# Starting out and need help with licensing etc.



## stickkerr (Nov 15, 2007)

ok - i've been reading for days now and have found so much information but i still can't quite sort out what i need.. here is my situation. a friend and i have started a partnership... we are buying wholesale and having a local company screenprint for us.... we are selling to retail stores in and out of state (alabama). so i'm trying to figure out what i need to cover all my bases. here are my questions:
1- we are selling in and out of state so we won't be charging sales tax, right????
2-i know we need a business license, but do we also need a fed tax id if we dont have any employees?
3- still confused about what a resellers license is - do we need one for what we are doing? 
2 - When we sell to a retailer - what info do we need to require from them?


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## redcell1 (Nov 15, 2007)

Well As I know (Im not a lawyer so this wont subsuite) but they charge for other state taxes for example If I buy a shirt from you you would charge taxes in my state.

Well if you pay yourself you still need a fed tax id because you make profit.

For a retailer you should know what market they attract, a bit of background about them and what can they do for you.


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## stickkerr (Nov 15, 2007)

as far as the retailer i sell to... i meant - do i need to know their tax id # or something like that so that when i file - i can report who i sold to and who should be collecting sales tax on the items i sold?


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## peteVA (Nov 11, 2007)

1- we are selling in and out of state so we won't be charging sales tax, right????

WRONG - You will need a sales tax account if you are in a state with sales taxes. You should collect sales tax on all sales DELIVERED in your state, except to wholesale customers who supply an exemption certificat - more later). It does not matter where the sale originates, it could be from Russia. If the goods are delivered in your state you should collect sales tax.

2-i know we need a business license, but do we also need a fed tax id if we dont have any employees?

Actually. sole proprietorships and partnerships do not actually "pay themselves", they make "withdrawals" from the business which they include in their personal income on their 1040's at the end of the year. 

There are different rules for this, and they should make voluntary quarterly "estimated deposits" that would be similar to withholding. They should also make contributions to Social Security.

3- still confused about what a resellers license is - do we need one for what we are doing? 

The term "reseller's license" can mena many things. It might refer to your sales tax account number from the state or it might refer to a business license from either your state (a few and it's different that the tax number) or your local city, town, etc. Usually business licenses are local.

2 - When we sell to a retailer - what info do we need to require from them?

In order for you to NOT charge them sales tax, they should supply you with a signed "exemption form" (it may have a different name) that says they will collect the sales taxes and don't have to pay them to you. Be sure and get one of these from all retailers you sell and keep them on file. If you cannont produce when when audited by the state YOU will be liable for the taxes you did not collect.

For more on this and a link to your state's sales tax site go here - Small Business FAQ
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## karlking85 (Sep 26, 2007)

Don't forget you also have to provide a 1099 Form for any non-corporate vendors you have paid in excess of $600.00 for the year. For this, you will have to obtain their federal tax id number, which you should have received already anyways, for sales tax purposes.


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## peteVA (Nov 11, 2007)

I believe the responsibility for that is the vendors. It doesn't matter if they are corporations or not. If YOU spend over $ 600 with THEM, it is up to THEM to make the report.

In general, they will contact you with a blank form for you to sign and return a Form W-9 to give them your information. 

As matter of fact, I've got one right now on my disk, emailed from an affiliate service for me to fill out.

They will then mail you a 1099 if you have purchased more than $ 600 for you to keep on file.
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