A couple of years ago, I was in the market for a business credit card, so I applied for an American Express card that was offering a $250 signup bonus (sadly, that offer has long since expired). While this card was perfectly serviceable, I occasionally run into places that wouldn’t accept AmEx, and I also wasn’t crazy about the $125 annual. I ultimately cancelled it.

After that, I applied for a Discover Business card. I was once again enticed by a generous signup bonus, but I ultimately ran into similar problems regarding card acceptance. There are a few key places around town that won’t accept anything but Visa or MasterCard. Thus, I’m once again in the market for a business credit card.

Features of the ideal business credit card

My needs are simple. I want a cheap, widely accepted card — thus, I’m looking for a Visa or MasterCard. I also don’t carry a balance, so the APR is a non-issue. I’m more interested the annual fee (or lack thereof). Rewards are great, but my business expenses aren’t actually that high, so they’re not a huge deal.

The best business credit card — for me

As of right now, the most attractive business credit card out there for my needs appears to be the new AT&T Universal Business Rewards credit card from Citi. Most importantly, this is a Visa card and there’s no annual fee. The rewards also match up fairly well with my relatively meager spending.

For example, I’ll get 5 ThankYou points for every dollar spend on AT&T products/services (currently DSL and phone; also considering an iPhone) as well as 3 ThankYou points per dollar spent at gas stations, office supply stores, and on professional services (like legal and accounting). All other purchases qualify for one point per dollar spent. While points aren’t quite as good as cash, I can trade them in for gift cards at stores that we frequent.

Oh, and for those that are looking for a bit of interest-free financing, there’s a six month introductory period with 0% APR on purchases.

Follow me on Twitter!

---
Related Articles at fivecentnickel.com:

» Establishing Credit With a New Taxpayer Identification Number
» Applying for a Business Credit Card
» The Convenience of Using a Debit Card
» AmEx Credit Card Signup Bonus Disappearing Soon
» Signup Bonuses for Business Credit Cards (Anyone can Apply)
» What’s Your Favorite Credit Card?
» The Best Cash Back Reward Credit Cards for Buying Gas
» Using Credit Cards to Post Bail

Yikes! I just realized that I forgot to pay the 4th quarterly installment of our 2008 estimated taxes, which were due on January 15th. After the initial panic subsided, I did a bit of digging and was relieved to find out that it’s really not a big deal. Here’s the straight dope from Fairmark.com:

Penalty for Underpayment

What happens if you don’t pay enough, or don’t pay soon enough.

If you don’t pay enough estimated tax, or don’t pay on time, you’ll have to pay a penalty. It’s best to avoid this penalty, of course — but you don’t have to lose sleep over it. The penalty is equivalent to nondeductible interest on the amount you underpaid, for the period of the underpayment. If you underpay only a small amount, or you correct the underpayment quickly, the penalty will be small.

Based on that, it looks like we’ll be on the hook for two days of interest, which shouldn’t be a big deal. In fact, I’ve heard that the IRS doesn’t even bother billing for this if the amount is small enough. That makes sense, I guess, as it costs them money to print and mail an invoice and then handle the payment when it comes in.

Note that you’re exempt from penalties on a late Q4 payment if you’ve already paid in at least as much as your previous year’s total tax bill, or if you file your taxes and pay the full amount due by February 2, 2009.

Follow me on Twitter!

---
Related Articles at fivecentnickel.com:

» Q2 Estimated Tax Payments Due
» Quarterly Taxes Due Friday, June 15th
» Estimated Taxes and Avoiding Underpayment Penalties
» Q2 Estimated Tax Payments Due
» Estimated Tax Payment Reminder
» State and Federal Income Tax Arbitrage
» Letter From the IRS – We Got Audited
» Important 2007 Tax Filing Deadlines

This is just a reminder to anyone out there that’s self-employed, or otherwise has to make estimated quarterly tax payments… Your 2nd quarterly installment is due on June 15th, 2008. Since that falls on a Sunday, you technically have until this coming Monday (June 16th) to get your check in the mail. So… If you haven’t done so already, start getting things pulled together. You don’t want to spend your weekend working on taxes, do you?

