Tax ID #??

Question

I'm thinking of becoming an independant distributor to sell a certain product in my area.Do you think I will need a tax I D number?

Answer 1

It's up to you. You were born with a tax ID: your social security number.

However, if you want your business to have a tax ID - that has its own advantages. First, you can deduct your operating expenses against your revenues. Secondly, you can limit your liability depending on how you structure it. You get sued as a distributor as yourself and you can lose everything. Your company gets sued, all you can lose is your equity in the company. Third, it's a lot easier to market yourself when you have a tax ID (i.e. you are a company).

The downside: a) it costs money to incorporate, b) it takes time and effort, c) it takes money to get the other doodads associated with a business.

If you're serious about running a business and you have something to lose - incorporate. If you are just doing this on a whim and haven't anything to lose, then perhaps its best to operate as a professional individual instead of a business.

Answer 2

go to incorporatetime.com very simply. tell them you want to start an llc. tell them the name of your company. give them your address. ask them to file for you in the state, and to order a FEIN. i did it twice through that site, it cost me about $240 each time. they also give you a nice binder with your company name, a stamp, and some other useful tax info. You can also opt to have them do the filing for you. then you can go to the secretary of the state's page and request a tax ID number. this might save you a few bucks.

Answer 3

Yes, definitaly. If you don't and someone turns you in, you can be in deep trouble with the gov. You will have to charge tax on the item also. and you will have to file quarterly. This is experience talking.

Answer 4

use you social security number, unless you plan to incorporate