Lessons

Lesson Info

Obtaining a Federal EIN

Are you using your social security number? Be honest with me doria you are aren't you okay? You're all right so you're a soul proprietor but you were smart and you went out and got an e I n number two separate your business activities from your social security number and that is a smart thing to do so regardless of whether or not you're using llc never used your social security number to do business with we need to have an employer identification number which we're going to do do you know who needs an e I n gym I think that would be me and blue steel photography still clearly more importantly I mean it's really all about blue steel today but I appreciate your your needs as well okay so here we go we're going to to figure out how to do this it's a piece of cake you could do it yourself you do not need a lawyer see how much money I'm saving you lorenzo I mean this is cheap thank you you feel the value? I feel it very much sorry let's do an ss for together you goto I rs dot gov not give a...

nd I don't have control of powerpoint on here so I'm actually going to do it just like everybody at home is doing it when it leave go daddy somebody remind me too but if anybody goes and buys a blue steel before I've paid for it I will find you and I will come to your state and I will wreak a legal legal havoc upon you so don't troll blue steel photography anybody that's watching this live I thought of it ok, here we go so www dot the I r s give actually the easy way to find it is just a google I r s s s dash four and look what it does gove dot tax federally I n make sure you go to the government website not the troll website um I'm not sure that it is the government that's good dot that's not it here we go that's the pdf yeah make sure that you're in an irs dot gov website. Otherwise you may be in putting your data into some russian mail order bride websites. I kind of hit it a little bit quickly dd ba is if blue steel photography wanted to start doing business is blue steel landscaping that's a separate name. And in order to have the legal ability to use that name in missouri, I would just go to the secretary of state's website and register blue steel landscaping is a fictitious, fictitious name used by the owner blue steel photography llc and then I would be legal to use that name in missouri or what have you? Likewise, if I you know wanted to register another name to blue steel photography maybe I wanted to do blue steel graphic design I could register that name owned by blue steel photography so it's simple is that seven bucks in missouri? Okay, I believe this is the right web address so if everybody gets there irish stock of um forward slash businesses et cetera, et cetera that is the official government form not any kind of a russian bride ordering form not that there's anything wrong with that? Everybody in the class got that up that wants one. Okay, this is super easy at the bottom of the page it says apply online now now this is a protected computer warning from the government because they're obviously very I'm concerned about our security healthcare duck up and, uh I want to make sure that you understand that if you if you, uh misuse the system you could be prosecuted say okay um and then there's a begin application but please click that all right guys, you're you're you're like halfway through law school right now which button do I click? Mallory tell me are you there with me? Are we sold her pride or now? Yes. No more jealousy are we a sole proprietor? Are we part of sham corporation llc let's click it general continue you've chosen llc continue how many members in this l l c lee how many members? Yes I said that's a single member because we are a husband and wife team what state are we physically located in now if we were physically located in washington we would pick washington here got it everybody get that yes but where am I located? Springfield, missouri home of the springfield cardinals okay we are district were a district under density it says everything gets passed through our tax return we filed ten forty it likes us it's it's just telling us we're simple um not simple minded just simple choose one reason that best describes why you're applying we started a new business we hired employees we want a bank account we changed our type of organization we persist to business what did we do today started a new business who is the responsible party the responsible party is let's just make it an individual we'll make it simple that's me first name and carried a few people are asking about the process of taking a business for missiles proprietorship to an llc is it any different or is it basically starting from scratch it is so easy I want to try and explain how easy it isthe we create the new business and what does that sole proprietorship have? It has assets it might have a camera might have a computer it might have accounts receivable it might have a list of things that we can actually write down right? We're watching the real housewives of where? Green county seattle tacoma or just a coma and uh we just make a list of what we have and then we just do a little bill of sale I craig item and transfer to blue steel photography everything on exhibit a you with me now who owns it blue steel photography we book it in on our quickbooks which I'll show you how to do tomorrow it's literally mindless and now blue steel owns all that stuff so now I've moved from a sole proprietorship into my new l l see I got a bank account you know what ideo how much is in my bank account three thousand dollars I write a check to blue steel photography for three thousand bucks and it's in is my initial capital investment along with all of my other equipment it's live it's it's simple I mean it's there's no barrier to it people think it's complicated or I can't do it it's just not the case and we need to close the former accounts well yeah I mean once you yeah usually once you leave your account with zero dollars in at the bank closes it automatically gets experiment this whole proprietorship do you need to do anything to rock? Not really no mark hold on a sec mark take me off of the screen I won't put my soul security number in here all right bring me back up then it just asks for my address I'm just showing you how simple this is clear. Continue button um, it didn't like the fact that I put a period on there. Tell us about the llc, the legal name of the llc. It has to match the articles of organization. So what does it say on the article's organization? It says blue steel photography what's on the end and it will see doing business as nothing where's it located at greene county, missouri, where the argo articles were filed. Now the articles are filed. Where? Where I found my article's organization, mr missouri, when would when did it start? Well, today is halloween, which is october of ah, twenty thirteen, correct? Yes. Um, well, look out said review it for typos. I put anne in there that when the right name wasn't blu jim, do you agree? Is that the right name? Looks good to me. Okay. Jim says it's good. So it's good with me. Does your business own a highway motor vehicle with a no? My gambling no. Well depends on how I write my business plan. Does your business need to file a quarterly excise tax return? No. Do you manufacture alcohol, tobacco or firearms? Not yet. Do you have or expect