» Protecting Your Ideas
» Registration, Zoning, Licensing and Taxes
     » Step One: Choosing the Right Legal Structure
     » Step Two: Fictitious Name
     » Step Three: State Licensing
     » Step Four: Federal Employer Identification
     » Step Five: Federal, State and Local Taxes and Reporting Requirements
     » Step Six: Local Licensing
» Insurance

Patents
Original machines, technical processes or methods, manufactured items, and chemical compositions may be patented. “Utility patents,” for inventions with movable parts, remain in effect for 20 years; “design patents” are effective for 14 years. The key elements of patent applications are “claims” which describe all essential features that distinguish the new invention. For information contact: U.S. Patent and Trademark Office, (800) 786-9199 www.uspto.gov

Trademarks
Words, symbols, names, interest domain names, packaging and labeling that distinguish one business’ products from another business’ products. Although registration provides greater protection, trademarks that are not registered still legally protect owners. A trademark or service mark may be registered through the U.S. Patent and Trademark Office or for more limited state protection, with the Florida Department of State, Division of Corporations. For information contact: (800) 786-9199 or (850) 488-9000. www.uspto.gov or www.sunbiz.org

Copyrights
Original writing, musical works, artistic designs and other works of expression are protected under federal copyright law, which gives the author exclusive rights to use the works. For information contact: U. S. Copyright Office, (202) 707-3000. Download forms and search copyright records at www.copyright.gov.

Step One: Choosing the Right Legal Structure
To get a business up and running, you must first decide on its legal structure. The choice determines what kind of taxes the business must pay, who is liable, and what forms to file. Out-of-state corporations are considered foreign corporations and need to file incorporation documents to do business in Florida. The following are brief definitions of legal structures. It is recommended you consult with an attorney or accountant to determine the best structure for your business. To find an attorney best suited to your needs call the Lawyer Referral Service of the Collier County Bar Association, (239) 774-8711, www.colliercountybar.org/programs.htm

Corporations (“C” and “S”)
There are two types of corporations, the traditional “C-Corporation” and an “S-Corporation”. With a C-Corporation, the corporation rather than the individual pays taxes and assumes liabilities. The shareholders own the corporation. A corporation may have an unlimited number of shareholders, either as individuals, partnerships, trusts or separately incorporated corporations. Florida has a 5.5% corporate tax.

An S-Corporation allows up to 75 shareholders to share income and expenses and to report them on their individual income tax returns. In essence, the S-Corporation does not pay federal corporate income taxes, thereby eliminating the double taxation feature of standard “C” corporations. S-corporation parties may be deducted and or a personal income tax return.

Articles of incorporation must be prepared and executed in compliance with the “Florida Business Corporation Act” (Chapter 607, Florida Statutes) and filed with the necessary fees and taxes to the Florida Department of State.

General Partnerships
A partnership exists when two or more persons join together in the operation and management of a business venture. Partnerships, like sole proprietorships, are subject to relatively little regulation and are fairly easy to establish. Under a general partnership, each partner is liable for all debts of the business. All profits are taxed as income to the partner based on the percentage of ownership. The downside of a partnership is that each partner has unlimited personal and financial liability without the protection of a corporation.

Limited Liability Companies (“LLCs”)
An LLC combines selected corporate and partnership characteristics while still maintaining status as a legal entity distinct from its owners. As a separate entity, it can acquire assets, incur liabilities and conduct business. As the name implies, however, it provides limited liability for the owners. LLC owners risk only their investment. Personal assets are not at risk.

Corporations, Partnerships and LLCs Must File With:
Florida Department of State
Division of Corporations
P.O. Box 6327
Tallahassee, FL 32314
(850) 245-6052
www.sunbiz.org - filing may be done online

Sole Proprietorships
Easy to set up and easy to disband. The profits are taxed at the owner’s individual federal tax rate, with the amount reported on Forms 1040 Schedule C or Schedule C-EZ. Sole proprietorships do not file Florida corporate income tax returns, but owners have unlimited personal liability for any debts or other obligations the business incurs. In Florida, the state’s Homestead Rights laws limit liability, preventing creditors from seizing an owner’s home. To understand the federal income tax implications of the above legal structures, the following Internal Revenue Service publications are available online:

Corporations: www.irs.gov/pub/irs-pdf/p542.pdf (Publication 542)
Limited Liability: www.irs.gov/pub/irs-pdf/p3402.pdf (Publication 3402)
Partnerships: www.irs.gov/pub/irs-pdf/p541.pdf (Publication 541)
Sole Proprietorships: www.irs.gov/taxtopics/tc408.html

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Step Two: Fictitious Name
A Fictitious Name registration is required of individuals who do business under any name other than their legal personal name or under a properly registered corporate name, partnership, trademark or service mark. Applicants may contact the Division of Corporations or check the website for a complete index to see if the name is already in use. (Keep in mind that if you are going to put your business on the web, you may want a business name that is also an available website domain name. You can easily check this by searching for your proposed “.com” name.)

