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business license for contractors

Hello freelancers!

What sort of business license do you have to get to conduct your freelance activities in this fair city? Do you have to become an LLC? Do tell!

Thanks!

Comments

  • You can actually just do business as an independent contractor and just use your name/SSN as your business info. Although I believe there are probably tax benefits to setting up an LLC.

  • Thanks, swamp. Apparently, I have to get some sort of license to contract with this particular company...
  • edited April 2015
    I'm registered as a sole proprietorship but probably switching to an S-Corporation. Sole proprietorship is pretty chill and super easy to set up.
  • Thanks, Judah. Do you know what the fee is? $100/yr ish?
  • I think there was just a one time fee, looks like $50. This is basically what I remember the process like: http://www.nolo.com/legal-encyclopedia/how-establish-sole-proprietorship-oregon.html
  • S-corp + liability ins is the best way to go IMO. Most large companies that hire a lot of freelancers/indys will require liability ins which is pretty cheap. In my experience a company doesn't care what kind of license/structure you have, but are sticklers on the liability ins.

    And don't just register and then forget about your S-corp, there's lots of stuff to get done most of which is really easy if you are just a 1-2 person company: http://www.nolo.com/legal-encyclopedia/how-form-corporation-oregon.html

    And especially don't forget about any quarterly/yearly filings that may be required. There is an annual filing to the Sec of State plus other filings that could be required for non-resident owners and if you actually have employees. IANAL so do your own due diligence.

    http://www.oregon.gov/dor/bus/pages/corp-scorp.aspx
    http://www.oregon.gov/dor/bus/pages/faq-corp.aspx


  • Thank you so much!
  • edited April 2015
    Liability is about being sued.. If you set up an entity... LLC or S-corp.. and keep separate books for it... any lawsuit or debt that follows from the entity's business is limited to the assets of the entity... A sole proprietor puts all of their personal assets at risk... How much of a concern this should be to you depends on the risk of your business (Are you doing something that could create a liability? Building a house is a higher risk than being a grantwriter...) and the value of your personal assets..

    The NOLO books series, particularly the volumes by Anthony Mancuso, are really helpful guides to setting up entities... No doubt the books are at your the local library... NOLO is also online..

    (LLCs are easier and more flexible to administer. They pay no income tax themselves.)
  • edited April 2015
    I've always thought s-corp for personal/family and LLC/P if you need/want many partners, but I've fumbled my way through this stuff and haven't had an indy job in years.

    To be clear the liability insurance I'm talking about (if that's even the right term) is just to satisfy the employer, for example if you're an independent programmer that wants to be hired by Nike on a corp-to-corp basis they're going to require that your org has some sort of liability insurance.
  • Judar, I want to buy some shares in your corp!
  • The S-corp is to have the option to issue stock to many holders. The LLC is the solo or closely held. So reverse of FTP. In Oregon, there is a minimum annual corporate tax due on April 15 of $150. The annual corporate registration with the Secretary of State is $100. There are City of Portland and Multnomah County business taxes. Set up a separate bank account at the credit union for the corp and keep books. Insurance - I have found that some clients need general liability insurance, if you trip and fall on their property or someone trips over your laptop cord. Professional liability insurance is difficult to get - you advise the client to do X and the world blows up, so they sue you for a trillion bazillion dollars. There are state laws which come into play on that, and since I couldn't find, did not get. Cover that in your contract with the client, the sticky wicket in contracts are the penalties, avoid penalties to you and include penalties to them, as you can.
  • In Oregon, there is a minimum annual corporate tax due on April 15 of $150. The annual corporate registration with the Secretary of State is $100.

    If I'm a sole proprietor, I don't pay these - right?

    I think I'm just going the sole proprietor route for now.

    Thanks everyone!!
  • I do Sole Proprietor for my freelance stuff and I don't pay those taxes. There are a couple of weird county/Trimet ones though, although I do so little freelance that I usually don't end up owing those anymore.
  • Everyone needs to file as a Corporation so that I can buy a few shares in your business.
  • edited April 2015
    I have always found the Oregon Corporation Division helpful on the phone and the wait is usually minimal. They are 503-986-2200. My reading is that sole proprietorships do not even need to register unless operating under a fictitious name ("doing business as"). I have another structure, so can't advise on sole proprietorship. City of Portland/Mult Co taxes/filing kick in at $50K revenue, with provisions for exemption filing. There is a City website for that. There could also be TriMet tax involved.
  • The Oregon Volunteer Lawyers for the Arts has a talk about legal structures for artists on May 26 lunchtime PSU $10 - http://oregonvla.org/events/. Some of this would apply to freelancers.
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