Follow me on Twitter!

---
Related Articles at fivecentnickel.com:

» Quarterly Taxes Due Friday, June 15th
» Q2 Estimated Tax Payments Due
» Estimated Taxes and Avoiding Underpayment Penalties
» State and Federal Income Tax Arbitrage
» 3rd Quarter 2007 Estimated Taxes Due
» Important 2007 Tax Filing Deadlines
» Are Unemployment Payments Taxable?
» Estimated Tax Payment Reminder

Just a quick reminder that quarterly estimated tax payments are due this Friday, June 15th. If you have income that’s not subject to withholding (e.g., self-employment, interest, dividends, gains from the sale of assets, rental income, etc.) then you might need to make quarterly payments to avoid an underpayment penalty.

You can either use IRS From 1040-ES or the Electronic Federal Tax Payment System. I’ve always used the former, although I should probably check out the latter. And don’t forget that you might also need to make estimated payments for your state taxes. If you’re looking for a good source of general information on estimated taxes, check out Fairmark.com’s Estimated Taxes 101.

Follow me on Twitter!

---
Related Articles at fivecentnickel.com:

» Q2 Estimated Tax Payments Due
» Q2 Estimated Tax Payments Due
» State and Federal Income Tax Arbitrage
» Estimated Tax Payment Reminder
» Penalty for Paying Quarterly Estimated Taxes Late
» Tax Stimulus Rebate Payment Schedule
» Important 2007 Tax Filing Deadlines
» Estimated Taxes and Avoiding Underpayment Penalties

Last week I asked for help with a somewhat complex tax situation. Here we are a week later, and fortunately I feel as if I have a better handle on the situation. For the finer details, it’s probably best to go back and read my original call for help and then come back here for details on the resolution.

After having read the comments that various people left and researched the situation further on my own, I am more convinced than ever that separate employers means separate 415(c) limits, as outlined in section 415(f) where it talks about aggregating plans. In fact, while one commenter pointed to the Internal Revenue Bulletin from April 30, 2007 as evidence against this view, here’s a snippet from that same bulletin:

Under section 415(f) and these regulations, for purposes of applying the limitations of section 415(b) and (c), all defined benefit plans that have ever been maintained by an employer are treated as one defined benefit plan, and all defined contribution plans that have ever been maintained by an employer are treated as one defined contribution plan.

However, as Tom Geer pointed out, it’s a bit more complex than simply aggregating accounts on a per-employer basis. Indeed, check out IRC 415(k)(4):

Special rules for sections 403(b) and 408
For purposes of this section, any annuity contract described in section 403(b) for the benefit of a participant shall be treated as a defined contribution plan maintained by each employer with respect to which the participant has the control required under subsection (b) or (c) of section 414 (as modified by subsection (h)). For purposes of this section, any contribution by an employer to a simplified employee pension plan for an individual for a taxable year shall be treated as an employer contribution to a defined contribution plan for such individual for such year.

The last bit says that SEP contribution are treated as employer contributions, which I knew going in, but… The first part says that 403(b) plans are to be treated as a defined contribution plan that is maintained by each employer that I have control over. In other words, it’s treated as if it’s associated with my self-employment, and thus the contributions get lumped in with my SEP-IRA contributions and counted against the 415(c) limit associated with me self-employment.

So… I was partially right (and thus partially wrong, of course). Since my 457(b) is pretty much on its own according to IRS guidance, I can stash $15.5k there as well as $45k combined between my SEP-IRA and 403(b). This is seemingly in addition to my employer’s defined contribution plan. While this works out to a bit less than I thought I could stash away at the outset, I’m not one to look a gift horse in the mouth. Thanks to all who chimed in to help sort this out. And, of course, if you have anything more to add, please don’t hesitate to leave a comment.

Follow me on Twitter!

