Heart thumping I stare at the screen. With sweaty palms my finger hovers over the mouse; I take a deep breath, click….
No I’m not signing up for online dating, and I haven’t bought something breathtakingly expensive, on Etsy. I merely submitted my application for a federal EIN number. What’s that you ask? Good question…in fact there are a lot of good questions about setting up as a business…and it can be weirdly hard to get answers.
After floundering around for a while, getting cold feet, panic attacks, etc, I finally found this wonderful “business forms for idiots” wizard thing on www.virginia.gov It’s called Business One Stop: https://apps.cao.virginia.gov/IDC/index.html and it walks you through all the forms you need to set up a business in Virginia, including federal, state, and local (county) forms. In about 2 hours I was able to file as a sole proprietor, register a trade name, and set up a retail sales tax account, as well get the information I needed for Arlington County. I found my NAICS code (NAICS – North American Industry Classification System, http://www.census.gov/eos/www/naics/), and I got a FEIN (Federal Employer identification Number), not because I have employees, but because it is good to have for business bank accounts, and it keeps your social security number off of business forms. I registered with www.tax.virgiia.gov for the privilege of paying over retail sales tax to VA – they’ll get $0.31 this month – and you can sign up for e-mail reminders.
On a bookkeeping note, VA requires sales tax to be filed monthly, even zero balances, so a good system is to have a set of folders, one per month, and place a copy of any VA sakes in the appropriate month. Then, when it’s time to file, you just grab the right folder, add it up, and you’re done. We used this system at my last job, and I’m using it now – simple and effective.
registering a trade name was fun for me – (it’s also known as a fictitious name, or DBA, Doing Business As) I like my Etsy shop name very much, so now I’m officially BronzeAgeJewelry. I actually finished my filing today in Arlington. I have to say, Arlington County makes opening a business here sound very difficult, and very expensive, but it cost $10, and took 1/2 an hour. You do need to visit the commissioner of Revenue’s office, but they are very helpful. Before you go, get all the other paperwork done, and get your zoning permit (http://www.arlingtonva.us/departments/cphd/planning/zoning/cphdplanningzoningoffice.aspx). Armed with all this, march in, fill out the trade name application, business license application, pay Treasurer $10.00, and march out in business.
I was very worried about fees and taxes, but here it is: since I estimated to make less than $10,000 this year, my license was free, and I don’t own tangible property tax till next year. So, when I figure out how that works I’ll write more…..