be selling products as part of your business you will also need a NC Sales and Use tax number. This is the number you’ll use to pay the sales tax that you collect. You can register for this online with the NC Department of Revenue. It is also quick and free.
North Carolina doesn’t have a statewide business license requirement but the town that you live in may. Check with your town office to see what they require. I also recommend checking with your insurance agent that handles your homeowners or renters insurance to see if your materials and inventory will be covered under your existing policy or if you need supplemental insurance. I recommend Go Clark Insurance. They are a small local firm that has provided me with excellent service for many years.
I also recommend finding a bookkeeping specialist to help handle your bookkeeping for you or to just go over everything with you, including the sales tax forms that you have to fill out. This will be money well spent! I recommend Lori Aveni, owner of My Shoebox Bookkeeper.
Another consideration is to register for a Trademark with the US Patent Office to protect your intellectual property.
Check back with notes from Cary’s part of the presentation!