You will need an EIN number prior to filing business returns with IRS, so make sure you give yourself plenty of time to obtain one. For more information on EINs and your business, consult your accountant.

And while we’re on subject …

Q: I made extra money selling things on eBay last year. These were items I picked up at yardsales mostly. My husband says I am responsible for paying income tax on money I made, but I disagree. This is just my hobby, not a business. What do you think? -- Gladys A.

A: With so many people selling on eBay these days this is a question I get quite a bit. In fact, I have plans for a future “eBay and taxes” column, but I believe your question is more, “is it a hobby or is it a business?”

Again, I went to horse’s mouth (at least I think it was mouth) for answer. According to IRS there are a number of factors that help determine if your hobby can be considered a business and thereby make you susceptible to IRS tax rules governing business.

Do you carry on activity in a business-like manner? If you conduct your eBay activities like a business, i.e. you keep business records, track your profit and loss, keep a separate checking account, etc. then whether you think so or not, your hobby is considered a business.

If you put considerable time and effort into your venture, IRS may contend that you do so for profit and not fun. It seems folks at IRS don’t believe in doing things strictly for pleasure. My guess is, neither do you. If you weren’t making money selling on eBay I doubt you’d be bothering getting up at 4am to hit all those yardsales. Then again, maybe you would…

If you depend on income from your eBay activities for your livelihood, it’s a business, not a hobby.

There are a number of other factors IRS considers to determine if a hobby is really a business, but in your case I think that covers basics.

For detailed answers to any tax question you should consult a qualified accountant or tax attorney. God forbid you rely on a guy who is afraid to mumble letters “IRS” three times in a row.

Here's to your success!

Tim Knox

Tim serves as the president and CEO of three successful technology companies and is the founder of DropshipWholesale.net, an online organization dedicated to the success of online and eBay entrepreneurs.

Discuss how often you will get together. Will you meet for lunch once a week or for an hour in your office several times a month? It is important that you create an actual meeting schedule and stick to it. Without a set schedule life will get in way and you will cancel more meetings than you attend.

Next, set some guidelines and limitations. How often can your mentee call? Is it OK for them to call your cellphone or should they go through your secretary? Can they drop by office anytime? Can they call you at home after 5pm?

Set some goals for mentee. Assign them homework, give them a task. The relationship must be more than just chewing fat. The point is to help mentee grow, personally and professionally. Give them a list of books to read. Recommend seminars they should attend. Have them outline their business goals in writing, then you set milestones and hold them accountable for reaching them.

From your side of fence, don’t be afraid to share your successes and failures. Let your experience be their guide. Help them identify opportunities and avoid pot holes that you may have hit along way. Don’t be embarrassed to tell truth, especially if it can keep your mentee from making same mistakes you did.

As a mentor you should also introduce your mentee into your circle of friends and associates. Sponsor them into Rotary, take them to luncheons, and introduce them to others who might also help their careers.

Being a good mentor also means that you are a confidant; your mentee will share not only his business problems and goals, but also his personal feelings, his secrets, his plans, and his angst. Respect mentee’s privacy. Your discussions should not be fodder for your next poker night. When something is told in confidence, respect that or get out of mentor business.

One final point, a successful mentor/mentee relationship should not be a temporary relationship, but one that in ongoing, that grows and evolves until day you are no long mentor and mentee, but peers.

My own mentor, who probably has no clue that he holds that spot in my life, started out as an investor in one of my companies. As our business relationship grew so did our friendship and I found myself calling on him many times for advice. We eventually became business partners and today we are peers.

I tell him he is entrepreneur I want to be when I grow up.

He tells me to shut up and pay for lunch.

That’s how process should work.

Here’s to your success!

Tim Knox