# Legal Steps To Starting A T-Shirt Business



## POapparel (Jan 15, 2014)

Hey all,

I just want a simple step by step reply of how to get the proper legal stuff for my clothing line. I have some basic questions to guide your responses:

1) Do I need to trademark my logo and name or just my logo?
2) Do I need to register as a LLC?
3) Do I need a state and federal tax ID number?

Please help me with these steps. I just want to legally do things right!


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## kimura-mma (Jul 26, 2008)

POapparel said:


> Do I need to trademark my logo and name or just my logo?


It is not legally required to trademark anything to launch a clothing line. It is completely optional. So you can trademark the name, the logo, both or neither. If you do choose to trademark both, they would require separate trademark applications and fees.



POapparel said:


> Do I need to register as a LLC?


You can register as a DBA, LLC or Corp. All have their own pros and cons. If you Google "starting a business in (your state)," you will find plenty of resources with good info on this. Or better yet, consult a local accountant who can help you through the process and figure out which is best for you.



POapparel said:


> Do I need a state and federal tax ID number?


It's a good idea to get one. It will help with reporting sales tax and opening wholesale accounts with suppliers.


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## binki (Jul 16, 2006)

You don't need any of that if you want to try it out. Your supplies might cost a little more but at least you won't waste time and money on something you can do later


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## POapparel (Jan 15, 2014)

I have my equipment and supplies already.i originally had a middleman making my shirts entirely but now I'm pressing them myself and I have my own website. It's Been growing, as far as business, and I'm starting to take it more seriously now


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## binki (Jul 16, 2006)

Ok, so you can do an LLC but a C Corp has more advantages. Check out. 
Ker$tetter Letter®
Tax Guru – Ker$tetter Letter


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## POapparel (Jan 15, 2014)

kimura-mma said:


> It is not legally required to trademark anything to launch a clothing line. It is completely optional. So you can trademark the name, the logo, both or neither. If you do choose to trademark both, they would require separate trademark applications and fees.
> 
> 
> You can register as a DBA, LLC or Corp. All have their own pros and cons. If you Google "starting a business in (your state)," you will find plenty of resources with good info on this. Or better yet, consult a local accountant who can help you through the process and figure out which is best for you.
> ...


So I need both a state and federal tax id?


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## POapparel (Jan 15, 2014)

Should I do a sole proprietor or LLC. I'm the only one who makes my own shirts and I want the least amount of tax regulations as possible


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## kimura-mma (Jul 26, 2008)

POapparel said:


> So I need both a state and federal tax id?


Federal.

On the state level, you may need a resellers license. These vary by state. You would need to research your state to see what you need to legally operate your business.


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## mgparrish (Jul 9, 2005)

POapparel said:


> So I need both a state and federal tax id?


State level there are both retail sales tax and income reporting.

Federal concerns are for income profit/loss reporting and not retail sales tax.

There could also be local county or city tax for retail sales tax in addition to state retail taxes, depends on where you are. DBA's, reseller/retail licenses, etc are state specific.

As far as how you structure for income tax reporting it's hard for anyone to really tell you what is best for you. Whether you report income as a corp, LLC, or individual depends on your unique situation. You really need to speak with an accountant on that aspect.


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## mgparrish (Jul 9, 2005)

binki said:


> You don't need any of that if you want to try it out. Your supplies might cost a little more but at least you won't waste time and money on something you can do later


If you are only doing as hobby or craft with no sales then yes, if you _sell items and make money or you are required to collect retail tax on your sales_ that is not correct.

If "trying it out" means giving a few things away or making stuff for yourself that would be OK.

It is also possible to operate your startup as "hobby" and deduct expenses and some equipment as a loss, for a while. So even "trying it out" it may be beneficial to go those legal steps.

http://www.irs.gov/uac/Is-Your-Hobby-a-For-Profit-Endeavor?


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## isbj (Oct 21, 2013)

POapparel said:


> 1) Do I need to trademark my logo and name or just my logo?
> 2) Do I need to register as a LLC?
> 3) Do I need a state and federal tax ID number?


1) As one poster already stated you don't have to trademark

2) You don't need an LLC. 

3) You most likely need some kind of seller's permit or sales tax license depending on your state. You only need a federal tax id if you have employees, have a partnership, or using a DBA.

If you are doing business in your own name that is the name of your business, and your ssn would be all you need. If you're doing business as (DBA) Best Damn Shirts or whatever then you would need to register a DBA and file for Federal tax id. 

Basically all you need is to find out how to register to collect sales tax in your state (seller's permit), it's usually free. Then you would need a business license, usually administered by city or county. This is as long as you are doing business in your own name. Whenever you report your sales tax, or your income from your business you will use your legal name and ssn.


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## mgparrish (Jul 9, 2005)

isbj said:


> 1) As one poster already stated you don't have to trademark
> 
> 2) You don't need an LLC.
> 
> ...


Some states, such as the one I live in AZ do not require a registered DBA to operate under a "fictitious" business name.

DBA's are permitted, however, they are only optional in my State, other states have this as well.

What are the requirements for recording a business name? | Yavapai County Recorder's Office

In other words I am still "Doing Business As" it's just I don't have to register my Doing Business Name, nor do I need a special Fed tax ID EIN number under my "fictitious" business name. I file as an individual and use my SSN and I am "Doing Business As".


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