The PM Business – Tax Tips – Part 1

Attend every “new business” or “startup workshop” you can.  Even if it is not in your field or for small or large companies, this will help you become familiar with the process and your responsibilities as a business owner.

If what you are selling requires a lot of local fees and you are able to do so, it might be worth it to investigate moving a few blocks to another city for a better tax rate.  For example, some cities welcome home based businesses and have no tax while other may tax you a $400 a year.  If you can rent an office for that much, you might as well sign a lease or if the next city over has no tax and all other things are equal, move.

Determine if you need to pay sales tax.  Generally, if you sell a tangible item then you do however many states are desperately trying to eliminate every exception so you have to charge your customers sales tax on everything then pass that tax to the state.  Be sure where you stand.

Avoid sales tax, at least for the 1st year.  Rethink augmenting your business by selling novelty items or hats, etc.  Focus on delivering well developed project plans which is really what your customer is looking for and what you want to do as a profession.

For the most part, professional services, consultants, and similar businesses are selling ideas, strategy, guidance, expertise and not products.  So in the beginning, such intangibles items as a thought was not taxed.  This is changing so be sure to consult with a tax professional.