Do you know about - How to Start a Home Photography enterprise in North Carolina
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After years of pursuing photography as an avid amateur photographer, I decided to ultimately take the plunge and become a professional. I already owned all the requisite camera bodies, lenses, flashes and other various equipment, and having my own business meant hereafter photography purchases would be tax-deductible. A smart decision, right?
What I said. It is not outcome that the true about State Farm Insurance. You see this article for info on anyone need to know is State Farm Insurance.How is How to Start a Home Photography enterprise in North Carolina
The short answer, for me at least, was "yes." The long answer, however, was, "It depends on how much time you want to spend running around and researching the requirements."
Fortunately for you, I've done it already in North Carolina and am willing to share the results (for this state, at least!).
For the purposes of this article, I'm assuming the following things are true:
1. You will be operating this business in the state of North Carolina.
2. You already have the photography expertise to qualify as a pro photographer (that's another article all by itself).
3. You've done the requisite research to conclude either you have the time, energy, inherent customer base, and business plan to ensure your new investment succeeds (again, this topic is another article on its own).
The first step was determining what kind of business entity to be. After doing much research online, I was a bit confused, until a Cpa explained it to me: there is a variation in the middle of your Legal status and your Tax status. She recommended that my photography business be an Llc (limited liability company), but file taxes as a sole proprietor.
As with all the different options, there are positives and negatives to each option. Llc status would protect me from personal liability in the event of a lawsuit, which was foremost to me. The paperwork is very easy to prepare and submit, which is also good because I wanted to take care of everything myself.
Filing taxes as a sole proprietor would be very simple: just attach a program C to my personal tax return each year. Although this filing status is easy enough, sole proprietors pay a slightly higher tax rate than S-Corporations.
Filing as an S-Corp, however, means more paperwork and filing regular taxes instead of a program C with my yearly return. I wasn't interested in that much paperwork, so sole proprietor status is fine with me. If and when my business starts manufacture so much money that I'm interested in a lower tax rate, I can always convert my status to an S-Corp.
Now that I've carefully my legal status and tax status, I had to file for my Llc with the state of North Carolina. This involves sending a check for 5 to the Secretary of State, along with Articles of Organization, which can be downloaded and filled out from their web page.
It takes about 7-10 days for your status to come back confirmed, although if you consist of a note and your e-mail address, they will e-mail it to you which will save a few days.
The state of North Carolina considers photographers to be one of those lucky professions that want a State Privilege License. This is an yearly license granted to the person, not the business, so if you end up working for a different photography business in the future, you don't need to get a second license that year. A privilege license is 0, from the North Carolina wage Office. This must be done in person, but the wage division has offices all over the state, so there's probably one in a city near you.
While I was there, I also received a State Tax Id. This is (fortunately) free, and it will come in handy because armed with this foremost number, I will no longer need to pay sales tax when purchasing items for my business (assuming I'm purchasing from a North Carolina vendor; obviously you don't pay sales tax at all when purchasing from an out-of-state vendor, such as when I buy lenses online).
The kindly and helpful Nc wage worker explained to me that two forms will need to be mailed into the Nc wage Office each quarter. One is a form explaining what your revenues for the quarter were and how much tax you expensed your clients. You will need to consist of a check for the tax amount. The other form shows what tool you purchased for your business that quarter and didn't pay tax on. You will need to consist of a check for 1% of the total (hey, at least it's lower than paying the full retail tax on your purchases). This includes everything from cameras and lenses to printers, computers, paper, ink cartridges, etc.
Charging my clients sales tax is a bit confusing in North Carolina. The law is not clear, and lawsuits that have been argued in state court have conflicting results. It appears that you do not need to charge sales tax on services such as session fees, Unless the client ends up purchasing prints from the session. Of procedure you always hope and assume the client will buy prints, but you never know for sure. To be safe, you should go ahead and charge them sales tax on the session fees up front, assuming they will buy prints.
You always need to charge sales tax for tangible goods sold. So any prints, albums, or other products that you sell to your clients must always consist of sales tax.
The tax rate that applies depends on where the client took rights of the goods. If the client lives in Gaston County and asks me to mail her the prints, the Gaston County rate applies. If the bride decides to swing by my house in Charlotte to pick them up personally, the Mecklenburg County rate applies.
Tax was by far the most involved part of the business-formation process. Fortunately the employees at the Nc wage office were very helpful, and gave me any "cheat sheets," sample forms, and (best of all) their phone numbers for me to call with questions.
If you want your Nc State Tax Id to be in your business' name, instead of your own name, you will need a manager Identification number from the Irs. I was initially confused by this, because I wasn't planning on employing anyone other than myself, but as it turns out, the manager Identification number has nothing to do with employing anyone. Luckily it was free and handled really over the phone while I waited in the lobby of the state wage office.
Now there's the matter of where you live. I'm a resident of Charlotte, so I'm in Mecklenburg County. Fortunately, Mecklenburg County recognizes the State Privilege License, so I wasn't required to get an additional County business license.
I was, however, required to get a primary Home work Permit from the Zoning Office. This is a one-time permit that allows me to work from home. This is a lifetime permit; however, it only applies to this single address. If I decided to move to a different house in a few years, I will have to get a new permit. It cost 5.
Next, I needed a business checking account. I went right to Wachovia, since they already handle our personal bank accounts and I wanted everything in one place for convenience. Wachovia needed copies of my privilege license, my Ein, and my state tax Id, as well as the general documents for a new account like my driver's license. In about a week, I had received my check card and checks for the account. This is extremely recommended by the Cpa I visited, in order to keep business and personal expenses separate.
The final thing I needed was business insurance. This is recommended in expanding to any homeowner or umbrella liability coverage you may already have. It's not too expensive (less than 0 per year) so go ahead and get it. Any guarnatee agent will be able to go over the options with you. business guarnatee will not only cover your tool in the event any of those expensive lenses or cameras get damaged, but will also help in case a guest trips over one of your lightstands at a wedding, for example.
A few side notes: if your business is an Llc, you are legally required to have the initials "Llc" or the words "Limited Liability Company" in your business name. This makes it clear to all customers and inherent customers that you are an Llc. Also, if you do not keep your business and personal expenses separate, you lose the security of an Llc (meaning your personal assets are vulnerable in the event of a lawsuit). Do Not Risk This -- keep everything well documented and separate!
Best of luck with your new business venture! I recommend visiting the North Carolina State business amelioration website and calling their hotline; they gave me a lot of tips the Cpa didn't mention, and it was free to boot! Fortunately there is a lot of withhold out there for people beginning their own businesses. It's free, and these people know what they're talking about -- please take benefit of it!
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