lurtsman Posted January 9, 2009 Share Posted January 9, 2009 Can a P.O. box be used as the mailing address for an LLC? Does it vary by state? I'm living in an apartment and don't know that they would allow this address to be used as the location for an LLC. (There may be a provision about home based businesses built into the lease) Further I am hoping to move in the next year (looking for a good job in my field, currently I'm working at the library making a little over 8 bucks an hour), but I have my BS degree in HR. Since I don't anticipate staying in this apartment past the summer, P.O. box seems like the easiest option. There's a post office near by with available boxes costing 10$ per six months. So my cost is what else would be the necessary costs of having an established LLC. If I had no locations, I wouldn't need transportation, gas, or CoGs. I saw a thread about phone service and the different options people use for their work number. I'll need to copy someone else's plan because I don't want B2B telemarketers calling my home phone. (I'm planning on a straight to voice mail number, I'll never pick it up) Also, I heard at my local city hall about getting a vending permit, they said I needed to have a location first and then it was ten dollars. It wasn't clear if they wanted me to have a permit tied to each location, or just one permit. Has anyone else encountered this, ideas & advice? Thanks. This forum has saved me from what could otherwise have been a short lived and failed experience in vending. Building upon the knowledge of the kind and successful people here is allowing me a way out of the rat race. Link to comment Share on other sites More sharing options...
antoniocinisi Posted January 9, 2009 Share Posted January 9, 2009 I dont see why you cant have a p.o. box for your biz. just pay it by check and u should be able to deduct it like any other expense. Link to comment Share on other sites More sharing options...
alyssamma Posted January 9, 2009 Share Posted January 9, 2009 This varies by state. I am unsure about Iowa, but I would check with your Sec of State. In general, you *cannot*. However, Iowa might be an exception. Regardless, a quick call to your Sec of State will give you the answer! Kevin Link to comment Share on other sites More sharing options...
lurtsman Posted January 10, 2009 Author Share Posted January 10, 2009 If I can not use a PO box, how much trouble is it to change the address of the business when I move, and is there any danger associated with using your home address as your business address? (IE additional personal liabilities) Edit: PS. I have e-mailed the office of my secretary of state to check on if I can use a PObox for the LLCs address. Link to comment Share on other sites More sharing options...
alyssamma Posted January 10, 2009 Share Posted January 10, 2009 It is trivial to change your business address. It is just filling out a form. You might need to fill out multiple forms, though. No added liability that I am aware of. But to be honest, that is a Q for the lawyers FWIW, I have run an S-Corp for 8yrs with my home address as the company address. People do this all the time. In fact, probably 50% of S-Corps and LLCs are run from homes. Kevin Link to comment Share on other sites More sharing options...
lurtsman Posted January 10, 2009 Author Share Posted January 10, 2009 Do you know if there is a cost to file the form? I suppose I should not let a few bucks stress me into in action. That's my biggest challenge. I guess I'll start going over the lease. Do you use a po box for your business mail, or is it just delivered to your house? Do you get a significant amount of junk mail? I was considered that I didn't want to put my home address on my business card. Maybe don't print that? I've had some places that I located machines at wanting a mailing address for my business.... (well 1, but I've only placed 2...) Link to comment Share on other sites More sharing options...
alyssamma Posted January 10, 2009 Share Posted January 10, 2009 No cost...free to file We use our home address for everything. I had a business before this one (a C-Corp) with a "real" office. We got no junk mail there. To be honest, your personal info is on sooooo much more crap that it doesn't really matter what you do for your business...unless you are one of those magical people who don't get junk mail now On our business cards we just have phone (our home phone) and email...no address. I wouldn't even worry about your lease. Any clause like that in the lease isn't intended for what you are doing. It is to stop things like beauty/nail salons, etc. - things that have people coming in and out a lot. Or things where you are dealing with a lot of inventory. Other than machines, you won't be having anything shipped to your apartment...how would your landlord even know? I wouldn't worry about any of this. It all pales next to things like price hikes for candy, finding good locators, etc. Kevin Link to comment Share on other sites More sharing options...
