I was hoping that my 100th post was going to be more memorable than this. The reason that I haven’t been blogging more is because I have been wrapped up in governmental red tape. I have been putting into place all of the necessary documents to incorporate my online company.
The first hurdle was to decide what type of company that I wanted to develop. Since most of my sales were going to be derived online, I thought about going through a simple incorporation or just a sole proprietorship. The problem with this type of structure is that you have fewer legal protections and it is harder to separate your personal finances from those of your business should something go wrong with the business. The benefit of this structure is that it costs less to develop.
But I was afraid that I was being myopic by not looking at the bigger picture. What if I wanted to get investors to help take the business to the next level? I have already received overtures from some big moneyed people for me to work for them in their businesses. What would happen if they would want to invest in my lowly adventure?
I finally decided to create an LLC. Of course, this costs more money in NYC because you have to publish an announcement of your company in two sources for six consecutive weeks. The first quote is for $700 for one of the newspapers. This particular newspaper is a requirement from the Secretary of NY State.
I have an EIN (Employer ID Number) now which was retrieved online and was free. This means that I can start paying payroll and receiving and paying payroll taxes. Now I am waiting for my NY sales tax certificate to come through. Once I get this back, I will be able to apply for my resale tax certificate which will allow me to not have to pay NY sales tax on items that I purchase for my business.
After all of this happens, I will be able to set up my ETSY shop. It will probably take me 10 years of ETSY sales to recoup the monies that I am spending.