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I'M READY TO DIVE IN... I JUST NEED A CLEAR ANSWER ON LEGAL MATTERS


Vendinlen

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(edit - if it matters, I envision myself starting off with single head gumball machines at 25 cents. May upgrade in the future)

Hey guys, 20 year old male living in Southern California (specifically Los Angeles). 

I've been reading a lot about bulk vending on these forums and am pretty excited to purchase my first machine and try to get it located. Eventually, I'd like this venture to grow into a sustainable income and possibly even expand with employees to make major profits. 

Locating places, getting good deals on machines, servicing, etc. all seem pretty straightforward. Obviously there will be things to learn along the way, but I think I can manage and figure it out and take it slow. 

BUT

The one thing that I am still confused about, and it seems IMPOSSIBLE to get a straightforward answer from my internet searches, is the legal aspect of things.

Can somebody who is actually knowledgable on California law tell me exactly what I would need?

From what I've gathered, I'd need to set up either an LLC (800$ a year, protected) or have a sole Proprietorship which is no fee and no set-up required but I need to get insurance? If I understand correctly? 

And then as far as taxes, it is pretty damn confusing to me. This would be my first business venture and as you might be able to tell I know squat about taxes. 

My only experience with taxes is barely having done my first tax return last year. So I am pretty unfamiliar with all the terms involved with tax forms. 

 

This may be a lot of info to present so if anyone can type out answers, or provide me some references where I can educate myself on this information without going to a billion different google searches trying to piece things together,  that would be great. Thank you very much!

 

In short, I just want an understandable summary of the legal requirements for me to start placing machines in the Los Angeles area. Thank you so much 

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You may or may not find bulk vending to your liking. Before you spend any money or effort on business licensing, taxes, etc. put out ten machines, run them awhile and really see if this is what you want. Just do everything cash and under the radar. If you like bulk vending then get into the process of setting up bookkeeping, taxes, licenses, insurance etc

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6 minutes ago, musser said:

You may or may not find bulk vending to your liking. Before you spend any money or effort on business licensing, taxes, etc. put out ten machines, run them awhile and really see if this is what you want. Just do everything cash and under the radar. If you like bulk vending then get into the process of setting up bookkeeping, taxes, licenses, insurance etc

Thanks for taking the time to respond. While you do have a point, and I probably will follow your advice, I'm still gonna need to figure this information out anyway so I think this thread will still be useful to my future. You're probably right though, on the beginner scale I don't think there are too many concerns 

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I'm from LA as well, I completely agree with musser, because honestly, starting out learning a business and figuring out tax things at the same time is a pain, and slows things down.

But once you're sure, you can decide which way you want to establish. I'd avoid S corp in CA, because they charge $800 a year minimum. LLC, sole prop, and S corp all have pros and cons, I have a CPA I worked with in La Canada (right above Pasadena), who might answer some basic questions for you if you ask nice enough lol. You can google her, name is Lia Lee. Or I can dig up her info if you need.

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Keep records during your trial period in case u do decide to continue. ESPECIALLY mileage on your vehicle! That is always my biggest "expense" for vending and for my window cleaning company. Run it as a sole proprietor for now. Theres very little liability risk for gumball machines, so unless its required by the state id leave that on the table for now. Im in Kansas so im not sure on their requirements.

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