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Old 04-19-2011, 09:14 PM   #1 (permalink)
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Default Starting a business...need advice!

Hey guys,

Do any of you use a seperate checking account for your sports cards?? For buying/selling??

If I'm mainly gonna be selling online and at a few shows, do you think I need to set up my own sole-proprietorship or S-corp as one guy recommended me to do? Do any of you do this?

Are there any special titling or registrations that I need to take care of if I just want to be able to buy and sell online? What about taxes? Do you guys have a seperate tax ID number besides your SSN for your business??

Thanks in advance!
Brady
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Old 04-19-2011, 10:42 PM   #2 (permalink)
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Quote:
Originally Posted by hunterfan48 View Post
Hey guys,

Do any of you use a seperate checking account for your sports cards?? For buying/selling??

If I'm mainly gonna be selling online and at a few shows, do you think I need to set up my own sole-proprietorship or S-corp as one guy recommended me to do? Do any of you do this?

Are there any special titling or registrations that I need to take care of if I just want to be able to buy and sell online? What about taxes? Do you guys have a seperate tax ID number besides your SSN for your business??

Thanks in advance!
Brady
I would recommend that you set yourself up as a sole proprietorship in which case you would only use your SSN as your tax ID number. It's the least hassle IMO. You should purchase a business license and resell license, both which are fairly cheap, and just be sure to keep all your receipts and everything, because ebay and paypal will report sales over $20,000, so if there are any discrepancies and you're audited, it will take out your entire profit margin. I'm sure there are others on here who can give you more details than me, though. Good luck!
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Old 04-19-2011, 10:46 PM   #3 (permalink)
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No No
Sole lol

LLC
Open a separate account, file for an LLC and hire yourself.
That way if you screw up like a tard your house is safe, your family, your other accounts,etc
Sole proprietor is the way to get raped over and over when you forget to pay a tax and they shut your business down and take your house,etc,etc

Jim, nice input but on the back end it's the worse thing a person can do.
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Old 04-19-2011, 10:49 PM   #4 (permalink)
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LLC Like stated! LIABILITY is the most scary thing.
Keep everything separate. Private and Business.

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No No
Sole lol

LLC
Open a separate account, file for an LLC and hire yourself.
That way if you screw up like a tard your house is safe, your family, your other accounts,etc
Sole proprietor is the way to get raped over and over when you forget to pay a tax and they shut your business down and take your house,etc,etc

Jim, nice input but on the back end it's the worse thing a person can do.
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Old 04-20-2011, 01:05 AM   #5 (permalink)
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Form an LLC.
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Old 04-20-2011, 01:09 AM   #6 (permalink)
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I have an LLC, however I have to pay an annual $800 to the man just for being that. Not for sure if that if all states are like that, or just California. Also, you should really sit down with a CPA or tax agent and see what fits you best. You really may not need to become a business.
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Old 04-20-2011, 01:48 AM   #7 (permalink)
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Thanks for the replies guys...I actually called a local H&R Block tax guy to ask him some questions...he was very helpful.

Said he would form it as a sole proprietorship. I asked him about the liability issue, and he explained that I really don't have much to worry about. He mentioned that there's not a whole lot of liability in this business of buying/selling cards online. Would you guys agree/disagree???

I can't remember how else he explained it, but I'll post it when I can clarify further.

Other than that, he said I wouldn't need any licenses. Just register my trade name with the state, get a seperate checking account set up as a sole-proprietorship, and go from there.

I do agree with what you guys are saying, but I also trust a tax guy from H&R Block. His buddy had a card business, actually brick and mortar in addition to online, and he said he had it set up as a sole proprietorship.

Appreciate the comments and welcome more!
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Old 04-20-2011, 02:00 AM   #8 (permalink)
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The only reason I have the LLC is because of my high end consignment I was doing at one point. Other than that - I would have not gone LLC. It can probably be debated all day by everyone here because we all have opinions. I just finished my taxes last week and my CPA has told me I need to cancel my EIN and get a new one that is a Sole-Proprietorship. In plain - there was no true benefits to having a LLC last year, it actually cost me.

