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SBA.GOV 10 STEPS TO STARTING A BIZ (EMPLOYER'S RESPONSIBILITY (step 2…
SBA.GOV
10 STEPS TO STARTING A BIZ
BIZ PLAN
BIZ ASSISTANCE & TRAINING
BIZ LOCATION
biz needs
plan for future growth-extra space
local labor market
proximity to suppliers
competition
safety: crime rate
brnad image
zoning regulations
financing
hidden costs
decoration
IT system upgrades
renovation
taxes
govt-eco incentives
minimum wages
FINANCING
bonding program (surety bonds)
venture capital program
Small Biz Investment Company (SBIC)
Guaranteed loan programs
CapLines
Seasonal working capital
line of credit
international trade
SBA Express-SBA Veterans Advantage
term loan
line of credit
export working capital program
non 7(a) micoloans
export express
term loan
line of credit
504 loans-CDC
community advantage
7(a)
biz checking act
introductory offers
interest rate for savings & checking
interest rate for LOC
transaction fees
early termination fee
minimum acct bal fees
biz insurance
Step 1: assess your risks
step 3: shop around
step 4: re-assess every year
step 2: find a licensed agent
LEGAL STRUCTURE
LLC
Regular LLCs
Series LLCs
sub LLCs are insulated from debts & liabilities of other sub-companies
regardless of how many sub-LLCs
only 1 registered agent fee
person who receives important tax & legal documents from SOS & other govt agencies on behalf of the biz (LegalZoom)
1 certificate of formation of filing and fee of $300
C/S Corporation
sole proprietorship
General Partnership
DBA required if
1.sole proprietorship-partnership
operate under name different from your real name
Corporations-LLCs
under name other than the corporation/LLC name
If no biz premises maintained
register for a DBA in all counties where biz is conducted under assumed name
FEDERAL, STATE, LOCAL TAXES
Federal taxes
self-employment tax: FICA Er or Er+Ee
income tax
FUTA: federal unemployment tax
FIT: federal income tax
Excise tax
manufacture or sell certain products
operate certain kinds of biz
use various kinds of equipment, facilities, products
receive payments for certain services
state & local tax
sales & use tax
SUTA: state unemployment tax
franchise tax
Property tax
EIN requried unless
sole proprietor using his/her SSN
LLCs: real estate holding. No employees
determine when tax year starts
calendar tax year
fiscal tax year
suits seasonal biz: retailers
short tax year (less than 12 months)
biz didn't exist for the entire year
chaning tax year
send request to IRS
LICENSES & PERMITS
federal
argiculture
alcoholic beverages
aviation
firearms, ammunitions, explosives
fish & wildlife
commerical fisheries
maritime transportation
mining & drilling
nuclear energy
transportation & logistics
state
professional licenses
surety bonds (required for certain licenses)
tax permits
sales tax license & resale certificate
income tax withholding
SUTA: state unemployment
home-based biz
home occupation permit
additional: ie childcare, food production
check on restrictions with Home Owner's Association (HOA)
EMPLOYER'S RESPONSIBILITY
Step 4: register with the state's new hire reporting program
report newly hired & rehired ee within 20 days of hire/rehire date
step 5: worker's comp insurance
Step 3: ee eligibility verification
I-9: keep on file for 3 years after date of hire or one-year after date of termination, whichever is later
use E-Verify
Step 6: post required notices
inform ee of their rights and employer's responsiblity
step 2: set up records for withholding taxes
FIT withholding
obtain signed W-4 before employment
submit W-4 to IRS
federal wage & tax statement
send copy A of W-2 to Social Security Administration (SSA) by the last day of Feb to report wages & taxes fo ee for the previous calendar year
state tax
Texas: no state income tax
SUTA
step7: file your taxes
941: employer's quarterly federal tax return
others
step 1: get IEN before hiring first ee
step 8: set up recordkeeping-stay informed
LOCAL ASSISTANCE
HubZone
SBDC
SCORE
Women's Biz Ownership (WBO)
EXIT STRATEGIES
https://www.sba.gov/business-guide/manage/close-sell-your-business-transfer-ownership
(1) close your biz
decide to close
file dissolution docs
cancel registrations, permits, licences, biz name
comply with employment & labor laws
Worker adjustmetn & retaining notification Act (WARN)
resolve financial obligations
income tax returns
sales tax returns
cancel EIN
notify federal & state tax agencies (checklist)
maintain records
ie: tax & employment records, etc (3-7 years)
(2) sell your biz
biz valuation
self-evaluation
professional biz appraiser
3 valuation methods
income approach
market approach
compare your biz to other similar biz that have recently sold
assets approach
make a sales agreement
transfer ownership
outright sale
sell biz in full, transfer ownership immediately. receive pmt right away
gradual sale
finance long-term pmt
lease agreement
commit to a contract that details the conditions & pmt you'll receive for the temporary rights to the biz (not really sell the biz. you just have someone else manage while you're away)
estate & gift tax obligations
(3) file for bankruptcy & liquidation
prepare an inv & determine assets for sale
secure merchandise
set liquidation value of assets with a qualified appraiser
use that value to estimate net sale proceeds and re-evaluate your decision
choose sale type: negotiated, consignment, internet, sealed bid, or retail
select the best time and location for your sale
hire an auctioneer, dealer, broker, or other expert to conduct
use a non-recouse bill of sale so buyer accepts the associated risk