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The following are the essential first steps to establishing an internet business for long-term success.
Putting your internet company concept into action involves 10% inspiration and 90% perspiration, much like many other things in life. It's time to go to work now that you've nailed down the ten percent (the concept) and done your due research on viability Make a Business Plan If you want to seek money from outside investors or a lender, you'll need a business plan. You should have a business plan even if you're planning to bootstrap your internet business with your own money. It will assist you in ironing out the intricacies of your business, estimating when it will become profitable, and establishing milestones and targets to measure your progress. Your business plan should include, at a minimum, what items or services you'll offer, your target market, expenditure and income estimates, and deadlines for achieving your objectives. Decide on a Business Structure How you form your company will be determined by how much personal liability protection you want, the tax advantages you seek, and the kind of investment prospects you seek. A single proprietorship, partnership, limited liability corporation (LLC), and corporation are the most popular company formations. A sole proprietorship is the simplest option if you are the only owner, but it does not give personal liability protection from your business's debts and responsibilities. As a result, many business owners prefer to create a limited liability company or corporation. Choose a Business Name When it comes to picking a business name, the best advice is to keep it short and simple, and make sure it accurately represents your company or product. If you're selling shoes, for example, a name like "Walking on Clouds" isn't a good idea, no matter how comfy your shoes are. People looking for your goods online will use the product name as a keyword, so be sure to include it in your company name. Companies like Nike and Red Bull can afford to spend millions of dollars branding their products; you can use your name to do the same. Register a Domain Name Your website is your store as an online business, and it, like a physical store, need a name so that consumers can discover it. A domain name is the name you give to your website. Your company name and domain name should, ideally, be the same. If the name you choose isn't already used, you may register it using a domain registrar like GoDaddy. If the business name you wish to use is already used, try adding the state or city where you are located or adding your name to make it distinctive. If you're a school or organization, your domain name will end in ".com," ".biz," or ".org." Because it is the most familiar, it is recommended to remain with ".com" for an internet business. Obtain an EIN The IRS website may help you get a federal tax identification number, often known as an Employer Identification Number (EIN), for your firm. While sole proprietorships and single-member LLCs aren't needed to have an EIN (as long as they don't have workers), it's generally a good idea for all firms to obtain one. You won't have to use your Social Security number this way, and most banks demand an EIN to create a business bank account. Check for Permits and Licenses Different sorts of companies require different permits and licenses in different states, counties, and localities. To find out what is necessary, contact the relevant agencies for your company location. See How to Get a Business License for information on business licensing requirements in all 50 states. You should also check to determine whether a fake business name is necessary for your company. You may want to consider purchasing business insurance depending on the nature of your internet business and the sort of business organization you pick. Trademarks, Patents, and Copyrights If you wish to protect a product, logo, creative creation, or other intellectual property, you should apply for a trademark, patent, or copyright. These safeguards provide you with legal protection in the event that you require it. You can file a trademark or patent application with the United States Patent and Trademark Office, or a copyright license with the United States Copyright Office. You may also use these offices to double-check that your logo, written work, invention, or other intellectual property isn't already held by someone else. You might be held accountable for damages if you infringe on an existing copyright or trademark, so it's a good idea to check before you start selling online. Conducting a search will assist you in avoiding potential legal problems such as selling t-shirts or other goods containing trademarked or copyrighted logos or photos without the owner's consent. Select a Platform for Your Online Business Choosing to build your own website gives you complete control over your company. However, development and maintenance expenses are considerable, and you'll almost certainly need to engage a team of specialists to set up and manage all of the necessary features. Shopify or BigCommerce, for example, are third-party platforms or marketplaces that perform a lot of the work for you. Most platforms enable you to establish a website on their platform or utilize their website to sell your products. Many provide templates for building a website as well as expert designers for a charge. The platform you select will be determined by your company's needs and budget. Compare the customer service supplied, security methods used, payment choices offered, and general services provided while determining what is ideal for you. Check out what platforms your rivals are using to ensure that the platform you pick meets the demands of your sector. The design of your website will be crucial to your success. PCI Compliance The credit card business requires Payment Card Industry (PCI) compliance. Not only must online companies provide safe payment alternatives, but they must also protect the client data they gather and retain. The PCI Standards Council establishes the standards and criteria that must be followed by your online business in order to be compliant. If you sell your items through a third party, these safeguards are almost certainly integrated into their platform. Third-party platforms, often known as SaaS-based ecommerce businesses, generally save all credit card data, reducing your responsibilities as a business owner. PCI compliance must be included into your system if you create your own website. Collecting Sales Tax Customers in the state where the firm is situated are no longer solely responsible for paying sales tax to online enterprises. Many states require internet companies selling to residents of their state to register with the state and collect sales taxes from their consumers. If you utilize a third-party platform, it is probable that the platform has sales tax obligations built into it. Yoel Molina, Esq. (AKA “Mo”) Feel free to join our WhatsApp group if you want to know more about his and more!
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Here's everything you need to know about turning your hobby into a lucrative business.
