MyUSACorporation

How To Obtain A Reseller Permit (Sales Tax ID) Sales tax is a tax on the end-purchase of a product or a service, and is imposed on all retail sales, leases and rentals of most goods, and on some services that are considered taxable. Sales tax normally does not apply on the purchase of a product intended for re-sale or for subsequent processing. Sales tax is usually represented by a certain percentage added onto the price of a good or service that is being purchased. Your sales tax responsibilities as a new business owner, whether you start a business or buy an existing business, will vary depending on the type of organization or entity you operate. Besides state level, estimation of sales tax is also done on municipal or county levels. Payment of state sales tax depends on your sales and your state's regulations. Sales tax is intended to be applied on the end user of the product/service, so normally it is the consumers who are burdened with it. The re-sellers on the other hand are exempted from it, provided they do not use the goods on which sales tax is levied. Some states don't have sales tax. Those states are: Alaska Delaware Montana New Hampshire Oregon What is Sales Tax ID Number? Sales Tax ID Number or Sales Tax Exemption Certificate is a legal document issued by the state. This Certificate of Authority gives your business the authority to collect the required sales and use taxes, and to issue appropriate sales tax exemption documents, including resale certificates used for purchasing inventory. Sales Tax ID Number comes in different forms and is also known by other names: Reseller Permit Sales Tax Vendor ID Number Sales Tax Registration Reseller Tax ID Sales Tax Permit Sales Tax Exemption Certificate Certificate of Authority State Tax ID Number Reseller Certificate When Should I Get Sales Tax ID? If your business is required to be registered as a sales tax vendor, you must obtain a sales tax permit from the state's Tax Department. If you make taxable sales before you receive the sales tax exemption certificate, your business may be subject to substantial penalties. Why Should I Get Sales Tax ID? When selling a product or offering a service that is taxable, you will need to collect sales tax. Your Sales Tax ID Number authorizes you to collect sales tax on your taxable sales. Once you receive your Sales Tax ID Number you are considered to be in business even if you never make a sale or never open the doors of your establishment. It is therefore important that you file your sales tax returns on time, even if you did not have any taxable sales during the reporting period, to avoid being subject to penalties for not filing. Changing Organizational Structure If your business changes its organizational structure (for example from Sole Proprietorship to Corporation, LLC, or Partnership), the new organization must register as a new sales vendor and obtain a new reseller certificate before beginning operating under the new organizational structure. You must also file a final return for your existing business and surrender the old sales tax permit. Displaying Your Sales Tax Certificate https://www.myusacorporation.eu/salestax.html

