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Would it be ok to start a business first before applying for your business license?

Discussion in 'BlackHat Lounge' started by HumbleInvestor, Jul 11, 2016.

  1. HumbleInvestor

    HumbleInvestor Newbie

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    Are there people who make an online website but don't have the money to get an llc? Say that your 100% sure that a few sales would get you there, would it be ok to start a business first before applying for your business license? Note, I'm not talking about a site with blackhat methods but I mean an actual business.
     
  2. Blakereed

    Blakereed Regular Member

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    Wouldn't get an LLC right out of the gate. Depending where you're from I would start with a sole proprietorship then if the business works out looking to an LLC or Scorp. Words of experience, wish I had some one tell me the same when I started ;) Good luck!
     
  3. Skyebug77

    Skyebug77 Jr. VIP Jr. VIP

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    yes, it is perfectly fine. States generally have a rule such as if you make xx,xxx amount a year from a venture you must register and report taxes on te business. Check out your local business code.

    So, yes. You can wait until you make a certain amount before doing so.
     
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  4. sumitgupta1992

    sumitgupta1992 Junior Member

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    You can start as an individual/proprietor and then convert to LLC when you have made a certain threshold of money.
     
  5. ChanzGrande

    ChanzGrande Elite Member

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    Oh my goodness. I would have to start 12-15 LLC every year if it was actually required to start a business of this nature. Generally for stuff like this you would be fine to start small and grow into some business structures like LLC/Partnerships/Corporations. There are certainly times when it makes a lot more sense to establish these entities even at the time of business origin, but for the most part I wouldn't start these structures unless/until I knew an endeavor was going to have a high probability of success and offer considerable return on initial investments.

    Sometimes if there are a lot of possible "partners" it can make sense to have some partnerships or LLCs set up appropriately, but generally if you are in that category of question - your lawyer can tell you what is best to do.
     
  6. GreyWolf

    GreyWolf Executive VIP

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    Yeah, what Skyebug77 said pretty much explains it in a nutshell.

    For the most part selling anything online through websites like craigslist or ebay and the like is about the same as having a yardsale. If you make any money through affiliate marketing then the biggest legal requirement is that if you exceed a certain amount then it should be reported as income on your taxes. As far as setting up a website (even one specifically for a full online business) would be considered about the same as a hobby in most instances until it actually starts making any money. So in most cases there isn't really any need to initially worry about things like business licenses, fictitious business names (DBAs), etc. unless it actually starts having some level of success.

    In some cases you might want to do so anyway for things like protecting a business name, tradmark, copyrights or other similar reasons. But in most cases that isn't a concern for most people setting up a website in the hopes of starting an online business.

    Of course all that advice only applies if we're talking about an individual setting something up from home. If you're starting some type of major business enterprise with substantial investment, then you should probably treat it the same as if you were setting up a traditional offline business.
     
  7. HumbleInvestor

    HumbleInvestor Newbie

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    Thanks everyone for replying, all was helpful information. I greatly appreciate it!!!
     
  8. Rodolfo Clemente

    Rodolfo Clemente Regular Member

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    It depends on your country. Make a research about it,
     
  9. Reaver

    Reaver Jr. VIP Jr. VIP

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    What the hell is a business? I thought we all just did this for fun.

    I had a DBA in my state for a few years before I made the shift over to registering it as a business. A DBA is less than $100 in my state. Just had to pay the appropriate taxes on my income every year.