Whether you enjoy knitting hats or creating music, you never know when your passion will develop into a lucrative business endeavor. To be successful in business, you'll need to master a new set of skills. You will, however, be in the greatest position to introduce your goods or services to new clients if you do some study and preparation Establish Your Objectives Setting objectives will provide you direction and inspiration as you start and grow your new company. There are a few key questions to ask oneself in the early stages:
Having a clear objective in mind for how much money you hope to make from the enterprise, as well as how much time and effort you can devote to it, can aid in determining your next steps. Make a business strategy. Creating a business plan with your goals in mind can give you a roadmap for your company's next stages. First, conduct some research on the present state of your hobby's market, including what your rivals are doing. Examine your potential consumers to see what they require and where you might locate them. A thorough description of what your company will accomplish, including what services you will give, what items you will sell, your target audience, and how you will contact your consumers, should be included in your business plan. You may write a mission statement, which is a concise explanation of your company's aims and philosophy. Include details about your finances as well. Consider all potential startup and continuing costs, such as business registration, renting space, advertising, and maintaining an internet presence. Determine how you will pay for the startup costs, whether you will do it with your own money or with the assistance of investors or company loans. Estimate how much money you may anticipate to bring in over the following several months and years based on your study. Promote Your Products or Services Marketing is the process of marketing your company and determining how clients will discover you. To begin, inform your friends, family, and coworkers about your new venture. You can send a letter or postcard to all of your contacts to announce the endeavor, and be sure to promote it whenever you get the opportunity. Depending on your target clients, you may want to consider paid web commercials, print ads in your local newspaper, or radio adverts. You'll use the research you did for your company strategy to figure out how to reach out to your consumers. For example, if you're targeting adolescents, you'll have better results with social media advertising than with AM radio ads. Create a strong online presence For most firms, having an internet presence is a critical component of their marketing strategy. This includes building and maintaining a brand website as well as communicating with customers on social media. Consider sending a monthly email newsletter to consumers to keep them informed and engaged in your product or service. Connect with Customers and Mentors Networking is a phrase used to describe the process of forming new relationships, which can take place either online or in person. It helps you expand your knowledge base, discover mentors, and spread the word about the services or goods you provide. You may network with other professionals in your field, such as a wedding photographer who participates in online forums with other wedding planners or photographers. You can also participate in general professional gatherings, such as those hosted by your local Chamber of Commerce. Make sure you have a good explanation of your company and how it might benefit potential clients before attending your first networking event. Make time to write your "elevator speech," which is a short persuasive presentation intended to pique people's interest in what your company does. Bring plenty of business cards with your contact information printed on them. Get Your First Sale The first sale or client will be the most challenging step for most organizations. You may rely on your marketing and networking efforts here. Offering a free or reduced service is an efficient approach to attract new first-time clients. Remember that for every business with online reviews, the first few reviews may make or destroy the company. Make sure to provide the greatest possible experience for your initial clients, and then follow up to see how you can better fulfill their requirements in the future. Yoel Molina, Esq. (AKA “Mo”) Feel free to join our WhatsApp group if you want to know more about his and more! The renewal of contracts is subject to the nature and purpose of the business.
If you are looking to test the waters with a new client or vendor before making a long-term commitment, you may or may not want to have a contract renewal clause. On the other hand, if you are convinced of the capabilities of the involved parties and you are up for a long-term engagement, automated contract renewals will free you from the need to track dates on your calendar, let alone spare you from going through all the tedious paperwork. Keeping this as the core of thus article , we discuss below how to properly set up a business contract with an automated renewal clause. This article will help you understand the perks of auto-renewing while outlining ways to do it. . Evergreen Contracts: What does that mean and what are its advantages? “Evergreen Contracts” are contracts that get renewed automatically at a certain time or date if certain conditions are met . In other words, contracts that renew in the absence of legal notice on its own are termed as evergreen contracts. The clause that lies within such contracts is generally referred to as the evergreen clause. Here is an example - “This agreement is evergreen and shall be renewed every 24 months. If any of the parties decide to cancel the contract, it should be presented in writing by either of the parties, fifteen days prior to the upcoming renewal date". Moving ahead, we see the benefits of having an auto-renewal clause in your contract. The first and most important benefit of having an autorenewal clause is the predictability of its repeated need. Consider that the parties enter into an arrangement when one will ship products to the other. With auto-renewal contracts, both the parties have this assurance that they are working together until one purposely ends the agreement. Also, auto renewal contracts eliminate negotiations. Until the contract ends, it is renewed. It implies that neither of the parties would make amendments to the clause. One thing to note here is that a notice period should be included if one of the parties wishes to end the agreement. Without that, no party can break the clause. The best way to create auto-renewing contracts The most preferred way is to insert a clause on auto-renewal in your contract. Adding the clause The best way is to introduce the clause within the contract. The standard format of the auto-renewal clause is: This agreement shall have an initial term of two years from the effective date. Upon expiration of the initial term, this agreement shall automatically renew for a period of one year. Once you have added the clause, communicate the same to the other parties, and ensure effective onboarding. This will keep all of you on the same page, eliminating the possibility of