Discuss: This Web Business IV: Business Entity Options
by Scott Kramer
- Editorial Comments
2 Business intention
Dear,
My name is Honza Seifert. I am from Czech republic. I have a company and make web sides in Czech. My intention is find company in America who are interested us to making web sides for them. We produce really quality graphics art for much lower money than amerivan makers can offer. If you are interested about our graphics art or web sides,please contact me .The best regards J. Seifert
posted at 03:21 am on October 14, 2002 by Jan Seifert
3 re unamerican activities
If you’re in the UK then Companies House http://www.companies-house.gov.uk/ has lots of information about company law and for tax matters then I’d try the Inland Revenue http://www.inlandrevenue.gov.uk/
posted at 10:19 am on October 14, 2002 by Matthew Farrand
4 more unamerican activities
I was a bit annoyed by the US-centric approach of this article. i have no problem with reading an article about how to set up a business in the US, but the fact that the author never even mentions he’s talking about a specific country, and just assumes whoever reads it will be from the US is taking a very narrow view of the readership, in my opinion.
posted at 02:25 pm on October 14, 2002 by kemie
5 Ease up
Hey Kemie,
While I agree with what you are saying, it’s a little unfair. The majority here are Americans, and also that information is gonna be quite a bit different depending on which country you’re in. An American viewpoint was the right choice because it’s (more than likely) what he knew, what most others wanted, and what made the most since from where he was sitting.
posted at 08:16 pm on October 14, 2002 by Adam
6 it's so common
“Here”? Where? On the Internet? Surely you jest.
posted at 11:42 pm on October 14, 2002 by mousie
7 US-centric
I understand your point. The reason I don’t explain these things more thoroughly comes from a history of writing bad fiction in college. Everytime I would write a story for a class, there would invariably be areas circled in thick red marker with the letters “SDT” written next to them. SDT stands for “Show, don’t tell.” I would be explaining, for example, how a person in my story is a really bad guy and worthy of the reader’s hatred. But my professor wanted me to have the reader come to that conclusion on their own by demonstrating my character’s evilness through actions. So I got used to explaining less. In my mind, you should understand that the article is meant for US businesses because that’s all I discuss.
Sorry ‘bout that. I will be more explicit in describing who future articles are meant for. I certainly didn’t mean to annoy or offend anyone.
For the record, all of my articles dealing with law are only useful in the United States. The finance stuff you can probably use in any country.
posted at 06:37 am on October 15, 2002 by Scott Kramer
8 US: the ie5+ of the world
Not meaning to sound too righteous about an article that on the whole was a good read… but:
Just as a good web site should cater for browsers other than what “most” and the “majority” use, so too should a good web article cater for more than just US readers.
Besides, never make assumptions about your users including that of their origins.
posted at 06:39 pm on October 15, 2002 by
9 Bottom Line
When speaking on a topic (or multiple topics as in this article) it is important to state the good and the bad, and not just the bad, which is what I saw when Scott spoke about some of these entities and business structures. All of the listed business structures are used at different times, and can be used in conjunction to create great legal protection, as well as unbelievable tax advantages.
For instance, You can split your services into multiple LLC companies (ie. Hosting, Web Design, Print, etc.) and have a corporation hold all of them. So, your corporation needs a website… Have your Web Design company create it and manage it. Need brochures? No Prob. You own a Graphic Design Company that deals in print. So basically, you just spent $3,000 on a Web Site and some brochures, and your money (that is, your companies money) just went from one bank account to another. So What… So you didn’t really spend any money and you get to write-off $3,000 dollars!
Also, by creating multiple entities, you create businesses that are more specialized, you can sub any work that you get through one company to another, and most importantly, you generate more exposure by creating seperate entities.
Listen, bottom line is this. You are probobly a web designer/developer/whatever. You need to know a little about everything (business, websites, taxes, law, sales, etc.) but have people that know everthing about little (that meens 1 thing like taxes or law) that guide you in the right direction.
To the author, I mean no ill will. You and the guys/girls at ALA take a lot of crap after spending so much time trying to help us. Thanks to all of you.
A business man who owns a web firm.
posted at 08:37 pm on October 16, 2002 by Dave
10 Do Your Homework
One thing that is important in any venture, business or otherwise, is to do a little research before starting out. The differences among cities, counties, states, provinces, countries are significant & will greatly impact your decisions in setting up shop.
One place to start, if you are in the States, is to contact your local small business center (most communities have them) and get details on steps for setting up a business in the area that you live in. The next step would be to pick the brains of your friends & collegues about parts of this that they would be able to help you with—accountants, lawyers & other small business owners would be ideal. & finally, I would recommend checking with the powers that be—those who will care whether you earn income through your venture or not & found out what their guidelines are. In the States I would check with the IRS, your state business office & any local institutions involved in collecting taxes.
I cannot emphasis this enough.
A few years ago I looked into setting up a small Web development firm but decided against it. I still did freelance gigs & simply submitted federal and state taxes via 1099’s. I felt fine about it all. Then I was dragged before the Philadelphia tax discovery unit & told that I owed not only city wage tax, which I could understand being liable for, but business previlege tax as well. When I argued that I was not a business, I was told that my legal status as a corporation or company did not matter to the city. What mattered was that I was generating income, of which they wanted a slice.
Currently I am facing paying the missed taxes, plus a huge plenty of up to 60%. Had I know that the City of Philadelphia considers me a business, I probably would have found an accountant to take care of this stuff for me (DIY did not pay off this time) & would have charged my clients at least 10% more per job to cover the taxes.
posted at 10:52 am on October 17, 2002 by saturdave
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1 Unamerican Activities...
I have a pipe dream about going freelance, or even setting up my own teeny tiny web business, so I was very pleased to read this article (and rediscover the earlier ones in the series). It’s nice to see that A List Apart keeps covering all bases relevant to the webnik.
While I appreciate that A List Apart is “made in America” and the majority of its audience probably hails from that nation, however, I was wondering whether anyone can suggest sources of similar business-type knowledge for non-US websters. Hint: I’m British, so any UK info will be much appreciated.
posted at 01:02 am on October 14, 2002 by Owen