Starting my business in Oregon.... questions

[Patch]

Again, I want to know if I'm supposed to register Assumed Name, Sole Proprietorship, or LLC, if all I'm doing is making a name for my business and working on building a separate account at the bank, and working up what it is I'm going to sell. Also, while looking at the online Oregon filing web-page, I see I can apply for an EIN. Do I want one of these if I'm not off the ground yet?

How to go about this slowly and steadily, or how to jump in suddenly without losing my shirt. I just want to see if it will fly, and if so, how I can do it legally. And I don't want my business name to get stolen while I'm figuring all this out.

Anybody know these things? Should I just sign up for a small business class somewhere around here instead? Or is it possible to just plain start from scratch all by yourself?

[Guest Smile&nod]

Try contacting your local bureaucrats for the paperwork side of things. Hopefully they can point you in the right direction.

If there are specific laws to your state, it may save you a bit of hassle.

I did a google for oregon business development and found those links as well as some others for financing options (if you are so inclined), but I can't vouch for any content. Good luck.

http://www.bizcenter.org/

http://www.filinginoregon.com/business/starting_a_business.htm

[ffq-lar]

Patch--

Mr. Toady has sent you in the right direction. Here in Washington I registered my business on-line. Took 8 days to receive all the info including a tax ID number. You have no sales tax in Oregon, but you should get all documentation you need. If you don't do any business the first year, whatever tax info you will need to file can be sent in as "no activity" for the year.

It sounds like you only want to register to save your business name. Funny thing, there are several "Finely Finished Quilts" businesses in Wash. and Oregon. My state doesn't care because they track everything by ID numbers, not by business name. If you want a domain name saved, that can be done as soon as possible.

Seems like you are looking ahead--you go!! After all is said and done, you will find that the first legal step to set up your business was actually the easiest!!!! Don't mean to scare you--the set-up is very easy. Some of the rest is way harder--but still fun and an adventure!!

[quiltmonkey]

Patty, I strongly urge you not to do this on your own without professional guidance. Please use the resources available to you at your local Small Business Development Center, or SCORE office. They have free or low cost resources, classes, information, etc. to help you the right way. Read all you can on the Internet. Use the Google search engine to find information. The IRS.org web page has EXCELLENT information on small business, including on line video tutorials. Get a couple of books from the library. Use the resources that are available to you and your best resource is your local SBDC or SCORE office. They know all the laws and requirements for your state and best of all, they want to help you succeed. They can help to answer all of your questions you have posted here.

[pigletaz]

Through my local bank I was able to register my company name for $10. They had the form and even sent it in for me as I opened my business checking account there. I'm in AZ, so I had to get a federal tax id number, very easy online go to the irs.gov. Since Oregon doesn't have sales tax, you probably shouldn't need a sale tax license (to collect and pay it) obviously, but I don't know if you need something else in its place.

Do you have state income tax? Need to answer that question. Also, if you haven't registered your domain name online - I used Go Daddy, but there are many places to buy and retain it. Even it you arent' ready to build a website, register the www name you want, so you can hold it while you gather info to build it.

My town requires a business license. As above, check the local bureaucrat websites, they are very helpful. In my area, the sales tax and business license was one form at one website combined, very easy. And affordable.

[Patch]

Thanks for all the information, folks! This is really helpful. I did contact bizcenter, who called me back the same day (yesterday) with information about a free start-up class. I will be getting back to them for more details. I think they do an interview with me to help me out with questions etc... That will be great.

I began to fill out the form for registering my business name, but the very first question stumped me: what kind of business is it? I mean what category? They don't have quilts anything in the list, or other crafty things or sewing of any kind. They seam to list only manufacturing different kinds of fabrics, not making things OUT of the fabrics. Very confusing to this newbie. It will be great to talk to someone who knows these things.

I'll let you know what eventually comes of all this. Thanks again!

[PattyJo]

Hi Patty - well, this is what I had to do being from good ol' Oregon. First I went to the Sec. of State, Corporation Division office here in Salem, (you can do this online) to register my business name. They will not allow 2 separate businesses in the state to have the same name, so if you want a specific name, you can do a name search at their "www.filinginoregon.com" site and if it is not being used, you had better get it registered and that costs $50. That is good for 2 years (and if you let it laps, then someone else can pick it up and use it). Secondly, at that time they give you a "Registry number" that you use as your wholesale number. When you file your taxes, your number is your ssa#. Then when you go to the bank to open an account, you must have an Oregon State Registry Number to get a business account. You can do this pretty quickly if you want to drive the 30 miles or so down to Salem and they should be able to give you your Registry Number while you are there in the office. If you do it online, it would take more time. Anyway just some suggestions, and if you do come down, be sure and call and we can meet for a cup of coffee (I really do have alterior motives!! LOL). Hope that this might help. Also as Shana said, you can contact the SCORE group or the Small Business Admin. for help, but having started 2 small business, this is what we did both times. If you have an accountant, you can also contact them to determine all the ins & outs of each type of designation for a sole proprioter, partnership, LLC or corporation and which would fit you best for tax purposes. I went with sole proprioter but I have my DH on checking account with me. All this is just food for thought.