disagreements in the future. Adding the clause further ensures that you are well aware of the presence of such a thing and that you abide by the legal obligations that come along with it. The key terms related to auto-renewing or evergreen contracts When creating a legal contract, with or without the auto-renewal clause, there are a few terms that you must know. Auto-renewal clause: A clause that signifies the contract renewal, if the contract is not closed by any of the parties in the duration mentioned for cancellation in this clause. Termination/cancellation: To purposely end the agreement. Open Period: The tenure of the agreement. Breach: Acting in a way different from what is agreed upon in the contract. Expiration: The day when the agreement ends and is due for renewal The above helps you better understand and find the clause. The Final Word Adding the auto-renewal clause within your contract is a decision you make when signing up for a deal. It is known that auto-renewal of contracts has its share of disadvantages and if the same is not emphasized, it would lead to a problem. Hence, it is important to first know whether you want such a clause. If yes, then you have to add all of the terms and conditions relevant to the same. Whether the contract renews with the same conditions or is it subject to negotiations, etc. Everything must be thought about and then etched in the legal contract. Failing the above, you might face legal action. Yoel Molina, Esq. (AKA “Mo”) Feel free to join our WhatsApp group if you want to know more about his and more! Despite the fact that business contracts can be very complex, the elements needed to make them enforceable and valid are in and of themselves fairly straightforward to understand. This might make you wonder about the pages of legalese you’ve seen in contracts from service providers and others in the past. The truth is this language won’t help you much when creating business contracts with third parties in order to build your business in a reliable and legally dependable way.
Instead, you want direct language that both parties clearly understand and that will be easy to assess in a dispute resolution situation like mediation, arbitration, or even formal legal proceedings (and can likely help you avoid these dangers). So accurate and detailed everyday language is actually a good thing if you hope to make your contracts enforceable and legally binding. Must a Contract Be in Writing? Most of the time, oral contracts are considered legally binding. However, there are a few exceptions in a few states, for example, if a contract is to last longer than a year it typically has to be in writing. The bottom line, however, is that you want something that is not only binding, but that is easy to enforce. Because of the often unclear nature of oral contracts, written contracts can provide incredible clarity and protection from dispute when compared to oral contracts and therefore it is highly recommended your business only use written contracts. What Is Required? In order to be binding and enforceable, all contracts need two things: 1. That the parties involved are in agreement. That is, that there is a clear offer made by one party and that the other party clearly accepts that offer within the terms of the contract. 2. There is an exchange between the two parties of something of value like goods, services, or money for one of the other in return. Typically, this is payment of cash for services or goods delivered. Let’s look at these two requirements in greater detail: Requirement #1: Agreement Between Parties The basic gist of the first requirement is that the clearer it is that all parties agree to all terms stated within the contract, the stronger it will be and easier to enforce. Reality is that things are not always so clearly black and white. Things get blurry. It’s not always so clear if everyone fully agreed to everything unless it’s explicitly stated that they do. Over time, much has been learned about issues where agreement isn’t so clear: Offer & amp; Acceptance To understand why this can be unclear, think of an example where you buy lunch. You walk up to a food cart and the vendor tells you the special is chicken for $5.99 with a side of potatoes. This would be his offer. If you tell him, “Sounds great, I’ll take it,” you’ve accepted the offer. If instead you tell him, “I think I want beef today,” you’ve rejected the offer. However, if you say, “I do like chicken, but I really want a salad instead of potatoes,” you’ve not accepted the offer, but have made a counter offer. This is where things can be a little unclear. When the discussion involves things more involved than what sandwich you are having for lunch, the stakes are higher and if there is a misunderstanding – someone has to pay for it. This is why making offer and acceptance clear is crucial to contracts. At What Point Acceptance Occurs The goal here is to determine as accurately as possible when acceptance does in fact occur as clear in the contract as possible. However, even when this is done, a party may want time to think about an offer. In the interim, the other party may reconsider and wish to change specific terms so that disputes can arise. To minimize the chances for this, certain rules should be followed concerning how long an offer should remain open, how you should revoke an offer,what sort of expiration date you may want to include, as well as how to handle counter offers. How Long Does an Offer Remain Open? The issue you run into is that without stating specifically in the contract how long the offer isvalid, it is legally considered open for a “reasonable” amount of time. This is clearly open to interpretation and can be the source of a dispute that could simply be removed by including an expiration date within the contract itself. This leaves no room for doubt. If you are on the other side of the contract and considering an offer without an expiration date stipulated, it’s in your best interest to accept it as soon as possible if you want to go through with it before they want to change the offer. Until you accept it, it can be revoked at any time. Revoking an Offer The party making the offer has the right to revoke it at any time before it’s been accepted. The Only exception to this is if they agree to leave it open for a specific amount of time. In this case,they must abide by these terms in order to avoid dispute. Since making a counteroffer does not constitute as acceptance, the party making the offer may still revoke the original offer if you respond with a counteroffer – they are not obliged to keep the original on the table. Offer Expiration Dates When a contract has an expiration date, or an option, this typically comes with a fee. A typical option is a 30-day option where the seller (an option is typically used in the exchange of goods for cash) agrees to not offer the product or goods to anyone else for 30-days while the buyer considers the offer. Regardless of whether or not a seller charges for the inclusion of an expiration or option in the contract, they are obliged to follow them. Counteroffers Counteroffers are an integral part of the negotiation process and are simply an offer made by one party against the other party’s offer. For example, a seller