---
Related Articles at fivecentnickel.com:

» 401(k), 403(b), and 457(b) Contribution Limits for 2009
» Help Needed: Multiple Employers and the 415(c) Limit
» Weekly Roundup – 05/25/07
» Roth IRA Contribution Limits: How the ‘Phaseout’ Works
» How Flexible Spending Accounts SHOULD Work
» 401(k) Changes to Encourage Saving
» Limits on Itemized Income Tax Deductions
» Ten Common Income Tax Credits

I have a tax-related question that I’ve been having trouble getting answered, so I thought I’d throw it out here in hopes that someone can provide any insight… Besides, I’ve searched high and low and haven’t been able to find an answer online, so if we can get this sorted out here, it’ll be available for others to stumble across. This question actually first came up in the comments to my article on how to prioritize your retirement contributions and I’ve been struggling with it ever since.

In short, I’ve been planning on making my required contributions to my employer’s defined contribution plan, maxing out both my optional 403(b) and 457(b), and also contributing to a SEP-IRA based on self-employment income. In response to this, a commenter named CPA1298 asked whether or not I’ll bump up against the $44,000 maximum annual retirement plan contribution limit. As I understand it, the limit that he’s asking about applies to “elective deferrals” in the form of both employer and employee contributions, and is defined in section 415(c) of the Internal Revenue Code (IRC), although it’s actually $45,000 (or 100% of pay, whichever is less) for 2007.

Anyway, I didn’t have a good answer to his question, so I started researching it…

For starters, let’s talk about a bit more about my retirement options:

1. My employer’s defined contribution plan. I had two retirement savings options when I started work — a defined benefit plan (a traditional pension) or a defined contribution plan (I chose the latter). In either case, I would be compelled to contribute 5% of my income to the plan of my choice, and my employer also makes additional contributions. This was a one-time, irrevocable decision that had to be made during my first 60 days on the job.

So how does the 415(c) limit apply to this plan?

As I noted above, my understanding is that this limit deals with elective deferrals (but I may be wrong). Since these contributions are compulsory, and made pursuant to a one-time, irrevocable decision, it seems to me that they should not count toward the limit (but I could, of course, be wrong).

2. My optional 403(b) plan. This account is a tax-deferred account much like a 401(k). I am free to contribute up to $15,500 in pre-tax funds in 2007. There is no employer match.

3. My optional 457(b) plan. This is likewise a tax-deferred retirement savings account. Again, I am free to contribute up to $15,500 in pre-tax funds to it in 2007, and I have confirmed that I can participate in both the 403(b) and the 457(b) up to the full amount (i.e., they don’t share a $15,500 limit, so I can defer taxes on up to $31,000 between them). Here again, there is no employer match.

So those are the options that I have at my disposal through my employer. As I’ve noted previously, however, I also have a decent amount of self-employment income from a sole proprietorship totally unrelated to my day job. Thi brings us to…

(4) My SEP-IRA. I can contribute 20% of my net self-employment income (less 1/2 of my self-employment taxes) to this account. Here again, it’s a tax deferred contribution.

As you can see, depending on how things work, I may or may not run into trouble with the 415(c) limit of $45,000. So that brings me to my main questions…

The most important thing for me right now is determining whether or not the 415(c) limit is applied on a per employer basis. If it is, then it seems that I should have two such limits — one for my day job and one for my self-employment. I have read articles suggesting that this is true (including one from TIAA-CREF, but nothing from the IRS themselves), and the IRC guidance also supports this notion, as they say in section 415(f) that plans of related employers must be aggregated when applying that section’s contribution limitations. The implication here seems to be that plans from different employers should not be aggregated.

The other issue relates to my job-related retirement plans… Am I correct in assuming that the defined contribution plan doesn’t count toward the limit since it’s not elective (or at least it doesn’t appear to be based on my understanding of the term ‘elective’)? If not, then I’m in the clear (assuming the SEP-IRA is subject to it’s own 415(c) limit). If so, then what about the 457(b)? The treatment of this sort of plan seems to be different, and I’ve seen claims that 457(b) plans don’t enter into other plan calculations.