lurtsman Posted January 10, 2009 Author Share Posted January 10, 2009 Thank you. I'll save the cost of the P.O. box then and just file for the business at our apartment address. You've taken so much stress off my mind. I'll be at work all day today, but I should be able to hit city hall on Monday for the paper work. I am so excited. Did you get a separate number for your machine stickers "service" number? (I was concerned about competitors having my home phone number, or getting random frivolous calls) Link to comment Share on other sites More sharing options...
alyssamma Posted January 10, 2009 Share Posted January 10, 2009 BTW, you should be able to do everything you need online...no need to visit anyone in person. Also, it doesn't go to city hall but to your state government. We use our home number. No random calls whatsoever. If you are really worried about that, tho, there are a zillion cheap ways to get an extra number. I would recommend Skype, but there are lots of others too. Relax, enjoy, and congrats on being a business owner Kevin Link to comment Share on other sites More sharing options...
bacho Posted January 11, 2009 Share Posted January 11, 2009 Kevin gave you excellent advice. I just wanted to add that I use my cell phone for the service number on my machines. That way if it's a number I'm not familiar with, I let it roll ovet to voice mail. Also, make sure you need a permit for a 25 cent vending machine and not a large snack machine when you're at city hall. My city only requires a permit over 25 cents. Good luck with your new business and let us know how you grow. Link to comment Share on other sites More sharing options...
lurtsman Posted January 11, 2009 Author Share Posted January 11, 2009 More great ideas. I'll plan to just use my regular number and let people I don't know head to voice mail. I'll definitely check about if a permit is required for 25 cent vending. Does it vary by city? Is it a case of where my business is located or where the vending machine is operated? (I'd assume it's a case of the city where the machine sits) Thanks for letting me know not to go to city hall for it, I would've looked silly there. Are they mailed in, or do most states allow for online submission with a credit card paying the filing fees? I thought the cost to file the form was 50$, but can't find the link and it's getting late for me. It'll be something to work on tomorrow. Edit: I realized maybe the way to do it online was to use one of the websites that file the forms for you. Those tend to charge for the service though, and I'm near broke so I've got to do just about everything the cheap way . If I can file online with no additional fee -- or only one comparable to gas money, then I'd definitely like to pursue that. Link to comment Share on other sites More sharing options...
alyssamma Posted January 11, 2009 Share Posted January 11, 2009 No...when I said online I meant at the Sec of State's website. DO NOT pay someone to do this for you...a waste of $ as the forms are easy to fill out. I took a look at Iowa's website (http://www.sos.state.ia.us/business/form.html) and it is interesting...they say they don't have an official form for an LLC (it is $50 to file). So, give them a call on Monday and ask them what form to fill out. What you need (permit-wise) and what taxes you'll pay (for local and sales) depend on what city and/or county your machines are located in. If you are only talking bulk, you *should* not have to pay sales tax. Confirm this with your Iowa tax department, though. I know this may seem like a lot to do, but trust me it isn't. You just need to make a few phone calls and everything will fall into place. Also, understand, it is ok if you wait a little bit before starting your LLC. When you start it you'll most likely choose to be taxed as a sole prop, so you can just work that way now. This means you track your income and expenses and report it on your 1040 schedule C. The *only* thing an LLC will do for you at this point is to protect you if you are sued. Good insurance will do that just as well. You'll need to have a pretty good income (at least $50K) to make having an LLC (or S-Corp) save you any $ through taxes. So, understand, you have plenty of time. Get some insurance and keep working as you are. PM me if this sounds complicated Kevin Link to comment Share on other sites More sharing options...
lurtsman Posted January 11, 2009 Author Share Posted January 11, 2009 Thanks Kevin. My reasons for setting up the company soon rather than waiting are for printing off my business cards (as locations ask for them), improving my resume (as I'll still be working other jobs while vending), giving myself more legitimacy as a vendor, and being able to track my income and expenses separate from my personal expenses to improve my case for a better mortgage rate when I buy a house and allow me to use my profits to purchase new machines without having to pay income taxes first. Losing a portion of my money to unnecessary personal taxes would dramatically slow my growth. I'm working off the mindset earn spend (on new machines) get taxed on what is left is better than earn get taxed spend what the government leaves for you the old person vs business tax law case -- though I believe your knowledge of business law and tax law is far superior to mine I figure off my job and my wife's (she's a student so she can't work much) we can get by while spending every quarter made by the machines on expanding the route and restocking. There are no words for how great it is to have someone with your knowledge to speak to and receive guidance from. Link to comment Share on other sites More sharing options...