offers you chicken and potatoes for $5.99 and you counter offer by asking for chicken and salad for $5.99. Typically, if the party agrees to the counteroffer, acceptance happens at that point. It’s important to note that inconsequential differences cannot be used to void a contract where a counteroffer was accepted. In our example of the lunch special, if the food vendor agreed to provide salad instead of potatoes and it turned out the salad wasn’t as big as the side of potatoes, they wouldn’t owe you the difference in potatoes. Exchanging Something of Value The second major component of any contract besides the offer and acceptance is the actual exchange of value. That is, if you expect the terms of your contract to be legally valid, there must truly be a give and take – both parties must give something of value to the other. Defining the Thing of Value, or “Consideration” to Be Exchanged Legally speaking, whatever is to be exchanged of value between parties in a contract is called the “consideration.” In most cases, the consideration is a promise to render future services, or deliver goods or payment. For example, the promise to deliver a daily special with chicken and a salad in exchange for the promise to pay $5.99. A Contract Vs. A Gift If one party is simply doing something for the other or giving them something, they are under no legal obligation to follow through on their agreement to do so. For example, if someone promises to bring a pie to your party as a favor but instead shows up with a punch because the store was out of pie, you have no legal recourse to attempt to hold them to their original promise to bring pie. On the other hand, if there had been an agreement where both parties agreed to provide pie for events for each other, a contract would exist, and legal recourse would be available. Promises vs. Action There are a few situations where the consideration is met by actions instead of actual promises to perform them. For example, if you asked the food vendor for salad and instead of saying anything, they just gave you the chicken with salad – this would constitute agreement and that a contract was made. Legally, you wouldn’t be able to say, “I changed my mind, you should have double-checked first,” and be freed from the original verbal contract you had already entered into. Yoel Molina, Esq. (AKA “Mo”) Feel free to join our WhatsApp group if you want to know more about his and more! Getting Started as an Independent Contractor
Owning your own business and working as an independent contractor is a great alternative for some professionals. However, many don’t realize that freelancers are subject to several laws about how they must conduct business and therefore end up putting their business at risk. This is easy to do because often independent contractors don’t realize that some part time work will suddenly become their career and so they don’t think to plan adequately. Though it makes sense why this might happen, the fact of the matter is whenever you render a service to someone and receive payment, there are several government rules you must comply with. This is true if your position is a full career or never becomes more than something you do for a few hours each week. There are three things that independent contractors must do to ensure they are running a legitimate and legal business: 1. Name and register their business. (Registering it is only required in some states) 2. Register for a Vocational License (if needed) and Tax Certificate 3. Make sure to pay your estimated taxes throughout the year Naming Your Business There are several advantages to naming your business something other than your personal name. Namely it makes your business appear far more professional and therefore makes it easier to win client’s trust. However, when you choose a name, you need to register it. Any business that doesn’t use the actual legal name of the owner is required to register what is called a “fictitious business name.” This is true even if your business name uses part of your real name. Without registering your business name with the government, you may be unable to enforce any contracts you make under that name, nor will banks open an account for your business without its name having the proper registration. Of course, using your full legal name does mean you do not have to register your business name. If your business is small enough, this might be just what you want to do. If this is the situation you are in, starting out this way might be best. Registering a Fictitious Business Name This is typically done at the county clerk’s office in most states, but in Florida, you register your fictitious business name with the State Department. Check with a qualified business attorney in your area if you are unsure where to file your fictitious business name. Registering Your Tax Certificate Depending on the city and county you live in, your business may be required to register for a tax certificate. In some cities and counties this is referred to as a business license, but this is simply a tax for the privilege of doing business within the city. All independent contractors need to file for a Tax Registration Certificate even if they work out of their home. There are stiff penalties for failing to file that are far more expensive than registering, so it’s in your best interest to ensure you comply with local tax obligations before you incur expenses. Do You Need a Vocational License? Depending on the type of business you run, you may also need a vocational license to run a legal business. You may need to be licensed as a mechanic, contractor, therapist, etc. in order to legally provide such services and charge clients for them. If you are unsure, speak to a qualified and knowledgeable business attorney in your area. Self-Employment & Estimated Income Taxes If you are an independent contractor, no one holds anything out of your paycheck for medical insurance, social security, or tax obligations. This responsibility falls on the independent contractor. Setting aside the money to pay for the tax obligation each year is required of any independent contractor who makes at least $400* a year. The IRS also requires “estimated” tax payments throughout the year for contractors who make more than $3,000 annually.* One way to avoid having to do this if you are employed elsewhere is to have additional taxes held out of your paycheck there to compensate for the estimated tax obligations. Though it might appear tempting to not file and pay taxes, anyone who pays you more than $600 a year will be required to report it, so hiding from the IRS isn’t easy to do and it can jeopardize your business’s long-term viability. Yes, self-employment taxes are quite high, but not near as high as fees if you fail to meet your tax obligations. Registering with the IRS The best thing to do is to register as self-employed tax payer by (1) Filing the 1040-ES for your estimated tax obligations and (2) a Schedule C & Schedule SE at the end of the year with your 1040. These are all available from the IRS’s website. Yoel Molina, Esq. (AKA “Mo”) Feel free to join our WhatsApp group if you want to know more about his and more! 15/10/2021 0 Comments How to make Successfully Make An OfferWhat Constitutes an Offer?