Please not that I’m looking for a concrete answer, so if you disagree with me, please do your best to support your view with information from the IRS. Likewise, if you think I’m right, it would be great if you could point out why.

And before anyone suggests that I seek professional counsel, please note that I’ve already contacted our tax attorney about this. I have, however, yet to receive a clear answer on any of it.

Follow me on Twitter!

---
Related Articles at fivecentnickel.com:

» Followup: Multiple Employers and the 415(c) Limit
» 401(k), 403(b), and 457(b) Contribution Limits for 2009
» Weekly Roundup – 05/25/07
» How Flexible Spending Accounts SHOULD Work
» Anniversary Giveaway, Update #2
» 401(k) Changes to Encourage Saving
» Guest Bloggers Needed at Raising4Boys, Too
» Limits on Itemized Income Tax Deductions

Today is not only the deadline for filing taxes, it’s also the due date for the first quarterly estimated tax payment of 2007. Technically, federal income tax is a pay-as-you-go tax, meaning that you’re supposed to pay into the system as you receive income during the year. For a regular job, this usually isn’t a problem, as your tax withholding will take care of it. But in the case of self-employment income (or any other income that isn’t subject to withholding) you’ll need to file estimated taxes.

Estimated taxes can be figured using Form 1040-ES, and you can either pay a lump sum up front, or you can make quarterly payments (see: Important 2007 Tax Filing Deadlines for due dates). The problem here is that, if you don’t pay enough in over the course of the year, the IRS can penalize you.

In general terms, you’ll be subject to an underpayment penalty unless the total of your annual withholding and credits exceeds:

(1) 90% of the total tax owed for the year in question, or
(2) 100% of the tax shown on your previous year’s tax return

That being said, there are circumstances under which #2 becomes 110% of the tax shown on your previous year’s return (see Form 1040-ES for details).

If you’re not going to hit these thresholds via withholding, then you’ll need to make estimated tax payments. Keep in mind that estimated taxes can be paid all at once, or you can choose to file quarterly. But if you file quarterly, the IRS will expect to see approximately equal payments across quarters (although there are exceptions if your income is uneven). Keep in mind that you you don’t necessarily have to pre-pay your full tax bill. Rather, hit the thresholds above and you should be in the clear. Of course, you’ll have to pay the balance due when it comes time to file your taxes next year.

Follow me on Twitter!

---
Related Articles at fivecentnickel.com:

» Quarterly Taxes Due Friday, June 15th
» State and Federal Income Tax Arbitrage
» Carnivals – Week of 05/07/07
» Penalty for Paying Quarterly Estimated Taxes Late
» Q2 Estimated Tax Payments Due
» From the Archives (April 13th – May 3rd)
» Important 2007 Tax Filing Deadlines
» Letter From the IRS – We Got Audited

Now that our taxes are done, I know exactly how much I can contribute to my SEP-IRA for 2006. The great thing about having an account at Vanguard (aside from the low fees) is that they make it so easy to make investment contributions — it literally took about 3 minutes to log in and transfer the funds from our linked bank account to my SEP-IRA. Since I’ll be tracking our self-employment income more closely over the upcoming year, and filing estimated every quarter, I may accelerate my contributions a bit by making them as we go along instead of waiting to contribute the full amount come tax time next year.

Don’t forget to make your 2006 IRA contributions before next Monday!

Follow me on Twitter!

---
Related Articles at fivecentnickel.com:

» Our Lending Club Investments, One Week Later
» How to Prioritize Your Retirement Accounts
» Lending Club Portfolio Fully Funded
» HSBC Account Opening Process Complete
» House Votes to Suspend Required Minimum Distribution (RMD) for 2009
» Lending Club: Invest in Your Friends
» Another Stimulus Check? Second Time is the Charm
» DollarSavingsDirect Savings Account Approved

Given the recent uptick in our income due to my new job and our growing self-employment income, I’ve recently been thinking of ways to reduce our 2007 tax liability. The first step, of course, is to contribute to my employer’s basic retirement plan, which is held at Fidelity. But… I want to do way more than that.