alyssamma Posted January 11, 2009 Share Posted January 11, 2009 Lurtsman, I sent you a PM. Unfortunately things are not going to go how you think they will You won't get a tax savings from your business. Or, rather, you'll get the *same* tax savings if you did this w/o a business. What you spend on your business is pre-tax regardless of whether or not you have an LLC. Also, you *will* still pay payroll taxes with an LLC. *Everyone* pays them, regardless of what type of business you have. The only difference is a *portion* can be exempt with an LLC or S-Corp...but you'll need at least $50K or so in income to make this worth it. Also, there are advantages to paying payroll taxes. It counts towards Soc Sec and there are retirement plans (e.g., SEP-IRA) where this is good. Banks won't look at your business for a loan either. You'll need many years before that happens, and with a single person company they'll look at your personal finances anyway. You can put whatever you want on your business cards - and your bank account for that matter. It is called DBA (doing business as). I'm not telling you not to start an LLC - I think you should. I'm just saying you can do everything *now* that you'll be doing when you have your LLC, so there is no need to rush to form it. Kevin Link to comment Share on other sites More sharing options...
timberframe50 Posted January 12, 2009 Share Posted January 12, 2009 lurtsman, here were my cost for DBA, I have to go to the county clerks office and fill it a form. Plus a 5 dollar fee. They typed up a news paper ad I had to run for 3 weeks, this cost was $80. Once the ad was run they sent me a certification of ownership of this business. Since I'm just starting I didn't see the need for an LLC. Also I did put my name, address and telphone number on my business card, it is a matter of pride with me. Good Luck Link to comment Share on other sites More sharing options...
dperry Posted January 12, 2009 Share Posted January 12, 2009 If you scout out those mailbox businesses, you will find that when you get a mailbox from them, they let you list their physical address as your address, with your mailbox number as your 'suite' number. They cost more than the P.O., but it may be worth it given your concerns about it. But they may also be better because they will also take FedEx and UPS and USPS deliveries, whereas the USPS will only accept USPS packages for delivery. That will come in handy for your machine and product delivery. Also, I know that for licensing, in TX, you do need a license for vending in some very specific cases. In TX, you only need a license if you are not giving a product for the vend. That would apply to your arcade video games more so than your bulk vending machines. In this case too, you need to have a license sticker FOR EACH MACHINE from the State, County AND City. The state may also require you to file for a single overall business license in order to get the state license for each of your machines. Of course, you can't get a county license sticker without a state license sticker, and you can't get a city license sticker without a county license sticker. In TX, it would cost $200 a year for the business license, and $60 for the year for the state sticker, and $15 each for the county and city stickers, or $90 for just the stickers. That's $290 a year minimum for just 1 machine. If you had to license 10 machines, that would be $200+$900=$1100 a year. But as with all things, your state may do things differently than mine. Link to comment Share on other sites More sharing options...
lurtsman Posted January 12, 2009 Author Share Posted January 12, 2009 Is there a recurring cost for the LLC existing? I know it has a creation cost, though my focus needs to be on getting more machines purchased, operating and placed. Getting some business cards ready is also important for me. (Edit: In reference to the 200$ yearly fee in texas, as my business is not large enough to gain financial tax savings and those fees would eat heavily into my early profits. My primary goal in sticking it behind an LLC is to give legitimacy to my company name, and allow me to use it on my resume and master's program applications) Link to comment Share on other sites More sharing options...