One particular thing about business contract law is that there must be an agreement based upon an offer and acceptance for the contract hold. What’s more, there must be some exchange of value between the two parties using the contract to make it valid. Thus, a contract is an agreement to exchange values between the party making an offer, or the offeror, and the party to whom such offer is made, or the offeree. Let’s look a little bit closer at the offer part of a contract to see if we can add a little clarity to the topic. A Contract’s Purpose There are all kinds of contracts (lease, sale of goods, promise to render services). They each have a specific purpose in mind, which is expressed in the offer. So if the purpose of your contract was to secure the services of a painter to repaint your business office, an offer would have to be made and accepted. Now the question is, what are the terms of the offer? Thus, contracts need to include terms of agreement. A Contract’s Terms of Agreement The important thing here is that there is enough detail to make the offer and obligations it presents clear. This typically means that such terms must include some kind of material terms such as the price, type of services or goods, timeframe, and other key terms. Depending on the nature of the contract, terms may include a great many other things. Valuable Considerations What’s more, a contract offer must have a consideration to hold. If you were to offer the painter $10,000 extra dollars when they finished on top of the amount you already agreed to pay in the contract, you couldn’t be contractually obligated to pay that extra without any consideration. However, if you agreed to pay the extra $10,000 if the painter finished two weeks early and this was added to the contract, it would hold because of the valuable consideration of the expedited turnaround time. A Party’s Capacity to Accept Another legal consideration to an offer in a contract is what is known legally as “capacity.” That is, the person signing the contract must have legal authority over that which they sign for it to hold. This means that not just anyone can sign a contract for a company, but someone with the authority to do so. Yoel Molina, Esq. (AKA “Mo”) Feel free to join our WhatsApp group if you want to know more about his and more! As anyone who owns a business knows – contracts are an indispensable tool to get things done and protect your business interests. However, if you don’t know anything about the laws that govern contracts, you may be doing more harm than good when you put pen to paper. Let’s talk through some of the basics of contracts and the law to make sure you have a good understanding of what’s at stake.
What Is a Contract? This is basically a legally-enforceable agreement between parties (two or more) that obligates both parties to fulfill particular things as specified within the contract. By party, this can mean a person, country, company, corporation, etc. What you want to keep in mind is that two things are always implied when the word contract is used: ●That there is an agreement made (something for something) ● The agreement is legally enforceable What Laws Pertain to Contracts? One thing about contracts is that the laws that govern them are determined by the state where the agreement between the parties was made. There may actually be a couple of types of state laws that govern the contract as well – depending on what type it is (e.g. property lease, sale of goods). For example, these are two types of law: 1. The Uniform Commercial Code or UCC: These laws govern contracts used for the sale of goods. The UCC is a standardized set of guidelines that oversee commercial transactions. While the code is not law itself, most states have adopted all or part of the code as law. 2. The Common Law: Other business contracts may be governed at least in part by “common law.” This includes all contracts like employment contracts, leases, etc. Each state has their own common law made from court decisions within the state over the years. How is a Contract Created? Any time an offer is made and accepted after a sufficient amount of “consideration,” a contract is legally valid. Let’s examine what these terms mean in the context of contracts: 1. An Offer: the terms of this offer must be clear and certain, and the party to whom such an offer is made must reasonably expect the offering party capable of the offer. 2. Acceptance: This is a clear expression from the party receiving the offer that they accept its terms and agree to it. 3. Consideration: There must be some gained and something obligated for all parties involved for the contract to hold. There must be an exchange of some kind of value. What Happens when a Contract is “Breached?” Anytime a dispute arises over a contract, one party may feel another party is failing to adhere to the terms of the contract they are obligated to adhere to. This is considered a breach and can result in legal action by the non-breaching party in an attempt to remedy the situation, which can happen in a number of different ways depending on the type of contract and breach. How Are Contracts Enforceable Under the Law? In the event that there is a breach of contract, the most common way to attempt to remedy the situation is to use a lawsuit through the court system.. However, there are other options for dispute resolution before turning to out-and-out litigation. These alternatives are mediation and arbitration. Yoel Molina, Esq. (AKA “Mo”) Feel free to join our WhatsApp group if you want to know more about his and more! Learn about the pros and cons of hiring an independent contractor versus an employee.
