Well, my wife and I decided to make the move to set up a small business to make a few dollars extra each month. Being the law-abiding citizens we are, and being somewhat a stickler myself for being that way, [and according to my wife, I'm like that in almost everything else, I think she calls that anal-something
], we decided to go ahead and set the business up by going through all of the registration requirements from the city on up to the federal government. You know, set everything up legally and proper.
Well, having called up the State, I verified the name we wanted to use was not yet being used and I was told to go ahead and submit out paperwork for a LLC. So, I got online, filled out their online forms, paid, and proudly sat back thinking we were on our way. Oh, should have known.
The instructions said that I needed to do the next step, fill out a Master Business Application, again, being able to do that online as well. So I went ahead and did that too, paid, and a little more tentatively, sat back thinking I had accomplished even more. The instructions said I needed to do this step in order to get a Unified Business ID (a UBI) which would cover us for State taxes, help us open a banking account, and other legal stuff, and make us really official looking. [Well, the last part I threw in there.]
Then went and called the IRS and a less than friendly lady asked some questions, and then gave me a Federal Tax Identification Number (FTIN). Now, I am really feeling official.
This all happened earlier this week. Since the online instructions for the registration said they would expedite the filing after they charged me the expedited fee, and the Master Application instructions said they would have their stuff done in 2 business days, today I called the office for the Master Application first. Hold time was only about 4 minutes for someone to answer. And I was told what my UBI number was. And then I was told it might not be the right one because the other office still had not registered our filing stuff yet. “Please call them because they might have issued a UBI number and we have to use theirs.” So I called the filing office.
The hold time was 17 minutes. She asked me for the filing number and then told me that they were working on stuff from 7 days ago, and no UBI number. So much for expedited work.
But wait a minute. So I can get a UBI number from either office, but one of them is not necessarily good. Hmmm..I’m looking less studly now.
Okay, I sorta understand, it’s the government. Then I went to check on our operating agreement to make sure everything was the way we wanted. The IRS says because it is only me and my wife doing the business, we can be considered as a sole-owner LLC and need 2 FTIN but the lady on the phone said no. To file taxes, we may be considered as partners. And to pay taxes, we may be taxed as a corporation.
And oh yes, by the way, even though I was able to file the Master Application online which also covered the city where I live because I have to get a license from them also, I still have to bring paperwork back to them as well in order to get the license. Even though it is the same stuff I filed online and paid already. But they added a requirement to provide a copy of my floor plan for my house since this is a home-based business.
And the operating agreement? Well, the State says I don’t need one. The IRS just wants to see one, whenever they ask, just to show we are actually doing some kind of business. Course, it doesn’t have to be signed…..huh?
Just trying to make sure the little bit of money we plan on making is properly reported and the required taxes paid. But I can tell you right now, with all of the conflicts of information, the different sources you have to go through, the different stacks of paperwork you have to wade through, and the misinformation, I fully understand why some people just get paid “under the table”. If I was paid for the time I have spent so far, well, with that rate of pay, I wouldn’t need the business.
Oh yeah, still waiting on everything. It still hasn’t been filed, registered or fixed yet. And I almost feel neutered….


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