Setting up your Graphic Design Business in Texas
| Date: June 18, 2012 | Categories: Business Matters, Freshly Cut Design | Comments: 16 Comments | Share: |
Really… It’s not too hard, but the steps can be overwhelming when you first sit down to get it all straight. These are the things that I did to establish my design business as a Sole Proprietor. Clearly, I am not a lawyer, so if you have any doubts or concerns, I highly recommend you consult with a business attorney. I can even recommend a few good ones! I can’t be held responsible for any of your business decisions and yadda yadda yadda… so please don’t come after me if you mess it all up and feel the need to kick someone’s ass. Once your business is all set up, it will essentially run itself and will only need a little bit of maintenance from you each month.
1) Register your DBA with the State of Texas - doing business as – This is also called the Assumed Name Records Certificate of Ownership for Unincorporated Business or Profession. (sheesh!) I actually went down to Travis County Clerk’s office and did this. The address is 5501 Airport Blvd, Austin, 78751. You will need to pick your name and then run a check at the Clerk’s office to make sure that no one is already using it.
Here’s the link that tells you how to register your DBA:
http://www.co.travis.tx.us/county_clerk/dba.asp
2) Apply for a Texas Sales and Use Tax Permit: The graphic designs you produce ARE subject to sales tax in Texas. I’ve had clients try to fight me on this one until I called and got the exact tax code and sent it to them. Sales tax is due quarterly (by the 20th after each quarter ends. So, 2nd quarter 2012 sales tax will be due by July 20th). If you’re late, the state will charge you a hefty fee. I think it is $50…. so don’t be late! You can pay online. The amount of Sales Tax you need to collect is dictated by the city you live in, so double check! It varies throughout the state. Sales Tax is not charged for out-of-state clients.
Here’s the link to apply online (you’ll need to have your DBA first):
http://www.window.state.tx.us/taxpermit/
3) Open a bank account using your business name: It is necessary to keep your business funds separate from your personal funds. This allows for clean accounting. Anytime you want to “pay yourself”, just write a check to yourself and record it as Payroll in your accounting. (Uncle Sam will want about 28% of your income, so keep that in mind for the end of the tax year.) You will have to have your DBA set up before you can open a bank account in your business name. Most banks offer free checking to small businesses.
4) Keep track of your income and expenses: I use Intuit (Quickbooks online) to track absolutely everything. It’s really simple to set up and costs $13.80 per month. I have heard too many horror stories of people buying the desktop version of Quickbooks and having their hard drive crash and losing all of their financial data. I like knowing my info is “safe” out there in the clouds and not on my fallible hard drive. I use the Simple Start program. You can send invoices online, and people can also pay online with debit or credit (for an extra small fee per transaction). Once it’s set up, it is very easy and intuitive. Just make sure you enter those receipts and reconcile Quickbooks with your bank statement each month!
Here’s the link for Intuit:
http://quickbooksonline.intuit.com/
5) Register a domain name for your business: Even if you aren’t ready to build a web site portfolio for your business, go ahead and snag the domain. Set up the email right away and begin using it for your business. It looks loads more professional than a gmail or other free email account. I love Vervehosting (http://www.vervehosting.com/) It’s only $5.95 per month, and you can register your domain through them. I’ve been using VerveHosting since 2000. (Yup, the year 2000!) And they are so fast to answer help desk calls that you will be amazed!
6) Come up with a logo for your business as quick as you can and order business cards. I always keep some with me and hand them out when I am talking to people.
Remember, this post is for you solo-preneurs out there. If you have a business partner or wish to form a corporation or LLC, consult a business lawyer and always draft a Partnership Agreement between you and your business partner prior to starting your business. It would be a good idea to form a dissolution contract, too.
Am I missing anything? What did you do different in setting up your business? Leave a comment and let me know.
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