Question I want to start a website to sell hand made hairbows and I am unsure about the legal issues. Do I need a business license, and since my website name will not be my actual name, do I have to register as an 'assumed name'? Also, if I use paypal as my payment method, and I will be using a secured server (hosted by someone other than myself) will I be held liable if customer information is stolen or will paypal and the host company be responsible? Please help! Do I need to contact an attorney just to run a simple website? Thanks!!
Answer You should always contact an attorney to make sure that you are as protected as you can be. Information from anyone other than an attorney is simply a personal opinion based on their own personal experiences and should not be construed as legal advice.
I am not an attorney or an accountant.
The government has managed to regulate every type of business that you can get involved in. Many people get away with operating their business outside of the law. They normally don't bother you unless you make money. They will then want what they consider to be theirs. If someone reports you for what they consider cheating them out of money, you will also be paid a visit. A dba license from city hall runs around $100 in most places and it makes your business legal but does not protect you personally from legal action. You will get a lot of information about the laws governing business when you apply.
If you end up making money, you will need a way to claim it on your tax return. If you are an affiliate, you will get a 1099 from the places you are representing and be able to claim your earnings as personal income. If you are inventorying product and shipping it, you will need a way to collect sales tax and send it in to the state. A dba license will give you a tax ID. Using drop shippers where you pay before the product is shipped and they invoice the customer in your name will require this also.
Being in business always carries a bit of danger with it. Normally PayPal or the host would be held responsible, but there is always the possibility that you could be named in a lawsuit along with them and whether or not you are held responsible will be determined by a court.
