Tax and business info
Mon, Aug 30 2004 — Comments (10) |
This is the part of the show that’s a drag, but we all have to do it – filing for a business license and paying taxes (yes, even for a DIY-style craft fair). Note: There have been some changes since last year’s show on the tax forms you’ll need to submit as a vendor.
We all are required by law to file for a business license and pay sales tax.
I know its a groaner, but it is fairly simple to fill out the forms, and it is free.
First, go to the Illinois business tax website and print, fill out, and mail the REG-1 (formerly the NUC-1) and print or at least read the REG-1 Instructions. You're filing for an Illinois Business Tax number or IBT number. Here’s a handy FAQ.
You may be able to file online if their website recognizes your browser.
It can take about 3 weeks to get your number and your information so make sure you do it early enough.
Sales tax is paid when you file form ST-1 which can be downloaded in pdf form here.
You will also have to pay federal tax on a quarterly basis. This page has more information.
Since we won't have someone from the state collecting sales tax from vendors, and since we aren't responsible for collecting taxes (thank God!), we aren't going to be going around asking everyone to show their info. Y'all are adults and how you handle this is up to you. We're more than willing to put up links and other info as we come across it, but we're not experts and we're not tax lawyers and we're not accountants so please understand that our info could be wrong, and you should do your own research.
Another option: If you are not planning to do another craft fair after DIY or you don't want to start your own business, you can file what's known as a "first and final" return for your taxes after the DIY Trunk Show.
For example, last year I developed some new personal commitments (i.e., grad school) that take up too much of my time to try to run a jewelry business on the side right now. And I really didn't want to have to deal with the tax implications of starting a business that I don't have the energy to run. So the 2003 DIY Trunk Show was the only show I’ll be participating in for a long time.
If your situation is similar, you may want to get a "first and final" return, which requires you to get a Tax ID number but not a business licence.
(If you're not sure what you want to do with your crafty self in the future, or you think you'll do another show, you should probably just go ahead and get the business license just to be safe.)
Here's what you need for a "first and final" return:
First, fill out and submit the REG-1 form to get your Tax ID number.
Then, call the Illinois Department of Revenue's Business Hot Line (217-524-4772) and ask them to send you the "first and final" return forms. These forms are not available online.
After the show is over, complete and submit the "first and final" return before Dec. 20.
If you have any questions, the Business Hot Line people are very friendly and helpful.
If any of the seasoned craft-show veterans have any helpful tips for the newbies, please leave a comment.
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