When we last met, I went over some of need for licenses and permits, as well as how to locate which one are right for you.

You may already have a plan and form of your business entity set and if you do great, if not, I'd like to share a few things with you.

Form of Entity?

All offer advantageous to you when you start a business, however there are disadvantageous too.

- Sole proprietorships are most simple for a business owner.

A sole proprietor does not have to file a separate business tax return.

A Schedule C is attached to your 1040 and filed with IRS.

Gains and losses from business are simply combined with other personal taxable items,

Disadvantages include having personal liability and lack of investment flexibility.

If you need cash you need to personally have it in bank, or you can borrow it from bank.

- Partnerships are similar to sole proprietorships, in that formation is generally easy, however, you would be wise to use an attorney.

Also taxes are simply passed through to individuals personal tax returns.

The disadvantages are same as being a sole proprietor, personal liability and lack of investment flexibility.

- Limited Liability Corporations (LLC’s) do much better in limiting your liability, as name implies.

Disadvantages include costs of setting up.

Federal limits on who and what are able to be LLC’s and tax implications both federal and state.

- Corporations offer most personal and asset protection and have greatest flexibility of any business entity.

Corporations vary in their structure and organization.

People starting out in their first home based business adventure almost always suffer information overload in early stages of trying to get their business up and running. I often refer to this as "taking a drink from a fire hose syndrome".

For first time home business entrepreneur there will be a great deal of "newness" to virtually all aspects of getting their business started. When you combine all of this "newness" along with natural sense of excitement and eagerness, it is easy to understand how people can easily fall prey to feeling of being overwhelmed and lost.

To a degree, confusion/frustration/overload situation frequently encountered in initial startup phase is often similar to old saying about trying to run before learning to walk.

The steepness (is that a word?) of learning curve depends not only upon particular type of business that is being undertaken, but also upon background and skills of person starting business. In any event, when first starting out, people will usually try to move forward too quickly.