General Information & Resources
Below are our two most popular information pieces; our marketing packet, filled with information on Stafford and our Interactive Guide to Starting Your Business in Stafford, which provides a wealth of entrepreneurial resources. The text sections below them can serve as a checklist of the most common requirements that affect small businesses, but it is by no means all inclusive.
Please bear in mind that regulations vary by industry. If you're in the food service business, for example, you will have to deal with the health department. If you use chemical solvents, you will have environmental compliance to meet. Carefully investigate the regulations that affect your industry. Being out of compliance could leave you unprotected legally, lead to expensive penalties, and jeopardize your business.
CERTIFICATE OF OCCUPANCY If you are planning on occupying a new or used building for a new business, you may have to apply for a Certificate of Occupancy from a city or county zoning department. For more information contact the county or city office in your area.
BUSINESS ORGANIZATION There are many forms of legal structure you may choose for your business. The most common structures are Sole Proprietorships, General and Limited Partnerships, C and S Corporations and Limited Liability Companies. Each legal structure offers organizational options which are appropriate for different personal situations and which affect tax and liability issues. We suggest you research each legal structure thoroughly and consult a tax accountant and/or attorney prior to making your decision. For additional information and Pro’s and Con’s regarding the different business entities, click here.
FICTITIOUS OR ASSUMED BUSINESS NAME Businesses that use a name other than the owner's must register the fictitious name with the county's Clerk of the Court as required by the Trade Name Registration Act. This does not apply to corporations doing business under their corporate name or to those practicing any profession under a partnership name. For more information, click here.
TAX INFORMATION Business owners are required by law to withhold the following from the wages paid to employees: federal income taxes, state income taxes and FICA (Social Security) Insurance. Income taxes will also be levied by the federal and state governments on earnings of any business. Therefore, each business must file an income tax return with both agencies. Businesses may be required to file estimated tax returns and pay estimated taxes on a quarterly basis. The Internal Revenue Service (IRS) has a number of publications that are available upon request to small businesses. One of the most helpful is Your Business Tax Kit, which includes data and forms for a Federal Employer Identification Number and a tax guide for small businesses that can be ordered by calling Forms and Publications at (800) 829¬3676 or through a visit to your local IRS office. You may want to contact your local Social Security Administration Office for (FICA) Insurance information. For State tax information, call your state government.
FEDERAL SELF EMPLOYMENT TAX Everyone must pay Social Security Tax. If you are self-employed, your Social Security contribution is made through the self-employment tax. You will need to calculate how best to report earnings and pay your business taxes. Contact the IRS at (800) 829-1040, visit your local IRS office go to the Official IRS Website for more information. The IRS may seem like a complicated maze, but there are publications, counselors and workshops available to help you sort it out.
BUSINESS INSURANCE Like home insurance, business insurance protects the contents of your business against fire, theft and other losses. Contact your insurance agent or broker. It is prudent for any business to purchase a number of basic types of insurance. Some types of coverage are required by law; others simply make good business sense. The types of insurance listed below are among the most commonly used and are merely a starting point for evaluating the needs of your business.
- LIABILITY INSURANCE Businesses may incur various forms of liability in conducting their normal activities. One of the most common types is product liability, which may be incurred when a customer suffers harm from using the business product. There are many other types of liability, which are frequently related to specific industries. Liability law is constantly changing. An analysis of your liability insurance needs by a competent professional is vital in determining an adequate and appropriate level of protection for your business.
- PROPERTY There are many different types of property insurance and levels of coverage available. It is important to determine the property you need to insure for the continuation of your business and the level of insurance you need to replace or rebuild. You must also understand the terms of the insurance, including any limitations or waivers of coverage.
- BUSINESS INTERRUPTION While property insurance may pay enough to replace damaged or destroyed equipment or buildings, how will you pay costs such as taxes, utilities and other continuing expenses during the period between when the damage occurs and when the property is replaced? Business Interruption (or "business income") insurance can provide sufficient funds to pay your fixed expenses during a period of time when your business is not operational.
- "KEY MAN" If you (and/or any other individual) are so critical to the operation of your business that it cannot continue in the event of your illness or death, you should consider "key man" insurance. This type of policy is frequently required by banks or government loan programs. It also can be used to provide continuity in operations during a period of ownership transition caused by the death or incapacitation of an owner or other "key" employee.
- AUTOMOBILE It is obvious that a vehicle owned by your business should be insured for both liability and replacement purposes. What is less obvious is that you may need special insurance (called "non-owned automobile coverage") if you use your personal vehicle on company business. This policy covers the business' liability for any damage which may result for such usage.
- OFFICE AND DIRECTOR Under some circumstances, officers and directors of a corporation may become personally liable for their actions on behalf of the company. This type of policy covers this liability.
- HOME OFFICE If you are establishing an office in your home, it is a good idea to contact your homeowners' insurance company to update your policy to include coverage for office equipment. This coverage is not automatically included in a standard homeowner's policy.
SALES TAX NUMBER In your state there is a percent sales and use tax which applies to the retail purchase, retail site, rental, storage, use or consumption of tangible personal property and certain services. In other words, sales tax must be collected on just about every tangible item sold. A sales tax number is required for each business before opening. The number, plus instructions for collection, reporting and remitting the money to the state on a monthly basis, can be obtained from your state government. Click for form.
UNEMPLOYMENT INSURANCE TAX
Employers are liable for unemployment tax in Virginia if they are liable for Federal Unemployment Tax. Also, they are liable if they have had an employee for 20 weeks or more during a calendar year or have had a quarterly payroll of $1,500 or more. Additionally, if you acquire a business that is liable at the time of the acquisition, you are liable.
The taxable wage base in Virginia is the first $8,000 that each employee earns per year. Go to your state home page to check the figures for your state. Unemployment insurance must be reported and returns made to the state.
IMMIGRATION ACT The Federal Immigration Reform and Control Act of 1986 requires all employers to verify the employment eligibility of new employees. The law obligates an employer to process Employment Eligibility Verification Form I-9. The Immigration and Naturalization Service Office of Business Liaison offers a selection of information bulletins and live assistance for this process through the Employer Hotline. In addition, INS forms and the Employer Handbook can be obtained by calling the Forms Hotline. For Forms: (800) 870-3676 Employer Hotline: (800) 357-2099
HEALTH AND SAFETY The Federal Occupational Safety and Health Administration (OSHA) outlines specific health and safety standards employers must provide for the protection of employees. The Virginia Department of Labor and Industry administers and enforces the Commonwealth of Virginia's occupational safety and health programs, payment of wage statute, right-to-work and child labor laws, fosters worker apprenticeship programs, and certifies the safe operation of commercial boilers and pressure vessels.
WORKERS' COMPENSATION If a business employs three or more people, workers' compensation insurance must be carried to provide protection to those injured in on-the-job accidents. The Virginia Workers' Compensation Commission aids people who need claim assistance.
MINIMUM WAGE Virtually all business entities are subject to the federal minimum wage, overtime and child labor laws. Information on these laws and other federal laws, may be obtained from the VA Department of Labor & Industry.