Hiring an independent contractor (IC) has many advantages, but also some disadvantages. Before deciding how to staff a particular position, you will need to weigh the pros and cons and ensure that your selection will be accepted by state and federal auditors Benefits of Using Independent Contractors There are some big advantages to using independent contractors instead of employees, with financial savings at the top of the list. You will probably save money. While most employers pay CI per hour more than they would pay employees to do the same job, it often costs employers more to hire employees. When you hire an employee, you'll have to pay a number of costs that you don't have to pay credit unions, including employer-provided benefits, office space, and equipment. You will also need to make the necessary payments and contributions on behalf of your employees, including:
All together, these expenses can easily increase your payroll costs by 20% to 30% -- or more. You have flexible employees. Working with CIs allows employers more flexibility in hiring and firing workers, which can be especially beneficial for employers with fluctuating workloads. You can hire a microchip for a specific task or project, knowing that workers will be gone when the job is done. You won't have to deal with the potential injuries, costs, and legal issues that can come with layoffs and layoffs. You can also enjoy greater efficiency when using integrated circuits. Since most credit institutions bring specialized expertise to the job, they are often productive immediately, eliminating training time and costs. You reduce your exposure to lawsuits. Workers have many rights under state and federal law, so there are many legal claims they can bring against their employers for violating these rights. Because credit unions are independent traders, they are not protected by many of these laws. Among the rights available to employees but not to credit institutions are:
Employees can also sue their employer for unfair dismissal. ICs cannot bring this type of lawsuit Disadvantages of Using Independent Contractors After reading through the possible benefits of hiring a CI, you might think that you will never hire an employee again. But there are also significant limitations to the use of integrated circuits, and the risk is that your classification decision will be questioned by government agencies. You have less control over your workers. Unlike employees, whom you can supervise and keep a close eye on, independent contractors have a certain degree of autonomy in deciding how best to complete the task you have hired them to do. . If you interfere too much with an IC's work, you run the risk of making the IC look like an employee, who by law requires you to pay payroll taxes, workers' compensation insurance premiums, etc. If you want to have significant control over what and how your employees do it, categorize them as employees. Your workers come and go. Many employers only use CI when necessary for relatively short-term projects. This means workers are constantly coming and going, which can be frustrating and disruptive. And the quality of work you get from different integrated circuits can be very evident. Employers who want to rely on the same workers day in and day out are more interested in hiring employees than credit institutions. Your right to terminate your IC is subject to your written agreement. You don't have unlimited rights to enable ICs, like you can with your employees. Your right to terminate IC's services is limited by the terms of your written IC agreement. If you fire an IC in breach of the agreement, you may be liable for the breach of contract. You may be liable for injuries caused by CI on the job. Employees injured on the job are usually covered by workers' compensation insurance. In exchange for the benefits they receive for their injury, these employees waive their right to sue their employer for damages. Credit unions do not compensate workers, which means that if they are injured on the job, they can sue you and pay damages. You cannot own copyright to works created by IC. If you hire an IC to create a copyrightable work, such as an article, book or photograph, you may not be considered the owner of the work unless you use a written agreement to transfer ownership of the copyright from the IC to you. On the other hand, if an employee creates a work like this. So in most cases you automatically own the copyright. You are at risk with government audits. Federal and state agencies, especially the IRS, want to see as many workers as possible classified as employees, not ICs. The reason is financial: the more workers are classified as employees, the more tax and insurance money flows into government coffers, and the harder it is for workers to report or hide their income. them with the tax authorities. Some state and federal agencies may inspect your business if they believe you have misclassified an employee as a CI. At the federal level, you may face an audit from the IRS; The Department of Labor, which enforces federal minimum wage and hourly laws; The National Labor Relations Board, which advocates for workers' rights to form unions; or the Occupational Safety and Health Administration, a workplace safety law enforcement agency. At the state level, you may be able to bring to the attention of your state unemployment compensation or workers' compensation agency if a worker you have classified as an IC is claiming benefits. You may also face an examination from your state's tax office. Yoel Molina, Esq. (AKA “Mo”) Feel free to join our WhatsApp group if you want to know more about his and more! If you're hiring your first employee, you'll need to file paperwork with various government agencies and pay taxes to them.