But I have to ask again - are you sure you really need to be a business and registered with the state as a SP? What is the benefit for you to do this?
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Old 04-20-2011, 02:43 AM   #9 (permalink)
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??? You go to a Tax guy for Tax information. You go to a lawyer for Liability information. Are you going to trust the H&R guys knowledge about Liability?????? Just some food for thought.

LLC is good to protect your assets. But a good lawyer can sue your azzzz no matter what. (That is why Ebay cannot be brought down, Ebay got Big $$$$$ lawyers that we average "joes" cant afford. Its not about right or wrong, it is about "who has the best lawyer MONEY CAN BUY").

As long as a MCnoob doesnt cut their finger opening your nicely taped toploader and decides to sue you, you will be fine... i guess....jk.
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Originally Posted by hunterfan48 View Post
Thanks for the replies guys...I actually called a local H&R Block tax guy to ask him some questions...he was very helpful.

Said he would form it as a sole proprietorship. I asked him about the liability issue, and he explained that I really don't have much to worry about. He mentioned that there's not a whole lot of liability in this business of buying/selling cards online. Would you guys agree/disagree???

I can't remember how else he explained it, but I'll post it when I can clarify further.

Other than that, he said I wouldn't need any licenses. Just register my trade name with the state, get a seperate checking account set up as a sole-proprietorship, and go from there.

I do agree with what you guys are saying, but I also trust a tax guy from H&R Block. His buddy had a card business, actually brick and mortar in addition to online, and he said he had it set up as a sole proprietorship.

Appreciate the comments and welcome more!

Last edited by h4auto; 04-20-2011 at 02:47 AM.
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Old 04-20-2011, 02:54 AM   #10 (permalink)
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Ok
Liability #1
" OMG ! I didn't get the card you sold me, I am suing you AND I am filing FEDERAL FELONY Mail fraud charges"
AS a company,thats a torpedo and it can be over a 1.00 card.
As a sole P, that is the US Gov't taking your house from you.

Look

People are going to tell you to go cheap,clearly these people have a pot to piss in,but no window to throw it out of.

If you can factor in the cost vs profit,then go LLC.
This is 100%, ouch I am still hurting but I have a house, cars...TV...THINGS since I was an LLC, experience speaking

If you are marketing a tangible asset do not mess about and factor in "FAIR" as a reason to duck costs and go a different route.
I had an employee sue my ass out of business when I owned my Temp agency. I was set up and slammed. If I were a Sole P I would no longer have anything. I would be a retired man living in a half-way house because I wanted to save 300-400/yr

You can take everyone's advice with a grain of salt, but this is fact...People will steal if they think they can get away with it

You want a serious and straight forward chat ? Find you an Asset seizure attorney. He will tell you what you can do and what way to go. Don't find an 80 year old guy in Podunkville with a secretary who is his niece. Find a man affiliated with a firm and pay the consultation fee.
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Old 04-20-2011, 03:00 AM   #11 (permalink)
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1000% true.
LLC is like insurance. You need it but may never use it.
Sole Pro. is like driving without insurance..... actually worst.

Quote:
Originally Posted by Gibberish View Post
Ok
Liability #1
" OMG ! I didn't get the card you sold me, I am suing you AND I am filing FEDERAL FELONY Mail fraud charges"
AS a company,thats a torpedo and it can be over a 1.00 card.
As a sole P, that is the US Gov't taking your house from you.

Look

People are going to tell you to go cheap,clearly these people have a pot to piss in,but no window to throw it out of.

