In: Accounting
Myers Publishing is a Canadian corporation with its principal offices in Calgary. It sells a line of teenage romance novels that has become quite popular with high school students around the world. The books were sold to U.S. residents via online purchase. So as to increase sales in the U.S., Myers wants to establish relationships with booksellers such as Barnes and Nobel, and Books A Million. It also wants a reliable source of books available in the U.S. so it wants to establish sales offices and warehouses throughout the U.S. You are a U.S. tax advisor to Myers and Myers asks that you explain the following:
What criteria are necessary in order to establish a trade or business in the U.S.
Staring a business in new country may be a difficult task. However the major requirements for starting up new business are:
1. REGISTERED BUSINESS NAME & REGISTERED ADDRESS :
The state or local government need a name of the business name and address with which it can establish various communication. You can register name as DBA(Doing Business As) or FBN(Fictitious Business Name)
2. REGISTRATION WITH IRS FOR FEDERAL TAXES
A corporation doing business in US would require registration with IRS which will allot Employee Identification Number(EIN). It can be used for all tax purposes such return filing, tax payment etc.
3. REGISTRATION FOR STATE AND LOCAL TAXES
It need to register for various taxes such as Employment Taxes, Sales Taxes, Property Taxes etc. It can vary from place to place.
4. PERMITS AND LICENCES FOR OPERATIONS
For doing certain business, you need to obtain permits or licences from its apex licensing authority. It may be a time consuming task.
5.OTHER LAWS AND REGULATION
A business has to comply with various other laws and regulations such as Foreign Exchange Laws, Corporation, Banking and Insurance Laws, Insolvency and Bankruptsy laws etc.