Exemptions from filing of a fictitious name are: applicant is a licensed attorney forming a business for the practice in Florida; applicant is registered with the Department of Business and Professional Regulations and licensing board has not imposed requirements for the registration of a fictitious name; applicant is a corporation or limited partnership filed and in good standing with the Florida Division of Corporations and is not conducting business under any other name; applicant is a federally chartered corporation and is not conducting business under any other name; and applicant is using their full name in the title and they are the only owner. If a change of business ownership occurs, the owners must file a cancellation and re-registration within 30 days of the change.

Contact:
Florida Department of State
Division of Corporations
P.O. Box 6327
Tallahassee, FL 32314
(850) 245-6052
www.sunbiz.org

Fictitious name applications can be filed online or are available for download from the above website.

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Step Three: State Licensing
Florida requires state licenses or certificates of competency for many professions and occupations, ranging from hairdressers to accountants to day care workers. Many require special training and prior examinations. The Florida Department of Business and Professional Regulations has jurisdiction over most occupations, but some fall under the jurisdiction of other state agencies.

For information contact:
Department of Business and Professional Regulation
Customer Contact Center
1940 N. Monroe St.
Tallahassee, Fl 32399-1027
(850) 487-1395
www.myfloridalicense.com or
www.myflorida.com/dbpr

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Step Four: Federal Employer Identification
All businesses, with the exception of most sole proprietorships, must obtain a Federal Employer Identification (EIN) from the Internal Revenue Service. Taxpayers can obtain an EIN immediately by calling the Business & Specialty Tax Line (800) 829-4933. An assistor takes the information, assigns the EIN, and provides the number to an authorized individual over the telephone.

This registration is required even though a business may not have employees. An SS-4 form can be completed online by going to www.irs.gov and looking for Employer ID Numbers under the section Business, and once an EIN is successfully submitted the EIN is assigned. Taxes on your business and other federal or state reporting requirements will depend on the nature of the business, its form of legal structure, and whether or not there are employees.

For more information you can also contact the local IRS office here:

Taxpayer Assistance Center
2891 Center Point Drive
Fort Myers, FL 33916
(239) 938-7601

Another useful website, provided by the government and will help you dissect all the Federal requirements, is www.business.gov.

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Step Five: Federal, State, Local Taxes and Reporting Requirements

FEDERAL- Internal Revenue Service (IRS)

Federal Corporate Income Tax
(Due: March 15, if the business’ fiscal year corresponds to the calendar year)
C-Corporations pay income tax using federal Forms 1120 or 1120A.
A Limited Liability Company classified as a corporation for federal tax purposes must file a federal corporate income tax form. An S-Corporation generally is not liable for federal income tax, but it must file a federal Form 1120S annually and pay tax on certain investment income and capital gains. Returns are due by the 15th day of the third month after the close of the corporation’s fiscal year.

Federal Unemployment Tax
(Dates Due: January 31, April 30, July 31, October 31)
Businesses that have paid $1,500 in wages within a calendar quarter or have employed one person for any portion of a day in 20 different weeks during the calendar year must file quarterly federal tax returns. The tax rate is 6.2% on the first $7,000 of wages, but you can take a credit for the amount paid in state unemployment tax up to 5.4%, which is the maximum rate in Florida.

In most cases the tax is paid quarterly, either by the Electronic Federal Tax Payment System (required if deposits total more than $200,000 annually) or by using Form 8109, Federal Tax Deposit Coupons. Report the tax annually on federal Forms 940, 940-EZ or 940-PR (Spanish).

The local IRS office is located at:
Taxpayer Assistance Center
2891 Center Point Drive
Fort Myers, FL 33916
(239) 938-7601
Business tax questions: (800) 829-4933
Forms Distribution Center: (800) 829-3676 www.irs.gov/businesses/index.html.

A guide for employer taxes is available on the IRS website under Publication 15-A, “Employer’s Supplemental Tax Guide.”

Federal Immigration Reform and Control Act
Requires all employers to verify the employment eligibility of new employees. The law obligates an employer to process Employment Eligibility Verification Form I-9. Filing for I-9’s online is available at www.uscis.gov/graphics/formsfee/.