And re: what catagory your business is, I do believe that they would consider it manufacturing. This is because we are taking a top (provided) adding our thread, possibly batting and possibly backing to it and "manufacturing" a quilt. Seem weird but that is what the gal at the Sec. of State's office told me.

[Patch]

Pat, thanks so much for all this relevant advice. This is exactly what I was looking for. I wonder if it make any difference that I would also be making the tops etc.... Probably not. I will certainly find a time to come down and have coffee with you. In fact, I'm thinking of making a trip to Corvallis to see Linda sometime soon too, and maybe take a class from her there, if she's still doing them. Have you done that?

Thanks again!

[PattyJo]

I went down to Linda A's for my introductory class after I got my machine. It was a great day that I met Beth there along with some other ladies that if they are on the chat here, I don't know their screen names. It was a great day and afterwards, DH & I drove over to Philomath to the quilt shop there. Actually, I dropped DH off at a car cruse in and I went to the quilt shop and it is a neat one.

Just give me a call when you can come down. You have my phone #. Maybe we can connect with Linda and drive on down and meet her for a cup as well! And if she is giving any classes, we can take advantage of that too.

[quilterkp]

I don't have my own business yet, but here is one thing I do remember from a business law class that I took. If you have a sole proprietorship, you can be sued and lose your personal assets. If you are an LLC, only your business can be sued. Just something to consider. :-)

[ffq-lar]

Another thing to consider--WHO WILL SUE YOU????

It may be shortsighted or wishful thinking, but how much damage could you do to a quilt, or how much damage could a customer do to themselves on your property that you would be in danger of losing your "assets"??

I know, granny falls and breaks a hip on your porch. If you are concerned about liability for a customer's injuries, take out extra insurance or meet then at the LQS only.

I can't imagine a level of damage that would cause a person to lose their house or other assets.

If you damage a top, usually even in small claims court the plaintiff will recoup the cost of materials and reasonable compensation for her time done piecing. If you can't cover those costs out-of-pocket, get extra insurance.

An LLC pretty much demands a CPA to do your taxes. Take that money and sock it in the bank to gain interest until that awful day when you might, maybe, perhaps, but probably not ---be sued.

Sorry for the rant--it galls me that "professionals"(insurance or accounting) insist we must have this or that when a small business looked at logically might not need these extras. And most of us have small, teeny, tiny businesses--that we dearly love. Not a lot of longarmers make a living solely doing this. Those people who do may need an LLC or a Corporation, but not little, bitty business women like most of us.

Whew!!! Thanks for listening--I had gotten with a local accountant when setting up my business and she steered me in lots of wild directions before my DH reeled me in with logic--as usual. I love him dearly!!

[yeoldeforest]

Hey I'm an accountant...CPA actually and I agree with Linda R!

One of the advantages of going into business as a sole proprietor is that you are not double taxed and the bookkeeping for a long arm business is relatively straight forward.

Plus if you are starting small, this is the easiest business to setup. You can use your SSN and you don't need a "doing business as" name unless you just want one. I did apply for an EIN number over the phone. It wasn't that painful and all the information is at www.irs.org

I have thought too about the chances of getting sued...not likely and if so, again like Linda said, the damages or risk of getting sued is offset by the ease of setting up a sole proprietorship.

Because I took out a loan to finance the Millennium, the lender made sure I had additional insurance for the business.

You can add a waiver statement or something that you have customers sign when you give them an estimate that you are ..."not responsible for...."

In fact, if anyone has a good liability statement, please do share!!

quilterkp - I sent you a U2U

Oh...it takes forever but the Small Business Administration does give out loans to those that are starting their own businesses. The rate is around 10% and it takes two to three months to process the loan. In order to qualify, you may need to talk to someone in SCORE or SBA. The long arm quilting industry seems very solid and I used APQS business plan with a few changes to apply for an SBA loan. It's kind of like applying for a mortgage:P

[quiltmonkey]

I think there is this perpetual stigma (myth) that if you are a sole proprietor, that pretty much means you are hanging a big old sign outside your business that says "HELLO. I AM A SOLE PROPRIETOR, SO SUE ME, PLEASE!"

Anyway, that was supposed to be a joke. Yes, there are lots of false rumors, and misinformation about being a sole proprietor. I agree with the above: Sure, there are risks with any business... if you are in a business that has a high potential for you to be sued, then by all means, you should cover your bases and protect your business appropriately, but for my situation, I am just "little old me" providing quilting services on a longarm. I have a full time salary job outside the home and quilting is on the side. I can't imagine getting sued by a quilt customer and that customer going to court and taking everything I own. Really, now...consider everything and use common sense. I am currently a sole proprietor, as are many businesses. The last thing I am worried about with my quilting business is someone suing me. I also have a CPA providing me professional advice on my business and she is also handling my taxes. This is her professional advice. She told me that in a few years if my business gets bigger, I might consider filing as an S Corporation. I pay her to give me advice, so I'm taking it. (besides, she's a quilter, too, so she can't be wrong!)