to have any employees in the next twelve months? No continue now I have a quick question about I don't mean the first one way says there's this business have any vehicles or what not now if you have a vehicle debt you kind of want to transfer to your completely different that's a sixty five thousand pound vehicle that would be like ten pickup trucks okay that's a great big truck that's so they're just asking if you're even over the road truck company okay so but we'll talk about cars you'll know everything you want about cars including which ones to buy to get the today for included in the bonus materials jim how does your business or what your business do are we uh I answered a question for a photographer on what we do the correct answer is other okay that's what we do if your creative just pick other police choose one of the following that describes your activities I want to go back hold on a second any changes you made will be discarded kansas is that okay if I uh if I click back it should take me to the previous page all right um yeah other that's correct school and then there's another other where we put photography or graphic design or whatever see it or graphic designer art direction or whatever you are all right you want to get your letter online? Yes okay let's review it blue steel photography greene county, missouri formed in october there's my address there's my phone number on the sole member I started new business and I don't have anything submit there's my I n you click on this and this isn't it this is the form you safe right here you see that print this out I'm gonna print it I think I know how you print on a mac but I'm sure it's possible. All right, so thank you. I appreciate it's kind of like a joint like mac tutorial. Like how to form your business on a macintosh? Yes, value it's just losing value, so check it out. Look what we've done, okay? And this has just been in the second half. I mean, we're not we're in the home stretch of the second installment we've now formed the company. We've checked our name to make sure nobody else is using it. We've got ourselves a tax I d number this is probably farther than I'm not judging. This was probably farther than a majority of our our our audience has gotten in the formation legally of their business, okay? And that's okay, but you've got to get it done. It didn't take us any time, andi. We've got our tax I d number and we're all set up so let's pop back over to the power point keynote display and see uh, if we'd go to the next slide one more after that okay let's this is I think I don't want to get too far ahead of myself uh this this tax concept that we have here are new company is gonna have some some tax liability all right let's think about what that could be oh here's my baby look at this here's my my federal letter that I'm gonna put in my company binder with my articles of organization my operating agreement in my tax I d number if I march into any bank pretty much in the united states or the cayman islands I will be able to open a bank account in the name of my company okay? And that's super cool uh so we'll open our new bank account for blue steel photography and we'll start to think about what our tax liabilities could be if we make some money here's the best way to avoid all federal and state and local taxes jim you want to know what it is make no money if you make no money, you pay no taxes. But if we're successful in our business plan starts toe work and we're experiencing growth, we're gonna have to think about federal income tax and again is a single member llc that all flows through just to my little ten forty tax form so it's nothing unusual it just gets reported on schedule see uh if I have employees I'll have to pay fickle, which is the combined secure social security, security and medicare tax I have to pay myself employment tax, which we'll talk about later, and there are certain excise taxes, which generally don't apply to photography businesses. But if you're interested, check out irs publication five ten um moving on to the next slide, but we also have some state tax liability. Um, the state taxes includes state income tax, state withholding tax for employees, retail sales tax, which we'll talk about later, vendors use tax consumers used to x and unemployment checks, so there are some tax consequences to actually making money, but I'd rather make money and pay taxes, then not make money and avoid taxes. Uh, the withholding tax goes along with employees and withholding taxes. You know, if we have employees that were paying and they're making money along the way, the click the, uh, withholding taxes is kind of our doing our part as an employer. To get that squared away, you'll have to register for withholding with your state. You have to have ah, state withholding tax number, and you're gonna pay the combined social security tax. Pika is fifteen ish percent, the employer pay seven and a half ish percent, and the other employees has to contribute their own seven and a half percent so we have to send that in, we pay the employees half, they pay their other half, you have to pay it on time, guys, if you don't pay it on time, there are a number of nasty penalties, and it can actually be some real bad mojo, because if you withhold the money from your employees and I represented companies that have done this hey, bob, thanks for working for the last quarter, my payment withholding quarterly and yeah, I've withheld several thousand dollars that I'll go to credit your account, but, you know, I really gotta pay this album company because I got to get this album to deliver. Teo lovely zoe, her wedding was so beautiful. Did I tell you about it? It was down at the country club in the sunset came in, but anyway, she needs this album, so I am not going to pay your withholding tax. I'm sorry about that, but I'll make it up later. Don't worry about it run don't walk from working for me, that's going to create some potential criminal liability if I take my withholding money and use it for myself to do other company business, so you need to have kind of a separate bank account to put your withholding money in if you're not paying weekly paying on time, bad mojo, if you don't if you do pay self employment tax and again, we're going to talk about that later. That's, where I, uh, is my own employees of my business and drawing a salary it's self employment tax tow full fifteen percent if you wait until the end of the year and you haven't made estimated payments along the way. Oh, my, the government make sure that they get interest and penalties for not making the estimated payment, so pay that quarterly to avoid big penalties at the end of the year. Is that true? For the first year that you're in business? Because you have no idea of what your potential income is going to be, you might not have ideas. What it's going to be alone away that's? Why it's called an estimate, and if you pay too much, they give it back to you if you don't pay enough but you get close enough there's no penalties, it's a little formula that on account nor sepa could help you with you could do it online. There's a calculator for make king estimated tax payments uh, at irs dot gov um, but you have to try. Usually you'll be okay if you don't make the estimated payments, but if you're really successful that's something you'd want to have a conversation with your accountant about