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Legalities
- What legal aspects do I need to consider?
- How should I structure my business?
- What is an Employer Identification Number and where do I get it?
- How do I get and protect my company name?
- What is the difference between an employee and a contract laborer?
- What are the requirements and tax implications of having a home based business?
What legal aspects do I need to consider?
There are many different legal aspects that small business owners must consider. These include: zoning, permits, business structure, taxes, registration, worker’s compensation and many, many more. The SBDC can assist you in determining the appropriate steps necessary for starting or expanding a business. The SBDC also strongly recommends you consult with an attorney on legal issues.
How should I structure my business?
The business structure impacts taxes, liability, owner succession and other areas of your business. The basic structures of business ownership are sole proprietorship, limited liability company (LLC), a partnership, C Corporation (Inc. or Ltd) and a Sub Chapter S Corporation (Inc. or Ltd.). Among other considerations, selection of a business structure depends on the level of control you desire, size and nature of the business and vulnerability to lawsuits. It is advisable to consult with an attorney and an accountant to determine the structure that works for you.
What is an Employer Identification Number and where do I get it?
An Employer Identification Number is a federal tax identification number used to identify business entities. It is absolutely essential if you have employees or operate as a corporation or a partnership.
Most businesses may obtain an EIN via the IRS web site. You will receive federal income tax deposit information and other IRS information via snail mail 4 to 6 weeks after applying.
How do I get and protect my company name?
First, you need to determine if the business name you want is available. This can be done by searching the Kentucky Secretary of State’s database or by calling (502) 564-2848, press 2, and then press 1. Next, you need to fill out paperwork to reserve your name with the Secretary of State. This paperwork requires you to list the business entity that you have selected. We recommend you consult with an attorney to determine the business structure that is most appropriate for you.
What is the difference between an employee and a contract laborer?
Generally the definition of employee is an individual who uses your tools; comes to work on your schedule; you supervise their efforts; and, have custody and control of their work product and environment. An independent contractor owns his/her own company and offers their services or products to several clients.
What are the requirements and tax implications of having a home based business?
Home-based businesses must comply with all local, state and federal zoning, permitting and licensing requirements.
SBDC Consultants are available to assist home-based businesses, but we recommend you see an accountant for assistance in tax preparation or other tax issues surrounding your home-based business.