Thus, I opened a Vanguard SEP-IRA and have been making employer contributions to that on my own behalf (these contributions can be made in addition to traditional/Roth contributions – see here for a handy calculator). Another piece of the puzzle has been to open an optional 403(b) (also with Vanguard) and max out the $15,500 contribution limit.

This is all well and good, but I really, really, really hate paying taxes (don’t we all?), so I’d like to do even more. And then it hit me… In addition to the optional 403(b) plan, my employer offers an optional 457(b) plan. The contribution limits for both of these are listed at $15,500 for 2007, and I have always assumed that these two types of accounts share a common contribution limit (i.e., that your total contributions to both couldn’t exceed $15,500).

Guess what? I was wrong. Over the weekend I finally got around to looking into this, and here’s what I learned over at 457bwise.com:

The Economic Growth and Tax-Relief Reconciliation Act of 2001 (EGTRRA) repealed coordination of contributions between 457(b) plans and 403(b) plans [and 457(b) plans and 401(k) plans]. This means that employees with enough includable compensation can contribute the maximum elective deferral limit to both a 403(b) and a 457(b) [and a 457(b) and a 401(k)]. For 2007, this is $15,500 for a whopping total of $31,000. Participants eligible for catch-up provisions can include even more.

Holy cow! I can shield up to $31k from taxes using these two accounts! While I realize that not everyone is in such a favorable position with regard to the availability of such plans, and that not everyone could afford the contributions even if they were, I now have a new goal… Continue making the 5% contribution to my basic retirement account (this comes with a match of a little better than 8%), max out my SEP-IRA employer contributions (20% of net self-employment income), max out my 403(b), and max out my 457(b).

As I’ve noted previously, it’s looking like we’re not going to be eligible for a Roth or deductible traditional IRA contributions this year, so those are currently on the back burner. If we somehow manage to do all of this and still have money to spare, our next step will be to make non-deductible traditional IRA contributions. In case you haven’t heard, the income limits for traditional-to-Roth IRA conversions are scheduled to go away in 2010. Assuming that’s still the case when 2010 rolls around, we’ll be able to convert these funds into our Roth accounts, effectively allowing us to circumvent the contribution income limits.

Follow me on Twitter!

---
Related Articles at fivecentnickel.com:

» links for 2007-04-12
» 401(k), 403(b) and 457(b) Contribution Limits for 2008
» State and Federal Income Tax Arbitrage
» SEP-IRA Funded for 2006
» Roth IRA Income Limits for 2007
» How to Prioritize Your Retirement Accounts
» From the Archives – (March 23rd – March 30th)
» Carnivals – Week of 04/02/07

Not long after registering our LLC, we received a solicitation in the mail from an entity called National Companies Register Corporation (NCRC) asking us to make a payment of $587.00 within the next 14 days. In return, they promised to list our company information on their website at www.companies-register.us (you’ll have to copy/paste to check it out — I’m not giving them a live link). Who cares? Your state maintains the official record of your business, and when I visit NCRC’s site, I’m greeted by nothing more than a login screen with a giant ‘Click Here to Pay’ button.

Let me ask you this… Why would I be interested in having my business listed on their site if the information doesn’t even seem to be publicly accessible? In fact, at the bottom of the solicitation, it says that “You will have access to our online data service by password, which will be sent to you after payment has been received.” Why not at least make their database public so those that get suckered into paying might actually derive some tiny benefit from it? My best guess is that relatively few people have been taken in by their offer, and making a half-empty database publicly viewable wouldn’t be very enticing to potential victims customers.

Interestingly, the National Companies Register Corp. is the subject of a “Consumer-Related Investigation” in the state of Florida. Here’s what they’re accused of:

Mail solicitation that can reasonably be interpreted by consumers as an invoice or statement for goods not yet ordered or services not yet performed that does not contain the required 30 point bold warning mandated by Fla. Statute 817.061.