Quarter Master Posted January 12, 2009 Share Posted January 12, 2009 Do what some of us do and start out as a sole proprietorship.Print some business cards off at home and then get moving placeing your machines. Your in business ! Link to comment Share on other sites More sharing options...
lurtsman Posted January 12, 2009 Author Share Posted January 12, 2009 Do what some of us do and start out as a sole proprietorship.Print some business cards off at home and then get moving placeing your machines. Your in business !In this method how would I avoid paying sales tax when purchasing candy for vending? (I like the plan of getting moving quickly, and after talking to Kevin, I must agree that ordering and placing machines is the most important part. Printing the cards will be part of that. Link to comment Share on other sites More sharing options...
alyssamma Posted January 13, 2009 Share Posted January 13, 2009 Lurtsman... 1) No recurring costs for an LLC (or any other type of business) other than taxes 2) When you form an LLC, you must choose how it is taxed. Most single person LLCs are taxed as a sole prop. This means filling out a sched C w/your 1040 and you are done. So, what you'll do now for taxes and what you'll do once the LLC is formed is identical. 3) You must pay sales tax on your purchases - a business entity does not mean you don't do that. The only time you won't pay sales tax (other than non-profit stuff) is when you are *selling* something that you collect sales tax on. For this business, that is usually soda, but can vary by state. I do not believe in Iowa you pay sales tax (or, rather, collect it) for bulk vending. However, let's say you had soda or something, then... 3a) Sales tax is independent of your business entity. You'll need a vendor's license (from your state's department of taxation). Once you get that, you'll need to fill out an exemption form - again your state's tax dept can help you with that. Then, just show the form when your make purchases. Again, this is primarily for soda and not food products. Kevin Link to comment Share on other sites More sharing options...
lurtsman Posted January 13, 2009 Author Share Posted January 13, 2009 Thanks Kevin . That helps alot, since sales tax cutting into my profit margins was a big concern for me. I don't know how you find time to answer all my questions, but I do appreciate it. Link to comment Share on other sites More sharing options...
alyssamma Posted January 13, 2009 Share Posted January 13, 2009 np...however, remember, call your state tax department to be sure - each state is different. Not to rain on your parade, but I did a quick Google search...it looks like you'll need a permit (but only 1) and *will* have to pay sales tax in Iowa. Here are a couple of links. http://www.iowa.gov/tax/educate/78516.html http://www.state.ia.us/tax/educate/78539.html However, call the tax dept to find out for sure. Since this is a state and not federal tax, I am not positive of Iowa's laws. Link to comment Share on other sites More sharing options...
lurtsman Posted January 14, 2009 Author Share Posted January 14, 2009 Thanks Kevin. Looks like there is more research to do. I've been finding Iowa a very frustrating state since I moved here. Until my wife finishes college, I have little choice though. I'm hoping by then I'll have a big enough business here to want to stay. I try to remind myself that other vendors in this area are having to jump through the same hoops as I am, and it should dramatically reduce my competition. (Or at least my legal competition) Link to comment Share on other sites More sharing options...
antoniocinisi Posted January 14, 2009 Share Posted January 14, 2009 Thanks Kevin. Looks like there is more research to do. I've been finding Iowa a very frustrating state since I moved here. Until my wife finishes college, I have little choice though. I'm hoping by then I'll have a big enough business here to want to stay. I try to remind myself that other vendors in this area are having to jump through the same hoops as I am, and it should dramatically reduce my competition. (Or at least my legal competition)at least u can carry a concealed weapon there!! Link to comment Share on other sites More sharing options...
lurtsman Posted January 14, 2009 Author Share Posted January 14, 2009 Reading through the first link shows this section: (Posting for anyone else interested in Iowa law, or for future reference as this thread will be something I need to review weekly until I memorize it) Vending Machines An operator who places vending (or other coin-operated) machines on different locations need only to hold one permit in a regular place of business. The one permit will apply to all machines located in Iowa If the sale of a substance is exempt from tax because it is a sale of “food†when the substance is sold by means other than a vending machine, then the sale of that same substance through a vending machine will also be exempt from tax. Conversely, if the sale of a substance by any means other than through a vending machine is taxable, then the sale of that same substance through a vending machine will also be taxable. See Prepared Food. Candy is specifically listed as taxable so long as flour is not listed as an ingredient, and it will not be considered prepared, therefore I should anticipate having to pay sales tax on the gross sales of candy. Unless there is an exemption I'm missing, it seems stickers/caps would also get hit by this 6% tax? (If so at least it will be easy to calculate how much sales tax I owe) Going to review the second link now. Link to comment Share on other sites More sharing options...
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