Owning your own business is the dream of many ambitious entrepreneurs. Some small business owners get caught up in the fantasy and unknowingly ignore laws pertaining to their industry.
This can lead to some hefty fines on the local as well as the federal level. We’ve compiled some of the “Need to Know Legalities” for small business owners in hopes of saving some headaches down the road.
Local Small Business Laws
Each state and even county has different laws when it comes to small business. These local laws or ordinances can include, among other things:
- requiring a license
- filing for a permit
- restricting use of real estate for certain businesses
The City of Las Vegas has a great page on their website, “Know Before You Apply,” which includes helpful information on things like the licensing of a home-based business and operational standards for small business owners.
Here in the state of Nevada, there is an annual fee for registering your business or corporation (starting $200). If you fail to file for a state business license, you guessed it, there is a monetary penalty of at least $100 (non-profits as well as a select other few are exempt from this process).
The City of Las Vegas recommends that you register your small business with the State before applying with local agencies. Doing it in this order can help save you time and money.
Federal Small Business Laws
Federal laws work in a very similar fashion as the state and local regulations for small business owners.
There may be specific agencies that oversee your industry (e.g. the Alcohol and Tobacco Tax and Trade Bureau, U.S. Department of Agriculture, etc.). The U.S. Small Business Administration has some great resources and compliance contact information for a plethora of industries, you can find that here.
Arguably the scariest and potentially most expensive errors a small business owner can make have to do with taxes. Applicable taxes again depend upon your specific industry, like the types of goods/services provided, the type of business structure you have, where the business is physically located, and many other factors.
There are federal, state, and local tax laws to be familiar with no matter what type of business you run.
On the federal level this may include income tax, self-employment tax, social security, Medicare, and excise taxes. Most businesses must apply for a federal Employer Identification Number (EIN) for tax administrative purposes.
Locally, there can be property taxes, franchise tax, sales tax, and workers’ compensation coverage just to name a few.
Running a small business is a job in itself keeping up with all the legalities. Many owners turn to firms like Pickard Parry Pfau to help navigate them through the process smoothly and help prevent any costly surprises.
If you’re thinking about starting your own business or already have one up and running, give us a call. We’ll make sure you’re on the right track and all your legal t’s are crossed and i’s dotted.