Like anything in life, neglecting the small things, when it comes to your business, can ultimately be your undoing. You can have the smartest idea for a breakthrough product but forgetting to patent your new technology leaves you vulnerable and ultimately all you have left is a product that a big company will come along and scoop up, and you’re right back where you started.
Setting up your business the right way from the start is the same way; missing one small step (or even doing the steps out of order) can leave you vulnerable and, in some cases, personally liable for any potential lawsuits and damages. One of the first things you’ll need to do when starting your business is to incorporate. An LLC will often be the best option when starting a home based business, as it will provide a great amount of protection, it’s fairly painless to setup and is a fairly inexpensive way to incorporate. Incorporating is much cheaper if you do it yourself, but hiring someone to do it for you will ensure that you don’t forget to dot the i’s and cross the t’s. The last thing you want is to find out 5 years down the road that you’re not protected because you filled out the paperwork incorrectly. A service like this will typically cost around $500-$1000.
Taxes and fees can also add up when starting a new business. You’ll need to pay a filing fee for your corporation, fees to the secretary of state (if applicable), and first year franchise taxes. General excise taxes and quarterly state taxes are ongoing taxes, but will add even more to the initial costs; keep these in mind when planning your first year’s budget. Hiring a CPA is recommended to make sure that you don’t forget anything and so you can take advantage of any tax breaks specific to your business/industry.
Fees, taxes and filings can be overwhelming (especially since the majority of entrepreneurs are strong leaders, but not necessarily detail-oriented). This is perhaps the strongest case for starting a franchise, because the franchisor will provide guidance, assistance and in many cases will handle the initial paperwork and first year budget planning. If you’re apprehensive about starting your business after reading this article, make sure you look into the option of a franchise and ask the franchisor what support services they provide.
Read more about The Cost Of Starting A Home Business at HomeBusinessBug.com
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