Re: [Web-Technology-of-Frederick] Starting as self-employed: any experience?

From: Steven H.
Sent on: Tuesday, March 20, 2012 3:51 PM
Max,

I forgot to mention. I went with Gary Desper to help me with LLC documents years ago. I know him personally and he was reasonably priced. Worth a consideration at least. Not Frederick local, but not too far away (Eldersburg I think these days).

Best of luck,

Steven

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Steven Haddox
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On Tuesday, March 20, 2012 at 2:08 PM, Max Mathieu wrote:

Steven, Matt, Stephen and Phil: big thanks for your answers, others in the list will surely benefit from them!

I will probably go first see an accountant to see what he recommends. If some are interested, and can tell you what I end up doing.

See you,
Max

On Tue, Mar 20, 2012 at 1:06 PM, Phil Harmon <[address removed]> wrote:
I thought I'd chime in on this one. I've been incorporated for 6 years as an S-Corp and have learned quite a bit.

Here are a couple hints:
  • Accountant: Pay the money for an Accountant to make recommendations about money and corporate entities.
    • Taxes - Also pay the money for them to do your taxes, trust me... it's a mess to figure out on your own.
    • Tax write-offs - Again, have your accountant tell you everything that you can write off. You can save money on home office, driving to client sites, purchasing equipment, etc... Your accountant is the best for this. 
  • Lawyer: Create an entity (LLC or S-Corp).
    • Entity Creation -  a Lawyer to draft your paperwork. You can draft the corporate paperwork yourself. Or pay a service (LegalZoom). But you will realize afterwards that you could have done it yourself just as easily. Look at other companies paperwork and copy.
    • Contracts - You don't need a lawyer who specializes in business if you are putting together simple contracts with clients, just a lawyer, be diligent of how much money you spend. Law fees will be the most expensive fee there is.
  • Money
    • Do not work for free. All time is billable
    • Do not be afraid to raise hourly rates
    • Put penalties in contracts for late payments
  • Insurance
    • There will be a stage of your company, where you will need to pay insurance to cover yourself. This can easily be around $3000 a year for a single employee. But do not worry about this until companies start asking you for this.
Just my two cents.

Thanks,
Phil Harmon


Xelltech, Inc

Principal, Lead Developer

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On Tue, Mar 20, 2012 at 12:40 PM, Matt Burkhardt <[address removed]> wrote:

Max,

There are no sales taxes on consulting services in Maryland.

As to the issues with setting yourself up as self-employed, you have several options. They are:

  1. Just start doing it - you'll have to track it as income for tax purposes. You'll be treated as a sole proprietorship. Probably the easiest way to go.
  2. Set yourself up as a Limited Liability Corporation - helps with some of the liability issues and makes you look more like a "real" company.
  3. Set yourself up as a corporation - although I did it this way, I needed to because of some of the requirements for raising equity. You probably don't want to do this because it adds a lot of overhead that's not really needed in a one person shop.

I would just make sure you track your income and expenses for doing work and go the sole proprietorship route. If and when you decide to expand, you can always move up to an LLC or a corporation. My brother, John Burkhardt, is an attorney out of Baltimore, but I know there's plenty of good lawyers here in Frederick as well. My brother can be contacted at [address removed].

Good luck and please send me your resume / CV. Mostly interested in your abilities with CMS / PHP / design.

Thanks,

Matt

On[masked]:27, Max Mathieu wrote:

Hi all,
I am close to finally get my work authorization, and I'd like to setup the right things to be able to work as self-employed
I found plenty of information on state.md.us, but I can't find if Maryland asks for sales tax on consulting services (tech consulting, web development)
Do you have experience with it or know a good lawyer that can help me with this whole procedure?
Thanks for your feedback, and have a good afternoon!

Max




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