Small Business Week typically takes place in the first week of May each year, but as with, well, everything else over the past year and a half, it was postponed and is now being celebrated this week. There is nothing inherently necessary about that May date anyway, and it can always be a good time to think about a small business, so let’s join in the festivities.
Know that is even possible to starting thinking about a small business without actually having a business. Everything has a starting point after all. I think the biggest thing here is to have a passion for something you want to do. Have you ever had a tickle of an idea that you thought could become a business? That spark that you knew could be profitable if someone would just do it? Well, that probably came out of something you would like to do and when it comes to work, the things you want to do are going to thrive more than the things you need to do. So lean into it, identify that opening you saw, and think about how you could fill it.
As a quick tip, once you actually decide to pursue something as a business (even if you don’t envision it ever being more than a side hustle), set up a new bank account for it. This doesn’t have to be any special type of account and can likely be accomplished in minutes with your current bank. Keeping your business and personal spending separate, though, will fend off the headache of going through lists of transactions and determining what was what months down the road.
For those who try to make the transition from side hustle to business, the biggest hurdle can be getting from doing those things you want to doing the things you need to do. This can be as simple as properly forming the business legally, keeping a bank account balanced, paying the right taxes, or knowing whether you are actually making a profit. All of these are things that one understands need to happen on some level, but they aren’t why you start the business, and they aren’t what you know about. So when it comes to them, do not shy away from seeking out help from those who do know such things.
So to that end, know that the federal government runs a Small Business Administration, which shares a lot of information on its website at sba.gov. For more strictly tax-related issues, the IRS has put together a website in celebration of this week that offers up some information. And as always, if there is anything we can do to help facilitate your success, do not hesitate to reach out.
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To ensure we don't make the folks at the IRS ornery, we inform you that any U.S. federal tax advice contained in this communication (including any attachments) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing, or recommending to another party any transaction or matter addressed herein.