Congratulations on hiring your first employee! It's critical to get off to a good start as an employer by making sure you follow all of the new legal requirements. Being an employer comes with a slew of new responsibilities, ranging from tax forms to government registrations to insurance requirements and beyond. Our to-do list for new employers can be found below. 1. Obtain a tax identification number for your company. When you hire employees, you must obtain an employer identification number (EIN) that you can use on your tax returns and other IRS documents. To obtain an EIN, fill out IRS Form SS-4. The IRS website, www.irs.gov, has the form available for download. 2. Register with the labor department in your state. You'll have to pay state unemployment compensation taxes once you hire employees. These funds go to your state's unemployment compensation fund, which helps workers who have lost their jobs in the short term. A list of state unemployment insurance tax agencies can be found on the Department of Labor's website. 3. Get workers' compensation insurance. Workers' compensation insurance should be in place to protect employees from on-the-job injuries. The vast majority of states require workers' compensation insurance, though some make exceptions for very small businesses. 4. Set up a payroll system to withhold taxes. You need to withhold and submit a portion of each employee's income to the IRS, and pay social security and health insurance taxes to the IRS. For more information, see IRS Publication 15, Circular E, Tax Guide for Employers on the IRS website www.irs.gov. (You may also need to withhold taxes for your state. For more information, please contact your state tax authority; for links to each state authority, please visit the Association of Tax Administrators website www.taxadmin.org /State tax authority.) 5. Have each employee fill out IRS Form W-4, Withholding Allowance Certificate. Employees will use Form W4 to tell you how many allowances they have applied for for tax purposes so that you can deduct the correct tax from their salary. (You do not need to submit a form to the IRS.) This form can be found at www.irs.gov. If an employee wants to change the allowance, you should ask the employee to fill out a new W4 form every year. 6. Fill out Form I-9, Employment Eligibility Verification for each new employee. The United States Citizenship and Immigration Services (USCIS, formerly known as INS) requires employers to use this form to verify whether any employees they hire are eligible to work in the United States. (You do not need to submit this form to USCIS, but you must keep it on file for three years and provide it to immigration and customs officials called ICE for review.) You can obtain this form online at www.uscis.gov. Please note that these are completed The form should be stored in a separate I9 folder for all employees, not in each employee’s personnel file. 7. Report each new employee to your state's new hire reporting agency. The New Employee Reporting Program requires employers to report information on all new employees for the purpose of identifying parents who owe child support. Each state has a different new hire review agency. To find the name and address of your state's new hire reporting agency, see the New Hiring State page on the Children and Families Administration website (www.acf.hhs.gov). 8. Post required notices. Some government agencies require employers to publish notices of workers' rights to their employees. For more information on federally required posters, see the Department of Labor website at www.dol.gov/elaws/posters.htm. DOL's "Poster Advisor" will help you determine which posters to display in your workplace. In addition, you must comply with your state's department of labor poster requirements. A list of state labor departments is included on the website of the Federal Department of Labor 9. File IRS Form 940 each year. You must complete IRS Form 940 to report your federal unemployment taxes for any year you paid $1,500 or more in a quarter or for any year an employee worked for you. for 20 or more weeks of the year. You can find the form at www.irs.gov 10. Adopt workplace safety measures. Virtually all employers must comply with the requirements of the Occupational Safety and Health Act (OSHA) by providing, among other things, a hazard-free workplace, training employees to do their jobs safely, notify government administrators of serious workplace accidents, and keep details of safety records. For more information on these rules, see the Occupational Safety and Health Administration's website at www.osha.gov 11. Create an employee handbook. Although not required, it is best to have a manual outlining your company’s employee policies and clearly stating that employment is free, unless the employee has signed a written employment contract. 12. Set up personnel files. For each employee you hire, create a file to save work-related documents, such as application forms, job vacancies, IRS Form W4, performance evaluation, and employee benefit registration forms. Medical records should be kept in a separate confidential file and kept in a locked cabinet. The I9 form that records the employee's immigration status should also be kept in a separate file. 13. Set up employee benefits. If your company has an employee benefit plan, such as health insurance or a 401(k) plan, you will need a registration process so that employees can register, name their dependents, and select options. Yoel Molina, Esq. (AKA “Mo”) Feel free to join our WhatsApp group if you want to know more about his and more! Owning and managing a home company has never been easier thanks to modern technologies. To contact consumers, all you need is a mobile phone and a laptop. But there are a few things you should know before you put up your sign and start promoting
Advantages of a Home Business A home-based business is both easy and cost-effective. The costs of starting a conventional brick and mortar firm are significantly lower. You don't have to worry about paying rent, utilities, or commute costs. Low overhead implies less risk and greater profit potential. Home companies also provide independence and flexibility to its proprietors. You may work on your business in your jammies during your leisure time. Running a home company also has tax advantages. Choosing the Right Business The possibilities for a home company are virtually limitless. A few suggestions are photography, dog walking, house painting, and home décor. A virtual assistant, graphic designer, or social media professional are all options. Consider your passions and hobbies. What do you excel at? What do you like to do in your spare time? What is the most common topic on which individuals seek your advice? The answers to these questions may be able to assist you in making the appropriate decision. Many people work as associates or consultants for a well-established firm. This "company in a box" option assists novice entrepreneurs with marketing and communications. You'll also get the opportunity to work with seasoned mentors. Picking a Business Structure After you've decided on a business name, you'll need to decide on a business structure. Sole proprietorships, limited liability companies (LLCs), and S corporations are the most common types of home enterprises. You can create a partnership if you have two or more owners. For many company owners, a single proprietorship is the most convenient choice. A sole proprietorship, on the other hand, does not provide personal liability protection against your business's debts and other responsibilities. Instead, if your company has the potential for legal liability, you should consider forming an LLC. Make sure you do your homework on the many business entity options and which one is ideal for you. Securing a Business License Location-specific licensing and permission restrictions apply. Visit the Small Business Administration for a list of state-specific regulations. Home companies, in general, require a business license from the local government. The needed license can be obtained through your city's business or tax department. You should also look at zoning laws. Operating a company from your house may be prohibited by homeowner's associations or zoning regulations. You might be able to acquire a variance if this is the case. Before you open, make sure you have the permissions you need. Health & Safety Permits Additional licenses may be required for some enterprises. A fire permit may be required if you welcome consumers into your house or keep hazardous merchandise. Food and personal care product manufacturers and sellers are frequently subjected to health inspections. It's possible that you'll need to obtain a health or environmental permit. For additional information, contact your local business office. Professional and Sales Tax Licenses Professional certification is also required in businesses such as hairdressers, legal and financial advisers, and home childcare services. For a comprehensive list of businesses that require professional license, go to your state's business website. A sales tax license may be required if you offer goods or services. This is sometimes included with the business license, and other times it is a distinct document. Insurance Considerations Your business is not covered by your homeowner's insurance. If you run a company out of your house, your insurance coverage may be voided. Notifying your homeowner's insurance carrier about your business venture is a smart idea. To safeguard against business losses, you should get business insurance. General liability insurance is required by all enterprises. Property damage, inventory and product damage, and personal injury coverage are all available. Data breach insurance is required for every company that stores sensitive information online. In the event of a calamity, business interruption insurance replaces revenue. Make careful to read the tiny print to understand what the policy does not cover. Bookkeeping and Accounting Keep track of your company's revenue and expenditures. You may use a basic Excel spreadsheet or accounting software to track all of the money coming in and out of your firm, but you must keep track of it all. To keep your personal and company funds distinct, open a separate banking account for your business. It's also a good idea to get a separate credit card for your business. To keep track of your finances, make copies of all receipts and income statements. Make sure you're on top of your documentation. Set aside one day every week to focus on invoicing, bill payment, and record keeping. Taxes You are self-employed when you run a home business. Taxes, including Social Security and Medicare, are your responsibility. The IRS usually requires you to make estimated quarterly payments. Tax Deductions All home business owners may deduct ordinary and necessary business expenses. These include:
The Home Office Deduction You could be eligible for a home office deduction. This deduction is only applicable to spaces that are only utilized for business. You cannot claim the deduction if you work from your bedroom or kitchen. The storage of merchandise and samples, as well as home daycares, are the only exceptions. You can deduct a percentage of your homeowner's insurance, homeowners' association fees, cleaning fees, mortgage and interest, and utilities under the home office deduction. Home repair expenditures can also be deducted, however the amount depends on whether the repairs are direct or indirect. Yoel Molina, Esq. (AKA “Mo”) Feel free to join our WhatsApp group if you want to know more about his and more! |
AuthorYoel “Mo” Molina, I am a lifelong resident of Miami, Fl. I am a graduate of Miami Senior High, Class of 1992, Georgia Institute of Technology, B.S. 1997 and University of Maine School of Law, J.D. 2001. I have been practicing law in Miami Since 2001. I am a former training prosecutor in the Miami-Dade State Attorney’s Office. I have experience in jury trials, appeals, and administrative hearings. I have appeared before judges across the State. My experience ranges from civil litigation matters, collection matters, foreclosure, business and corporate, contracts, real estate, leases and employment matters.. Archives
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"Mr. Molina has always been there for us with timely, reliable and competent advice. He is an important and valuable part of our team." Corporate Client Eric Delgado, President of American International Export, Inc., a worldwide importer and exporter of brand name appliance parts. |
"Yoel has been responsive and attentive to our company’s best interests and needs. He has been a valuable resource to our company. Any company that enlists his services would be in good hands-- including our own clients.” Corporate Client Gibran Flynn - Co-Owner and Founder of Eleva Solutions, Inc., the South Florida leader of outsourced HR, Staffing, Training, and Loss Prevention. |
"My name is Anastasia Yecke Gude and I am the owner of Healing Hands Therapeutic Massage LLC. In the process of my company’s growth and expansion, I suddenly found myself a few weeks ago in need of a 1099 contractor agreement, and I needed it ASAP. As in, the very next day! I contacted the Law Office of Yoel Molina and his assistant put me in touch with Mo. I sent him what I had drafted up and he replied within a few hours with suggested revisions and clarifications, as well as a few insights I had not even considered. I was thoroughly impressed by the quality of work he provided, especially considering the time crunch I put him in (sorry, Mo!). I definitely recommend his services to anyone in need of a good contract attorney, and I will be calling him again for future work…hopefully in less of a rush next time!"
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