[AccessD] OT Got it: Was... Rate for first time

Charlotte Foust cfoust at infostatsystems.com
Wed Apr 2 14:44:33 CST 2003


You don't have to be incorporated for most contracts.  All they want is
an actualy entity, rather than a private individual, and a registered
fictitious name (dba) serves that purpose.  With a dba, all you need is
your personal tax id number.  You don't need a different taxpayer's ID
unless you have employees.

Charlotte Foust

-----Original Message-----
From: MartyConnelly [mailto:martyconnelly at shaw.ca] 
Sent: Wednesday, April 02, 2003 11:09 AM
To: accessd at databaseadvisors.com
Subject: Re: [AccessD] OT Got it: Was... Rate for first time




Hollis,Virginia wrote:

>Well I got it for 60.00. The only thing, they said I would either have 
>to get a tax number or go through a temp agency. Well everyone knows 
>what happens when you go through an agency... I would end up with 
>probably 30 of that.
>
>So, how do I go about getting a tax number?? Is there anything else I 
>would need to do?
>
>Virginia
>
>  
>
  Hmm a temp agency should take no more than 15 to 20 % for 
administering a contract.
Years ago I could get it for 10%, so shop around, I remember getting it 
for as low as 5%
when I had to get my contract assured under a government master standing

offer..


 Generally there are 3 major steps to take
   1. Either incorporate your self or form a limited liabilty
partnership
       (can be a partner of one). Takes a week. If  you set your self up

as a
       numbered coporation it is quicker. They dont have to do a name 
search,
       if you decide to name your corporation as Virginia Hollis & 
Associates.
       Once you have incorporated or whatever level of business is
allowed
       in your state you go to step 2
   2 Take your State assigned incorporation number to a bank and open a
       Business or  Commercial Account.  You will have to show a 
physical letter
       with the number. Takes a couple of days.
   3. Take your Bank Account and State Corporate Account number.      
        and get your various tax account numbers from state and federal
        authorities (This is fairly straight forward unless you are 
hiring other people
         then you get into withholding taxes.) Could be a week (who
knows?)

   Things to consider:
       It will cost you more to fully incorporate say 500 to 700 dollars
       I do it cheap (have a kid brother who is a lawyer). In Alberta 
you can
       incorporate online (just fill in the forms). They will even UPS 
your minute books
       and corporate seal. Fully incorporated, you have less liability, 
a limited
       partnership may leave you open to a legal suit where your house 
may be up for
       grabs. So you need Business Insurance or E&O (Errors and 
Ommissions) insurance.
       I don't know rates in US, in Canada its about a 3 - 5 hundred 
dollars a year per million
       depending on your business. At least you don't need K&R insurance

from Lloyds at
       3000 a month per million ;)

       You will probably want to hire an accountant who will do your 
taxes and books, don't
       skimp on this, in fact he can probably advise you on the best 
form of incorporation
       for your situation and what intial steps to take. Also he will 
tell you whether it is
       better for your corporation to pay you via monthly dividends or a

direct salary (which
      may mean withholding taxes, unemployment insurance (more forms) 
etc depending
       on your state.

       You can probably sign your contract saying your government 
assigned numbers
       are pending. Knowing how long some companies will take to pay an 
invoice,
       some can be longer than 90 days,  you will probably be okay.  If 
this is a problem
       you might want to amend you contract to a shorter time frame once

you have had
       a lawyer look at it. Discuss this before you sign. I have done 
3'd party subcontracts
       to IBM where it has taken more than 6 months to be paid. If this 
is the case you may
       want to establish a good line of credit with your bank. You will 
not get this for your
       business for 2 years and established a banking  record and have a

written business plan,
       so it will have to be personal line of credit.

       I might be inclined to say go the temp route intially if your 
finacial situation is such that
      you don't have several months salary in the bank as a nestegg.

    Take this with a grain of salt because I am speaking from a Canadian

perspective.       


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