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A sole proprietorship is the simplest business form to register in Tennessee. If you want, you can but start working under your legal proper noun and apply your Social Security Number as your tax ID. However, you lot might want to use a business merchandise name or rent employees. In these situations, yous'll need to gear up a sole proprietorship. If y'all're in Tennessee and looking to get ahead in your career, yous're in the right place.

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    Decide if y'all want a trade proper noun. Tennessee generally expects sole proprietors to operate nether their legal proper noun. For case, Mary Smith will advertise her services every bit "Mary Smith, Hairdresser." However, you might be able to use a trade name, also chosen a fictitious name. You'll need to talk to your county clerk about this selection.

    • A merchandise name tin can help you stand out in the market, only counterbalance the benefits of a trade proper name confronting the hassle of getting one.

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    Pick a memorable trade proper name. If you desire a trade name, pick something consumers will remember. The proper noun should reflect your brand—the values and experiences you create for your consumers.

    • For example, "Smith Hairdressing" is ho-hum. It doesn't convey anything near your service.
    • Withal, "Improve Braids" tells consumers that you specialize in braiding hair, and that you lot're good at information technology!

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    Talk to your county clerk. Stop in and talk most whether you can get a fictitious business name for your sole proprietorship. The county clerk can tell yous what your options are.

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    Obtain a county business license. Contact the county clerk for the county where your main place of business is located. The license should toll effectually $15.

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    Go other required licenses or permits. Depending on your business, you might need licenses or permits earlier you can starting time operating. Many professions do—barbers, plumbers, funeral directors, accountants, surveyors, etc. Ask your county clerk virtually what licenses or permits are required. Also check with the Department of Commerce and Insurance.

    • If you lot need help identifying licensing requirements, you should consult with an attorney.

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    Register to pay taxes. If y'all sell goods or services to the public, you'll need to collect sales tax. Register with the Tennessee Department of Revenue to pay taxes. You'll need to create an account.

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    Hire employees legally. You lot must contact multiple state agencies before long after hiring your commencement employee. Begin by reporting new hires to the New Rent Reporting Program. You lot must report a new employee within 20 days of their hiring date. Annals for the program at https://newhire-reporting.com/TN-Newhire/default.aspx.

    • If you have v or more than employees, yous'll need worker's compensation insurance. Contact your insurance agent about getting acceptable coverage.
    • Complete Form LB-0441 to check whether you must pay unemployment insurance.[i]
    • You should register and use Due east-Verify to confirm your employees are legally eligible to work in the U.S.

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    Open up a bank business relationship. Store around commencement to notice a banking concern that offers the best deals for minor businesses. Some offer discounted fees, lines of credit, or concern credit cards.

    • Keep your business and personal banking separate so that information technology's easier to runway your business organization expenses.[two]

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    Buy insurance. Sole proprietors are personally responsible for all business debts and obligations. For example, if your business organization injures a customer, they can sue yous. If they win, they can come after your personal assets, such as your auto or your home. For these reasons, you'll want general liability insurance.[iii]

    • Don't look your homeowners insurance to cover concern accidents. It typically doesn't.
    • You lot can buy insurance by contacting an insurance amanuensis and discussing your needs.

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    Find office space. If you want to run a business from your home, check that your neighborhood zoning allows it. Stop into your zoning office and ask.

    • You can find commercial existent estate at websites such Loopnet.com or by contacting a realtor who specializes in commercial properties. Most commercial rents are calculated by square footage or every bit a percentage of your gross sales.[iv]

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    Write a business plan. A business programme identifies where your concern is headed over the next three years and how you lot intend to become there. You should typhoon a business concern programme if you want financing, since lenders will want to meet information technology. Notwithstanding, it's likewise a skilful exercise fifty-fifty if you don't need funding. A solid business program should take the following:[5]

    • Business description. Explain the purpose of your business organization. For example, you might desire to provide hair braiding services to people in Memphis.
    • Market analysis. You lot should identify your typical consumer in terms of age, gender, income, location, teaching, etc. Also hash out your industry. Is it well-established? Is it growing?
    • Competitive assessment. Betoken out your major competitors and analyze their strengths and weaknesses.
    • Marketing program. Discuss your products or services in greater detail. Identify what promotional efforts you will apply, such as social media, paid advertizement, etc. Also hash out your pricing strategy and how your prices will be attractive to your targeted consumer.
    • Operations and direction. Provide groundwork data on anyone who will help y'all run the business: education, business experience, etc. If yous sell products, identify who will manufacture them.
    • Financial plan. Create financial projections for the next few years, and approximate your income, cash period, and residue sheet. If you need funding, place the amount and explain what you will spend information technology on.

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    Hire professional person assistance, if necessary. As your business grows, you might need help keeping everything straight. Consider hiring the post-obit professionals:

    • Business attorney. A concern attorney can help you lot sue someone or defend you in a lawsuit. They can also help you negotiate favorable contracts. Get a referral to a business attorney by visiting the Tennessee Bar Association at https://www.tba.org/index.cfm?pg=find-an-attorney.
    • Bookkeeper. You might utilize software at first to record your daily business organization transactions. However, as your business grows, y'all might want to outsource this chore.
    • Accountant. An auditor can file your tax returns, simply they can do a lot more. An accountant might also help draft your business plan, identify sources of funding, or call up strategically about how to grow your business.

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Add New Question

  • Question

    I am an author who hopes to sell books through Amazon. Do I still have to file quarterly sales tax reports in Tennessee?

    Community Answer

    You don't. Amazon is collecting the sales tax and sending it to the government. All yous are getting from Amazon is royalties.

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