Business Consulting
Whether starting a new business or getting help with your existing business we can educate you in a variety of ways.
Startup Businesses
Business Plan
Setting up a business plan can be vital to the success of your business.
Entity Structure
The process of starting a business usually involves several elements that are tax and non-tax related. Choosing the right entity is important from the start. Several considerations must be made when deciding what entity is best for your specific business. Taking a look at your short term and long term goals can be the key to selecting the right entity.
Setting up a separate entity
On the Washington Secretary of State website (www.sos.wa.gov) you can file your articles of incorporation or formation and obtain a UBI number (state ID number).
Business Licenses
The Washington State Department of Revenue has made obtaining a business license fairly straightforward. By creating an account on their website at www.dor.wa.gov you can file the application right online. In the process of applying for your state business license you will be prompted to apply for any city licenses as well.
Business Startup Expenses
Startup expenses are defined under IRC section 195 and include but are not limited to, advertising; salaries and wages paid to employees being trained and their instructors; travel and other expenses incurred in lining up prospective distributors, suppliers, or customers; and salaries or fees paid or incurred for executives, consultants, and similar professional services.
These items must be capitalized as “startup expenses” on the balance sheet. Amounts up to $5,000 can potentially be expensed in the first year of operation providing combined expenses do not exceed $50,000. Amounts not expensed in the first year must be amortized over a 15-year period.
Accounting Systems
Having an effective accounting system in place is highly recommended. Too often we see individuals starting a business without the proper accounting system in place, leading to substantial work down the road. Especially when a separate legal entity is present it is important to maintain a balance sheet from the start of the business.
QuickBooks is probably the most popular software and with a large number of users it allows QB to have the funds to continually update their software for ever changing business needs.
Resources:
Internal Revenue Service: www.irs.gov
US Tax Court: www.ustaxcourt.gov
Department of Revenue: www.dor.wa.gov
Department of Labor & Industries: www.lni.wa.gov
Employment Security: www.esd.wa.gov