So… You make the call. Is NCRC a scam? It sure looks like one to me.

Follow me on Twitter!

---
Related Articles at fivecentnickel.com:

» Scammed out of $15k
» Ten New Money Scams, Part 2
» Identity Theft Tops FTC Complaints
» Mid-Holiday Roundup
» Weekly Roundup – 3rd Quarter Taxes Edition
» Weekly Roundup – Mailing Articles Edition
» Is FreeCreditReport.com a Scam?
» Weekly Roundup – Night on the Town Edition

Continuing along the path toward the separation of our business and personal finances, we have are now the proud new owners of a business credit card. I previously posted a list of business credit cards with signup bonuses, and that’s where we started. As a reminder, you don’t have to have an actual business to apply for these cards and take advantage of the — simply use your name for the business name and leave the Federal Tax ID blank.

We first applied for (and received) the Amex Business Gold Rewards Card. While this card has a $125 annual fee after the first year, it also came with $150 in signup bonuses. Thus, we’re not likely to keep this card beyond the first year.

Our choice for the longer term is the CitiBusiness Card with ThankYou Network which not only offers rewards, but also has no annual fee.

There are, of course, other options out there. For example, the Amex Starwood Preferred Guest Business Card, which offer $100 in signup bonuses, but has a $30 annual fee after the first year. Thus, you can make a good bit of jingle by applying for these cards, but you probably won’t want to keep them beyond a year.

Truth be told, we don’t really need a business credit card, but having one will make the bookkeeping a bit easier (anything charged to that card will be a business expense, so we won’t have to sort through expenditures at tax time). It also helps with the substantiating the independence of our business endeavors, which is important when it comes to maintaining the liability protection offered by an LLC.

Follow me on Twitter!

---
Related Articles at fivecentnickel.com:

» Establishing Credit With a New Taxpayer Identification Number
» The Convenience of Using a Debit Card
» AmEx Credit Card Signup Bonus Disappearing Soon
» Carnivals – Week of 02/26/07
» Signup Bonuses for Business Credit Cards (Anyone can Apply)
» How is Your FICO Credit Score Determined?
» Amex $150 Signup Bonus Still Alive?
» Credit Unions Can Seize Funds to Cover Credit Card Defaults

Whether you’re dabbling in self-employment, or you run your own full-blown business, here’s a good example of why you might want to dissociate your business address from your home address… A process server showed up on our doorstep on a Sunday morning awhile back. What a nice Sunday surprise! No, they didn’t show up looking to serve papers on my wife or me. Rather, they were looking for the guy that used to own our house. As it turns out, he’s a home builder, and someone is suing him. While his business partner was listed as the registered agent, they ended up using his (our!) address as the physical address of their business. While we got a good laugh out of this, it certainly reinforced the idea of using a P.O. Box for business-related mail, and also using something besides your house as the physical address of your business whenever possible.

Follow me on Twitter!

---
Related Articles at fivecentnickel.com:

» Carnivals – Week of 02/05/07
» From the Archives (January 27th – February 9th)
» More on the Home Office Tax Deduction
» The Best of January 2007
» Establishing Credit With a New Taxpayer Identification Number
» Renting a Post Office Box
» Joint or Separate Finances?
» Registering an LLC

If you’re starting your own business, you might want to apply for an employer identification number (EIN). A few weeks ago, I did just that, and I thought I’d run through the process here for all to see.

In many cases (such as most sole proprietorships) you don’t need one. That being said, you still might want one — e.g., for privacy reasons, you might not want to disclose your social security number (SSN) when you can otherwise use an EIN.