Safety and Health Regulations
All businesses with employees are required to comply with state and federal regulations regarding the protection of employees. OSHA outlines specific health and safety standards adopted by the U.S. Department of Labor. For information contact the Federal Occupational Safety & Health Administration, Department of Labor at (813) 626-1177 (Tampa) or visit them online at www.osha.gov/dcsp/smallbusiness

STATE- Florida Department of Revenue (DOR)

Florida Corporate Income Tax
(Due: April 1)
Corporations doing business in Florida are subject to the 5.5% tax. C-Corporations pay the tax on Form F-1120. If the business owes less than $2,500 in tax, shows net income of $45,000 or less and conducts all business in Florida, it may file the short form F-1120A. Limited Liability Companies classified as a corporation for federal tax purposes must file a Florida corporate income tax return. An S-Corporation in Florida files Form F-1120 corporate income tax return for the first year it does business in the state, and answers the form’s information questions. Unless there is federal taxable income at the corporate level, no state filing is required for subsequent years as long as the S-Corporation does not owe federal tax.

Florida Intangible Personal Property Tax
Florida corporations and individuals who control intangible personal property (such as stocks, notes, bonds, mutual funds and leases) must file an annual Intangible Personal Property Tax Return (Form DR-601C for corporations and DR-601I for individuals). Accounts receivable not arising from a company’s normal course of trade or business is also taxable. There is a $250,000 exemption for businesses, and the minimum payment is $60. Visit www.myflorida.com/dor/taxes/ippt.html for more information.

Florida Sales and Use Tax
(Due: The first day of each month for 12 consecutive months)
Florida businesses must collect the 6 % sales tax for many products and services and must have a Sales Tax Number, which can be obtained by filing Form DR-1. Owners of service businesses should check with DOR to find out if they must pay and when. If DOR tells you your service is not taxable, it is a good idea to get it in writing. The Florida Department of Revenue issues certificates and monthly payment booklets.

Form DR-15 Sales and Use Tax Report is used to report and pay monthly the state sales tax collected. Businesses that file $1,000 or less per year, however, may file quarterly. If a business files $500 or less annually in sales and use tax, it may file semiannually. If $100 or less, it may file annually. When the report and payment are submitted correctly and on time, the dealer receives a collection allowance. Businesses must use e-filing if they pay $30,000 annually in sales and use tax at www.myflorida.com/dor

Florida Unemployment Tax
(Dates Due: January 31, April 30, July 31, October 31)
Businesses are required to report wages and pay taxes to the Unemployment Compensation Program if they paid $1,500 in wages within a calendar quarter, have employed one person for any portion of a day in 20 different weeks during the calendar year, or are liable for federal unemployment tax (FUTA) because of employment in another state. (A business owner who is the only employee must pay taxes on his or her own wages if the business is a corporation.) The initial tax rate for new employees is 2.7% for the first 10 calendar quarters, at which time the business will receive a computed tax rate. The minimum tax rate allowed by law is 0.3.5%, the maximum is 5.4%.

Unemployment taxes must be paid on the first $7,000 of wages paid to each employee per year. Taxes are paid quarterly on Form UCT-6 to the Florida Department of Revenue. Businesses that pay taxes on 10 employees or more in any calendar quarter must use e-filing at www.myflorida.com/dor

Florida Use Tax on Out-Of-State Purchases
(Date Due: 1st day of month following the quarter in which the purchase was made)
This tax applies to items purchased out-of-state from internet sites, mail order catalogs, auctions, shopping networks or toll-free shopping services. It is also imposed on items purchased during out-of-state travel when the merchandise is shipped to the individual’s home or business location in Florida. Form DR-15MO is used to make payment.

For all of the above Florida Department of Revenue functions, the local DOR office is located at:

Naples Service Center
Florida Department of Revenue
3073 Horseshoe Dr S, Suite 110
Naples, FL 34104-6145
(239) 434-4858 (ET)

Florida New Hire Reporting Office
Employers are required to provide information within 20 days on all newly hired full-time and part-time employees who reside or work in the State of Florida to whom the employer anticipates paying earnings. Employees should be reported even if they work only one day and are terminated (prior to the employer fulfilling the new hire reporting requirement).

Employers must also report rehires, or employees who return to work after being laid off, furloughed, separated, granted a leave without pay, or terminated from employment. Employers must also report any employee who remains on the payroll during a break in service or gap in pay, and then returns to work. This includes teachers, substitutes, seasonal workers, etc. For information contact:

Florida New Hire Reporting Center
P.O. Box 6500
Tallahassee, FL 32314-6500
(888) 854-4791
(850) 656-3343
www.fl-newhire.com