Registering Your Company In The U.S. Drop-shipping is a very popular modern business concept, and U.S.-based drop-shipping businesses became the driving force of the "location-independent entrepreneur" phenomenon. Much has been written on the mechanics of the drop-shipping business itself, so this article will only cover the aspect of U.S. company registration, taxation, banking, and other related business filings. Running your drop-shipping business under a U.S. company has many advantages, and given the relative affordability and ease of registration and maintenance of U.S. companies, it is highly recommended to organize your business using a U.S. legal entity such as LLC or corporation. Let's explore some of the questions related to U.S. company registration specifically for your drop-shipping business. Choice of State Since a drop-shipping business owned by you, a non-U.S.-based entrepreneur, has no physical connection to any specific state you have the freedom to select any of the 50 U.S. states and DC as the home state of your U.S. company. It is recommended to form your company in one of the incorporation-friendly states, such as Delaware, Wyoming, or Nevada. Majority of our clients choose either Delaware or Wyoming, due to more expensive fees in Nevada. You can see the comparison between those 3 states here: DE vs. NV vs. WY. Because a drop-shipping business essentially deals with tangible goods, the question of sales tax becomes relevant, and as a result many drop-shippers opt for registration in one of the states that have no sales tax. We cover the issue of sales tax as part of our article U.S. Taxation for Foreign Entrepreneurs: Sales Tax, and it is more complex than just picking a no-sales-tax state, however a decision to register in one of the no-sales-tax states is not without a degree of merit. Delaware, being a no-sales-tax state, is often the state of choice for drop-shipping business registration, however it is important to note that the registration and maintenance of a company in Delaware are relatively costly, making some other no-sales-tax states an attractive alternative. These states are Oregon, Montana, Alaska and New Hampshire. It is also important to note that Wyoming, despite having a relatively modest sales tax, is still an attractive state for drop-shippers due to the fact that it is the least populated state, which means the chance of needing to worry about collecting and remiting sales tax in Wyoming is negligeable. Choice of Entity Foreign drop-shippers can choose primarily between two types of entities: LLC and C-Corporation. LLC is the most common type of entity chosen by our foreign clients due to its simplicity, flexibility and single taxation. C-Corporation mostly chosen by young entrepreneurs looking to obtain Angel or VC financing. You can see a comparison between LLC and C-Corporation here: LLC vs. Corporation. It is important to understand that as a foreigner the choice between LLC and Corporation typically comes down to how one wants to be personally taxed. We cover many questions of taxation in our article U.S. Taxation for Foreign Entrepreneurs, and would like to invite you to go over that article, as well as consult a U.S. tax specialist, prior to making a decision on which type of company to register. There is one tip that is worth giving here - you certainly can't go wrong with registering an LLC, simply because an LLC is such a flexible entity in terms of taxation that if you at some point decide that you would rather have your company taxed as C-Corporation, you can just file a C-Corporation election for your LLC with IRS. You don't get such flexibility with corporation. Additional Information and Things to Consider https://www.myusacorporation.eu/dropshipping.html

How To Form A Corporation Corporation is a legal form of organization of persons and material resources, chartered by the state, for the purpose of conducting business. Corporation is owned by shareholders, the Board of Directors governs the business, and elected officers manage the day-to-day activities. Corporation must adhere to corporate tax laws and file corporate taxes regularly. A Corporation, also referred to as Standard Corporation, C-Corporation, or Regular Corporation, may have an unlimited number of shareholders, including foreign citizens, may be public (when shares are offered for sale to the public) or privately held (when shares are not sold to the public). Usually shares of the corporation are held by the founders, board members and private investors, such as venture capitalists, who may or may not sit on the board of directors. C Corporation is the most common type of incorporation. C Corporation is considered to be a for-profit, state-incorporated business. Registration is done with state authorities and must abide by corporate laws in the state where it is incorporated. Corporation provides protection to its shareholders from the corporation's liabilities, thus the term "limited liability". However, C-Corporations also have what is called "double taxation" - first the corporation is taxed on its profits, and then shareholders are taxed on the distributions they receive, such as profit sharing payments or dividends. To incorporate you will need to register your business name, file a certificate of incorporation or articles of incorporation, and pay a fee. You will also need to draft corporate bylaws and hold a board of director's meeting. Why Should I Incorporate? Incorporating is one of the best ways to protect your personal assets while doing business. Most people choose to incorporate solely for this reason, but its not the only advantage of incorporation. For example, owning a corporation can save you tax money, allows for a greater business flexibility, reduces your chances to be audited, provides tools for better itemization, and makes raising capital less complicated. Advantages of Incorporating https://www.myusacorporation.eu/corporation.html

How To Form An LLC A Limited Liability Company, or an LLC, is a relatively new business structure, that first appeared in Wyoming in 1977, and is now recognized by every State's statute and the IRS. An LLC is neither a partnership nor a corporation, but a distinct type of business structure that offers an alternative to those two traditional entities by combining the corporate advantages of limited liability with the advantages of pass-through taxation usually associated with partnerships. Limited Liability Companies are becoming more and more popular, and it is easy to see why. In addition to combining the best features of partnerships and corporations, LLCs avoid the main disadvantages of both of those business structures. Limited liability companies are much more flexible and require less ongoing paperwork than corporations to maintain them, while avoiding the dangers of personal liability that come with the partnership. Some examples of famous LLCs may surprise you – both Amazon and Chrysler are organized as limited liability companies. https://www.myusacorporation.eu/llc.html