As it turns out, you only have to apply if you answer yes to any of the following questions:

(1) Do you have any employees?
(2) Do you operate your business as a corporation or a partnership?
(3) Do you file any of these tax returns: Employment, Excise, or Alcohol, Tobacco and Firearms?
(4) Do you withhold taxes on income, other than wages, paid to a non-resident alien?
(5) Do you have a Keogh plan?
(6) Are you involved with any of the following types of organizations?
- Trusts, except certain grantor-owned revocable trusts, IRAs, Exempt Organization Business Income Tax Returns
- Estates
- Real estate mortgage investment conduits
- Non-profit organizations
- Farmers’ cooperatives
- Plan administrators

If you end up deciding that you want (or need) to apply for an EIN, you have a variety of options… You can apply via phone, fax, mail, or online. In my case, I decided to handle it over the phone. In short, this involves calling the IRS at 800-829-4933 and working through Form SS-4 with a phone rep.

If you choose to do it this way, I highly recommend having the form in front of you, as this will save the rep from having to read everything to you over the phone. Once your application is complete, they’ll give you your EIN over the phone. The official paperwork will then follow within a couple of weeks. Easy peesy.

Follow me on Twitter!

---
Related Articles at fivecentnickel.com:

» From the Archives (January 20th – January 26th)
» Carnivals – Week of 01/29/07
» Establishing Credit With a New Taxpayer Identification Number
» From the Archives (November 25th – December 1st)
» The Best of January 2007
» Self-Employment, Taxes and SEP-IRAs
» What are the FICA-HI and FICA-OASDI Taxes?
» Help a Reader: Flexible Spending Account (FSA) Overspending

Given that we’ve been going to the trouble of formalizing our online ventures as an actual business, I thought that I’d go the extra mile and document the various steps here. Since our goal is to separate our business and personal lives, it only makes sense to rent a Post Office box such that the business side of things can’t be easily tied back to our home address.

To this end, I dropped by the Post Office to check out what they had available. As it turns out, P.O. Boxes are way cheaper than I had expected. The least expensive option, with a 3″ x 5.5″ opening, was just $26/year. We opted for the second step up (5″ x 5.5″) at $38/year. While the sizes are standard across locations, prices vary depending on where you’re located. This table gives you and idea of the range (prices reflect six month rates) but you have to know which “Fee Group” you’re a part of before you can figure out your exact cost. It’s probably easiest to just call your local Post Office for pricing.

More info on P.O. Boxes is available from the U.S. Postal Service.

Follow me on Twitter!

---
Related Articles at fivecentnickel.com:

» Carnivals – Week of 01/29/07
» Keeping Your Business and Home Life Separate
» More on the Home Office Tax Deduction
» The Home Office Tax Deduction
» Rent vs. Own Poll Results
» The Cost of Not Answering the Phone
» Applying for a Passport
» Dealing With Found Money, Followup

As I’ve mentioned in the past, my wife and I are in the process of separating our business and personal finances. When I talk about “business,” I am (of course) talking about income from online publishing (including this site). Well, last week we took what is perhaps the biggest step toward creating a separate business identity — we registered a Limited Liability Company.

Although the process varies from state to state, forming an LLC is typically pretty easy. In our case, we were able to register online through our state’s website for just $100, and we had an official (albeit electronic) copy of our Articles of Organization in our hot little hands just a day later.

In most cases, there’s no real reason to use one of the many online business registration services. In fact, if you’re worried about making sure that everything is in order, I’d suggest that you spend a few bucks on a consultation with a local attorney that specializes in business law rather than settling for a cookie-cutter solution.

So why did we decide to form an LLC when we could’ve simply continued handled things as a sole proprietorship? The main reason is that we want to draw a clear line between our business and personal lives. In the event that we ever run into any legal issues, we’d like to insulate our personal assets from our professional liabilities. Given the relative ease with which you can establish an official business presence, it’s a no-brainer.

Follow me on Twitter!

---
Related Articles at fivecentnickel.com:

» NCRC Sure Looks Like a Scam to Me
» From the Archives (December 23rd – December 30th)
» The Economics of Super Bowl Ads
» Voter Freebies
» Renting a Post Office Box
» Upromise $10 Signup Bonus