MyCorp FAQs: Do I Need an Employer Identification Number?

An Employer Identification Number, also called an EIN or a Federal Tax Identification Number , is a unique set of digits assigned to a business by the IRS. With it, tax agencies can easily track the financial activity of your company, and make sure that you pay your taxes. employer identification numberBut, if you run a sole-proprietorship, the IRS can already do that using your personal social security number. So in what cases do you need an Employer Identification Number?

When you hire someone

The only time you can really get away with using your social security number is when your business is considered a sole-proprietorship, and you’re the only employee. The IRS figures, in cases like that, the company’s profit flows directly to you, and you pay your taxes from that. But that changes the minute you bring anyone on to help run the company, and that includes a business partner. Once you start hiring, your company must have an EIN.

When you form an LLC or Incorporate

Incorporating or forming an LLC separates you and the business. Continue reading

MyCorp FAQS: Can I Be My Own Registered Agent?

The short answer – yes. But, regardless, it may still be a good idea to hire someone else to be your registered agent. Registered agents exist because of due process. When you turn your business into its own, separate legal entity by forming an LLC or incorporating, you’re effectively giving it a right to due process. registered agentThat means, before a lawsuit can go forward, your business must be properly notified. A registered agent, then, is the point of contact for notifying your business about impending lawsuits.

However, many states use a business’s registered agent as a contact point for other important matters. They’ll send state documents, franchise tax forms, and other reminders to the company’s registered agent, rather than to the company itself, since reaching an established point of contact is a pretty reliable way of getting in touch with the business.

For a nominal fee, you can appoint someone to be that point of contact.

So why wouldn’t you want to be your own registered agent? Acting as your own registered agent will save money, but there are downsides to that choice. For one, a registered agent must have a physical address within the state the company was formed in. So if you formed and do business in a state other than your own, you have to designate someone in that state as a registered agent.

Further, registered agents are the contact point for sensitive matters like lawsuits or summons. Having a registered agent outside your company keeps the office from panicking, like they would if you were served in your own office.

And finally, your registered agent is going to get a lot of important paperwork. It’s their job to keep track of what they receive, and send it along to you. When you run a business, it’s easy to overlook or forget about things like annual reports and fees. A registered agent will really help you from losing track of that important paperwork.

You – or in some states, your business – can act as the registered agent. Or you can hire an outside agency. Just be sure, regardless of what path you choose to follow, that your registered agent is dependable and discreet.

MyCorp FAQs: Should I file in a state with no income tax?

This is easily one of the most commonly asked questions we get. Each state has different rules and regulations when it comes to income tax. Most have both, some don’t collect personal income tax, and a few don’t college corporate income tax. And to a new business owner forming a corporation, forming in a state without a corporate income tax might sound awesome! income taxAfter all, who likes paying taxes?

Unfortunately, things aren’t that cut and dry, and there are good reasons why so many business owners opt to stay in the state that they do business.

You can form a corporation in another state

Continue reading

How MyCorporation Helps Franchises

Recently we’ve started exploring an often over-looked sector of American small business – franchises. Franchising is a major part of our economy, accounting for 4-5% of the country’s GDP, according to the IFA. It’s also a great way for people to be their own boss and open a business, without having to start from scratch. FranchiseA misconception amongst would-be franchisors, however, is that they’ll get everything they need from the main-office. While that’s partly true, there are a lot of ways MyCorp can help franchisors.

We act as another level of support

When you buy into a franchise, you usually get three things from the head office – a right to use its name, access to its system of success, and some assistance when you first start out. Continue reading

Business Basics: Reinstatements

Reinstatement is what you have to do to get your business out of an inactive or bad standing with the state. And this time of the year, we’re getting tons of requests and questions about reinstatements from people who let their corporation or limited liability company to lapse, but want to get things rolling again before we get too far into 2015.
Reinstatement Luckily, the reinstatement process is pretty straight-forward, though depending on the reason for the lapse, it can get a little pricey.

How does a company become inactive, or get put in bad standing?
There are a few different ways this can happen. But one of the most common reasons behind a bad-standing is simply the business’s owner forgetting to pay their annual fee. Continue reading

There’s Still Time to Lower your 2014 Taxes

The 2 Tax Deductions that Business Owners Often Leave on the TableThe holidays are over– and so is 2015. You know what that means…taxes! If you haven’t started getting your 2014 taxes in order yet, you need to take the turn of the New Year as a sign that you should get going. After all, the sooner you start, the more time you have to get everything right.

Think back to the beginning of 2014. Did you wildly overpay? If so, that’s because you didn’t take advantage of all the methods you have at your disposal to lower your tax bill. Here is a handful you should definitely take a look at ASAP. Continue reading

Business Basics: End of the Year Prep

The end of the year is right around the corner, and every year we hear small business owners panicking about December’s rapidly approaching end, wondering what they have to do to end the year right. Not to worry – ending the year is actually pretty easy, as long as you don’t wait until the last minute to get everything done! So if you haven’t already, start thinking about…
End of Year Prep

Submitting any filings or dissolutions

Some of the most common questions we are asked revolve around the best time to form an LLC or incorporate. And while there are no ironclad answers to those questions, the beginning of the year is normally a good time to send in that paperwork. Deadlines and renewal dates are easier to remember, staying on top of your taxes is simpler, and you can even file your paperwork early and miss the beginning of the year rush if you opt for a delayed filing. Continue reading

4 Simple Things you can do to Prepare your Business for Tax Season

owning and operating a small businessIt might seem like you just finished filing last year’s taxes (and if you got an extension, then maybe you actually did!) but next tax season is already on the horizon. And while preparing to file might not be at the top of your priority list, getting a jump start will eliminate a lot of unnecessary stress when it comes time to submit your business tax return.

To help make your life easier, here are four things you can do right now to prepare your business for tax time. Continue reading

ABCs of Small Business Industry: I is for Insurance

This week we decided to cover a relatively broad small business sector – the insurance industry. Now, the insurance industry is a heavily regulated, slightly complex field to work in. There are tons of hoops that independent agents and brokers have to jump through before they are even allowed to open their doors. Insurance Industry But it is a vital industry – in some cases insurance is required by law – so a business could do quite well within it. So how do you start a company in the insurance industry? And is it worth all of the effort?

How do you get started in the insurance industry?
Insurance is a regulated field, which means you need to be licensed before you can begin. You also usually have to take some sort of course as well before the state will issue you your license. Continue reading