If you can factor in the cost vs profit,then go LLC.
This is 100%, ouch I am still hurting but I have a house, cars...TV...THINGS since I was an LLC, experience speaking

If you are marketing a tangible asset do not mess about and factor in "FAIR" as a reason to duck costs and go a different route.
I had an employee sue my ass out of business when I owned my Temp agency. I was set up and slammed. If I were a Sole P I would no longer have anything. I would be a retired man living in a half-way house because I wanted to save 300-400/yr

You can take everyone's advice with a grain of salt, but this is fact...People will steal if they think they can get away with it

You want a serious and straight forward chat ? Find you an Asset seizure attorney. He will tell you what you can do and what way to go. Don't find an 80 year old guy in Podunkville with a secretary who is his niece. Find a man affiliated with a firm and pay the consultation fee.
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Old 04-20-2011, 04:44 AM   #12 (permalink)
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For TAX purposes a Sole is the way to go. If you are worried about liability, then LLC is the way to go. No matter whether you are a LLC or a Sole setup, you wont be protected from federal mail fraud considering you are the only employee and owner.

The best advice in this thread is seek not only tax advice, but that of an attorney.
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Old 04-20-2011, 08:15 AM   #13 (permalink)
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Quote:
Originally Posted by hunterfan48 View Post
Thanks for the replies guys...I actually called a local H&R Block tax guy to ask him some questions...he was very helpful.

Said he would form it as a sole proprietorship. I asked him about the liability issue, and he explained that I really don't have much to worry about. He mentioned that there's not a whole lot of liability in this business of buying/selling cards online. Would you guys agree/disagree???

I can't remember how else he explained it, but I'll post it when I can clarify further.

Other than that, he said I wouldn't need any licenses. Just register my trade name with the state, get a seperate checking account set up as a sole-proprietorship, and go from there.

I do agree with what you guys are saying, but I also trust a tax guy from H&R Block. His buddy had a card business, actually brick and mortar in addition to online, and he said he had it set up as a sole proprietorship.

Appreciate the comments and welcome more!
no offense but half the guys at hr and block are morons go to a real CPA like most said unless your going be doing some serious selling you might not need to do anything
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Old 04-20-2011, 08:46 AM   #14 (permalink)
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Quote:
Originally Posted by hunterfan48 View Post
Hey guys,

Do any of you use a seperate checking account for your sports cards?? For buying/selling??

If I'm mainly gonna be selling online and at a few shows, do you think I need to set up my own sole-proprietorship or S-corp as one guy recommended me to do? Do any of you do this?

Are there any special titling or registrations that I need to take care of if I just want to be able to buy and sell online? What about taxes? Do you guys have a seperate tax ID number besides your SSN for your business??

Thanks in advance!
Brady
A lot of information can be found on IRS.gov and then it also depends on the state you live in for the licensing you will need. I have a single member LLC and I am considered a disregarded entity and I pay my taxes the same as a sole proprietor. It is not necessary for a SMLLC to get a EIN from the IRS, but you will need one to open a "business" account. Anyone can get an EIN. I live in Ohio and here all you need to sell online is a Delivery Vendor Liscense for $25, but again you need the EIN to apply for the liscense. With this liscense number you can then buy wholesale from any distributor. I didnt go to all this trouble just for sports cards because I also sell many other products. You have to then register with your state tax department and send in all collected sales tax for sales within your state. If you are selling online you do not have to collect sales tax for items being shipped out of your state. Even if you dont want to get a true business account it will be easier for you to track profits by at least opening a different checking account. But definitly check out IRS.com, they have lots of answers to all your questions you can email them with questions and they are very good about getting back to you. No need to hire an attorney to sell on Ebay.
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Old 04-20-2011, 08:48 AM   #15 (permalink)
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yeah I think it kinda depends on your personal situation and how much money you have/finances etc.... because if your operating on a very cheap "broke" level, the llc wouldn't be the way to go.... but if you have the money it would be......

if you were 100k in debt, don't own anything, and have credit cards up the wazoo, then a LLC would be completely useless.... because if you get sued all it would do is add another amount on the total you already have.

but if your a responsible individual, the LLC is nice to protect house, cars etc that you could be sued for in the event of an issue coming up, which probably never will, but it's better to have the insurance just incase.

