Monday, June 15, 2009

Is it possible to file a dba but hold off starting a business until a later date? -

Already spent the money but for financially reasons can t start until later. Do I have to pay taxes/get a business license for not doing anything for the past few months? I don t want to cancel it.

You have set it up and not begin to operate it yet - When you open the door and start doing business you are dba for all income that isderived from that point. If no income has been generated from business then notaxes would be due. The key is when you open the door and actually start sellingsomething. The business license is usually issued on estimated sales the first yearand you should get this a reasonable time before you open.

I m not sure if this varies by state, so I am answering for Florida.No. As long as you tax id number doesn t show any activity in the IRS database (i.e. depositing checks written to your DBA, getting a bank account, applying for tax exempt status, applying with D.O.R. (dep of revenue) to charge sales tax, another person/business making a write-off to your DBA, etc..) then you have nothing to worry about. As for your business license: You are not required to obtain a business license unless you plan on doing business. You can t open a bank account, or charge sales tax without a business license so I guess that kills 2 birds with 1 stone.Hundreds of people do exactly what you are doing right now, my wife is one of them. You won t have to pay any taxes because you have no income to claim (from your DBA). Also, hundreds of business will shut their doors LONG before their DBA status expires, so while I can t show you any facts, it s obvious that a DBA license is not obgliated to be constantly tethered to an annual federal income tax record nor an annual business license (aka business tax).

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