Entrepreneur wants to start a Doggie Day Care operation. Wants to know about business structure and payroll issues.

QUESTION.
I am in the planning stages of a Dog Day Care Center. I have not completed the marketing as yet but at this point I am estimating that the business will require myself plus four part time assistants each working 20 hours per week. The first help I need is on deciding if the business should be set up as a Sole Proprietorship, C Corporation, or a Limited Liability Corporation. The second help is regarding taxes, income and social security. The total gross per year is estimated at $100K to $150K. Thank you very much for your assistance.

ANSWER.
Sounds like your are in the process of putting together a business plan. That's the right thing to do. If you do it correctly, then you will have taken much, if not all, the guesswork out of your new venture. See Pick a Biz, Write a Plan for it, & Start the Biz
and How to Write a Business Plan.

The total gross income per year you quote sounds too low to me. After return on capital, return on your time, and return on ultimate goodwill, and taking out expenses and taxes there isn't going to be much left over for you. But you will figure out what works and worth the effort when you finish the business plan.

One of the elements of your business plan is making a choice of legal entity. If you are planning to created the business to be a job for yourself, and you don't expect to sell the business soon, then the only logical option for you is the LLC. See Choice of Legal Entity.

See also, Structuring Your Business by Michele Cagan. Make sure to read my book review for the book and consider getting a copy of the book.

You will have to pay salaries. And when you do you will have to do withholdings. I recommend you take a look at the various IRS publications that will interest you. See http://www.irs.gov/formspubs/index.html?portlet=3. At a minimum download Publication 505 and Publication 535.

I also recommend you contact your local SCORE chapter and schedule a face-to-face session with two volunteer counselors. The 1-hour session is free, and they will help you greatly polish your business plan.

I think I have answered your questions. I hope my comments are helpful. Good luck! Regards, -Jeff

Jeff Lippincott
SCORE.org Counselor
Princeton, NJ
scoreprinceton @ aol.com
www.scoreprinceton.org
http://www.jlippin.com/