Florida Department of Financial Services, Division of Workers’ Compensation
If a business has four or more full or part-time employees, workers’ compensation coverage is required. Construction contractors with one or more full-time or part-time employees must purchase coverage. The premium is determined by applying various hazard rates to specific job classifications based on the employer’s annual payroll. All construction related businesses should contact the Department to determine specific coverage requirements. Workers’ compensation coverage can be purchased through any number of commercial insurance carriers and group/commercial self-insurance funds. In addition, business owners may self-insure if they fulfill certain financial requirements. For information contact:

Florida Department of Financial Services
Division of Workers’ Compensation
Office of the Director
200 East Gaines Street
Tallahassee, FL 32399-4220
(850) 413-1601 or
www.fldfs.com/wc

COLLIER COUNTY– Collier County Tax Collector

Tangible Property Tax
Property Tax Reports require that all tangible property be reported each year to the Property Appraiser’s Office. Anyone in possession of assets on Jan. 1 who has a proprietorship, partnership, corporation or is a self-employed agent or contractor must file each year. Property owners who lease, loan or rent property must also file. All assets used in a business or rental activity physically located in Florida are considered tangible personal property. More specifically, furniture, fixtures, tools, machinery, household appliances, equipment, signs, leasehold improvements, supplies, leased equipment and anything else used to generate income are considered taxable as well. For information contact:

Collier County Appraiser’s Office
Collier County Government Center
3285 Tamiami Trail E.
Naples, Fl 34112-5758
Customer Service: (239) 774-8141
Tangible Property: (239) 774-8145
www.collierappraiser.com

OR

Collier County Tax Collector
Collier County Government Center
3301 Tamiami Trail East Building C-1
Naples, FL 34112-4997
(239) 774-8171

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Step Six: Local Licensing
All businesses, no matter where they are located, must have zoning approval. Check with city or county zoning offices (telephone numbers are listed under below) to determine appropriate business zoning and business uses for a particular business location (including residential locations). In addition, some locations may require the payment of impact fees if the prior use is not compatible.

Once zoning approval has been obtained, occupational licenses are required for all businesses and are issued by both the cities and the county. The local occupational license grants the privilege of engaging in or managing any business, profession or occupation within Collier County. Certificates of Use and/or zoning permits are also required to operate a business in particular areas and give authorization to occupy a particular location

Zoning
The City of Naples and Collier County both require that new businesses meet building and zoning requirements, as well as a fire inspection. Send the address of your proposed business to the City of Naples Finance Department to determine if it is in the City of Naples proper. If your business is not located inside the city of Naples, you will not need a city license, however, you may still need a state license and you will always need a county occupational license when operating in Collier. In order to determine your business’s compliance with all zoning requirements contact:

Zoning for City of Naples:
Zoning Department
City of Naples Building and Zoning Department
295 Riverside Circle
Naples, FL 34102
(239) 213-5049

Zoning for Collier County:
Collier County Comprehensive Planning Services
2800 North Horseshoe Drive
Naples, Fl 34104
(239) 403-2400 ext. 5603
www.colliergov.net/compplanning

Collier County Fire Inspections:
If you open your business at a commercial location you will also need to have your building inspected by the local fire department. Contact your local fire department to set up an inspection time. At the end of Appendix I is a list of contacts for Collier County Fire Departments.

Municipal Licensing
A state license may be needed prior to applying for a city license, so check with either the state to find out if you need one. Fill out license application form. Forms are available from the City Finance Department office or from their website but must be filed in person. For more information please refer to www.myfloridalicense.com

If you are not in the City of Naples, the City of Marco Island, or Everglades City proper you do not need a city license and need only apply for the county license (and possibly a state license).

Naples
Occupational License Department
City of Naples Finance Department
735 Eighth Street S.
Naples, FL 34102
(239) 213-5020
www.naplesgov.com/finance/occupational_license.asp

Everglades City
102 Broadway Avenue
Everglades City, Fl 34138
(239) 695-3781

Marco Island
Community Development Department
950 N. Collier Blvd., Suite 308
Marco Island, Fl 34145
(239) 389-5000
www.cityofmarcoisland.com/public_documents/marcoislandfl_forms

County Licensing
County Occupational License
Required for all areas in Collier County. If the business is located in the city of Naples, Marco Island, or Everglades City, a county occupational license must be obtained after the issuance of a municipality license, and a copy of the municipality license must be provided. The occupational licenses can be obtained at:

Collier County Tax Collector:
Occupational Office
2800 North Horseshoe Drive, Suite 210
Naples, Fl 34104
(239) 403-2477
www.colliertax.com
occupational@colliertax.com

A list of the Collier County Tax Collectors Office branch locations can be found on their website: www.colliertax.com

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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.

Help
For help setting up an insurance plan for small businesses the Florida Department of Financial Services has put a guide on their website. To download and read the guide (or other insurance guides) go to: www.fldfs.com/Consumers/publications.htm#business