I think it also depends on what type of volume your going to do sale wise. couple thousand profit yearly, not much need to do anything, over 20k & up a year just from cards. yeah i'd do the LLC.
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Old 04-20-2011, 08:59 AM   #16 (permalink)
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It's all about volume.

If you start up with a 50k investment straight up, then go LLC.

If you are snowballing with your own money (like 2-3k) there's no need to do anything else until you reach a 20-25k inventory / sales mouvement.

The structure will suggest itself based on your volume and work ethic.
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Old 04-20-2011, 09:27 AM   #17 (permalink)
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What exactly are you going to be doing though?
Selling boxes/cases?
Just singles?
Will you get a website? Or just go on eBay?
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Old 04-20-2011, 10:02 AM   #18 (permalink)
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Listen to others before me and seek a lawyer. H&R Block really? I wouldn't even go to them for tax advice.
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Old 04-20-2011, 10:08 AM   #19 (permalink)
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You will need a Tax ID issued by the government and a State Tax #. My question is though with the new regulations set fourth by Upper Deck and Panini unless you have a store front you will not be able to buy any new product from distributors and you will lose money if selling boxes on ebay!!
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Old 04-20-2011, 10:22 AM   #20 (permalink)
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You will need a Tax ID issued by the government and a State Tax #. My question is though with the new regulations set fourth by Upper Deck and Panini unless you have a store front you will not be able to buy any new product from distributors and you will lose money if selling boxes on ebay!!
IMO...I don't see those programs lasting forever. Anyways there is more to sell besides sportscards that will bring in much more money, not to mention other perks of tax ID's. Example...if you go to an auction you don't have to pay the sales tax with your resellers license if you plan to resell what you purchase. Storage Auctions for me...
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Old 04-20-2011, 10:33 AM   #21 (permalink)
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Turning to a message board (especially one like this) for that kind of advice is your first mistake. Lots of bad information being spread... go to a professional.
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Old 04-20-2011, 10:34 AM   #22 (permalink)
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And if this will be a business where you will sell a ton of cases/boxes through a website/eBay, you will need a heavy investment into inventory.
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Old 04-20-2011, 10:43 AM   #23 (permalink)
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Quote:
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And if this will be a business where you will sell a ton of cases/boxes through a website/eBay, you will need a heavy investment into inventory.
^^^^^ What he says...

Starting up as a 'business' needs a strong cashdown, otherwise you are trading pennies
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Old 04-20-2011, 11:35 AM   #24 (permalink)
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Real quick...appreciate all the replies!

I just was wanting to get some opinions...I'm not only going off a message board. I will consult a lawyer and was planning to do so...it was more to just get some opinions from other members how they run their own business to give me more of an idea.

Again, I just contacted the H&R block guy because I figured he could help me a lil bit and maybe point me in the right direction.

I should have stated up front that this has been a hobby/business for the last 4-5 years as I went through college. This is not a FT gig yet; I work 40 hours and this is something I do cause I like to do it in my free time. So, do I have a $20,000 investment?? No...not even close.

I'm gonna be taking some funds from my personal to start a seperate business checking account for my cards. I primarily buy/sell singles online. I'm not gonna be buying boxes or cases from distributors any time soon.

As some have pointed out, I'm on the low end of the spectrum. So, based on my situation, would you still recommend I set up an LLC at this point?

I most definately will consult a law attorney. Again, I appreciate all the comments...they are helpful in helping me get started!

Thanks guys...
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Old 04-20-2011, 11:39 AM   #25 (permalink)
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[QUOTE=jimssouvenirs;1239176]. You should purchase a business license and resell license, QUOTE]


I didnt' know I had to do this just for selling online. If I'm set up as either a Sole-P or LLC, do I need these licenses??
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