Young Enterpreneur Advice (incorporate, health insurance, proprietorship, sales)

[npumcrisz]

For those of you who have business or have had one.

Is it best to incorporate or not to. What advice would you give us.

[GreenMachine]

It depends on what type of business you have!!!

If you give us a few more details, we might be able to help!


Greenie

[npumcrisz]

Originally Posted by GreenMachine

It depends on what type of business you have!!!

If you give us a few more details, we might be able to help!


Greenie

Does it matter which type of business? I thought business was ans is business.


I am presently contemplating. Am leaning towards a home base business and trying to perform the following services:-

1. Part time web designer/ free lancer.
2. I am a licensed NJ state and national Nuclear Medicine Technologist. I would love to perform diagnostic images in doctors offices and have out of pocket private health liability insurance already. Thought about this opportunity came from a former co-worker who is now doing this.
3. Drop shipment e-commerce retailer.
4. Any other thing I could do to make extra money.

[GreenMachine]

Originally Posted by npumcrisz

Does it matter which type of business? I thought business was ans is business.


I am presently contemplating. Am leaning towards a home base business and trying to perform the following services:-

1. Part time web designer/ free lancer.
2. I am a licensed NJ state and national Nuclear Medicine Technologist. I would love to perform diagnostic images in doctors offices and have out of pocket private health liability insurance already. Thought about this opportunity came from a former co-worker who is now doing this.
3. Drop shipment e-commerce retailer.
4. Any other thing I could do to make extra money.

Yes, it matters what type of business. If you are a freelance web designer, you can work as a sole proprietor. I don't know about the "Nuclear Medicine Technologist" or the e-commerce retailer. You may be able to work as a sole proprietor for these as well. You may also need to get a business license and other types of insurance. You are going to have to ask around to see how others are doing it.

Essentially, it depends on how you want to structure your taxes, how many people you have working for you, and how you plan to protect your personal liabilities in case somebody sues your business.

I think the best thing for you is to first decide what business you want to go into. Once you narrow it down, and get whatever training you need, then you can speak to a professional in regards to how you legally want to structure you business. Or you may find out everything you need just by doing a little research on the web.

Greenie

[NJ Chutzpah]

What does a nuclear medicine technologist do? Well whatever having a skill like that is very valuable especially a medical one, because there should be little or no downturn to it.

Do not be a sole proprietor, you do not want all the responsiblility if something goes bad.

I would go with the nuclear medicine, but it will be relationship based, meaning you gots to sell yourself.

But I would not do sole proprietor because if something bad happens, it will cost lots of money because it is medicine.

[sunsprit]

It REALLY does depend upon the type and nature of the business products and services you intend to provide.

If it's a limited scale product business with little chance of harm coming to the owner of your product, then sole proprietorship may be the most efficient way to own/operate your business.

If there's any chance of your product being used/misused in a way than can cause harm or loss to a owner, then you'd want to form a corporation. For the most part, sub-s corps may be the way to go if your business is strictly a professional service as opposed to a product based company. The difference in the costs of forming the corp and registering it are miniscule, and the costs of operating it are about the same for a small company.

The best route to advice for your specific final business situation will still come from your accountant, lawyer, and trusted tax/legal/insurance advisors. The specific advantages/disadvantages will vary greatly from state to state, too. It's a lot more efficient to ask and get organized appropriately up front than to try to sort it out later on, especially if you are dependent upon suppliers for your products and/or raw goods, banking relationships, insurance relationships, etc.

[goodbyehollywood]

I have had an S corp, a C corp and a SP. SP is by far the easiest for a web designer. The paperwork and taxes for a corporation is a pain and you'll have to have a board, bylaws, annual mtgs, etc. For a small, one-owner business, it may be more of a hassle than a benefit. You can always purchase liability insurance, and many clients will want-- or demand-- that you have it.

There really is no one size fits all. You are going to have to narrow your choices, hone your strategy and declare a business category. Make some decisions and hire an accountant or attorney to guide you. It'll be the best $500 or so you ever spend. Good luck!

[npumcrisz]

Originally Posted by goodbyehollywood

I have had an S corp, a C corp and a SP. SP is by far the easiest for a web designer. The paperwork and taxes for a corporation is a pain and you'll have to have a board, bylaws, annual mtgs, etc. For a small, one-owner business, it may be more of a hassle than a benefit. You can always purchase liability insurance, and many clients will want-- or demand-- that you have it.

There really is no one size fits all. You are going to have to narrow your choices, hone your strategy and declare a business category. Make some decisions and hire an accountant or attorney to guide you. It'll be the best $500 or so you ever spend. Good luck!

What is an SP?

Don't worry I figured it out.

[emilybh]

I can tell you from a health insurance deductibility standpoint, S-Corps and LLCs are the worst. They allow the business to deduct the cost of the health insurance , but the greater than 2% shareholders of the corporation (which means you) have to pay for their insurance on their individual tax return because it gets figured in as wages.

With the other entities, you can fully deduct the cost of your insurance.

You can also take advantage of something called a Section 105 plan as long as you are not a greater than 2% shareholder of a Sub-S or LLC, which if your business is going to be a family run business with no outside employees enables your spouse to help you in the business and if you have a bad year with lots of medical expenses (besides insurance costs) such as co-pays, deductibles and non insurance eligible costs, like massage, reiki, acupuncture etc, through a Section 105 plan you'd be able to deduct all of those expenses for the whole family from the very first dollar.

Without one of these plans, you'd have to wait until your expenses exceeded 7.5% of your adjusted gross income before they could be deductible.

7.5% of $100,000 is $7,500 which would mean more than $3000 of taxes saved in your pocket. But not if you choose the Sub-S or LLC.

[pghquest]

Originally Posted by npumcrisz

Does it matter which type of business? I thought business was ans is business.

It 100% does matter, I run a home based business, do over $1,000,000 a year in sales and I'm not even a corporation, I run as a DBA.. chances of me being sued is nill to none because of the type of business I have, and taxes are a non-issue. Some busineeses have no need to incorporate, you can run as a DBA until your established