Shareware Laws
-
What's up, I was looking through some of the other posts about shareware but none talks about the laws. For example, I read some article stating that you must create and register as a small business in the US to be able to sell shareware. I would guess this involves lawyers and lots of paperwork and fees. However, if this is the case, how come there are thousands of shareware programs, many of which I'm sure don't get many registrations? :wtf: I bet there has to be some control system for the government to collect tax, etc. Thanks, Eric
-
What's up, I was looking through some of the other posts about shareware but none talks about the laws. For example, I read some article stating that you must create and register as a small business in the US to be able to sell shareware. I would guess this involves lawyers and lots of paperwork and fees. However, if this is the case, how come there are thousands of shareware programs, many of which I'm sure don't get many registrations? :wtf: I bet there has to be some control system for the government to collect tax, etc. Thanks, Eric
-
What's up, I was looking through some of the other posts about shareware but none talks about the laws. For example, I read some article stating that you must create and register as a small business in the US to be able to sell shareware. I would guess this involves lawyers and lots of paperwork and fees. However, if this is the case, how come there are thousands of shareware programs, many of which I'm sure don't get many registrations? :wtf: I bet there has to be some control system for the government to collect tax, etc. Thanks, Eric
Eric Sanchez wrote: I would guess this involves lawyers and lots of paperwork and fees. Creating a small business entity typically costs less than $100 USD, the paperwork can be completed in an afternoon, and doesn't require a leech (err, lawyer, I mean).
-
What's up, I was looking through some of the other posts about shareware but none talks about the laws. For example, I read some article stating that you must create and register as a small business in the US to be able to sell shareware. I would guess this involves lawyers and lots of paperwork and fees. However, if this is the case, how come there are thousands of shareware programs, many of which I'm sure don't get many registrations? :wtf: I bet there has to be some control system for the government to collect tax, etc. Thanks, Eric
Generally to do business in the US you do not need to do anything. In most locales (if not all) if you don't want to use your own name, you can register a DBA (doing business as) and leave it at that. (You will pay taxes from this business using form SE, but you'll be able to write off certain expenses, etc..) If customers vist your place of business, you will likely need to get a business license from your local city or county. The main reasons for this are a) income for the city and b) a fire and safety inspection. You may have to contact your city, county or state to pay property tax on your inventory and equipment. (This tax was almost the most annoying. You quickly understand why your company doesn't upgrade systems and other hardware, especially piecemeal.) If you live in a state with sales tax and sell goods or services which are subject to sales tax, you will need to get a tax number from the state. (Typically, if you sell a good to anyone in the state where you do business, even if you are selling over the internet or by phone, you must collect sales tax from that buyer.) If you have employees, you will need to get a tax ID number from both the state and federal government. You'll then need to to withholding and all sorts of very annoying accounting and payments. With a tax program like QuickBooks, it's actually quite easy to do, though I always went to an accountant to do my year end taxes. The caveat is, if you are doing business under your own name or as a DBA and get sued an, you can lose everything. However, setting up a corporation (even an LLC) can be a hastle and generally isn't worth it for small time stuff. If you live outside the US, you may be liable to your own governments for import/export fees, VAT, etc.. PS. Be very careful about writing off a home office. This is one of the primary audit flags the IRS uses because most people overestimate and/or misccalculate the worth of that office. I ran a business out of my home for five years and never bothered. FYI. I owned and ran an S corporation for five years. Today, I'd use an LLC, but those were just starting when I started my business. I also made the half-mistake of using accrual accounting. Technically it was the right thing to do, but it sure caused hassles down the line. Anyone who thinks he has a better idea of what's good for people than people do is a swine. - P.J. O'Rourke