Attorney Thomas B. Burton answers the following question: What Do I Need for Starting a Business in Wisconsin?
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Welcome back, I'm Attorney Thomas Burton. I'm an estate planning, asset protection and business law attorney here in Wisconsin and today's question has to do with business which I always enjoy and here it is - "What do I need for starting a business in Wisconsin? I currently have Bills Piano Service which is not licensed yet and would like to get a license for that. I also would like to get a license for automotive consulting and general housing repair. I don't know what it would cost to do all separately or could I rename to consolidate all three into one name?"
So excellent question and it sounds like you've got a variety of entrepreneurial activities going which is great. If you're currently operating all three businesses, my guess is you're operating them as what we call a sole proprietorship in Wisconsin and basically, in Wisconsin, a sole proprietorship requires no separate paperwork. All you need to do to start your own business is just really start providing services under your own name which it sounds like, to me, you may be doing as Bill's Piano Service and with the sole proprietorship, the income from the business gets filed on Schedule C during individual tax return and you can file that using your social security number, you do not even have to get a separate Tax ID.
Now, your question about licenses is a good one and I would check with the Department of Agriculture, Trade and Consumer Protection and the Department of Safety and Professional Services. They have a list of regulated professions that you need licenses and DSPS, you can search the list and you can also search with the Department of Agriculture, Trade and Consumer Protection. On initial review, your piano service, automotive consulting that I'm not sure you need a license for that, not every profession needs a license but in Wisconsin, there are certain ones that do like I know hairdressers and funeral directors and different things and there's sometimes debate over how many people should have, be required to have a license but you can think of things like electricians, plumbers licensed professions, attorneys, doctors for sure but your three didn't initially ring a bell with me that it would require license. So if you don't need a state license, then you just need to check wherever you live. If your city required some sort of license to operate it out of your home? I don't know if you are operating it out of your home but if you are, then you might need to get that. Other than that, you can operate a sole proprietorship under your own name as you're doing. Now in general, I would suggest you open a business bank account, so you can keep your funds separate and do the accounting and the books that way but your question about, "Can I combine all three businesses into one name", the answer would be Yes and if you did that, I would suggest you might want to look at forming a business entity and a really popular one for small businesses would be a Single Member LLC. So you could form a Limited Liability Company where you're the only member and the 100% owner of the percentage interest of that LLC and you could operate all three services under that business. It would be up to you, if it makes sense to operate them all marketing wise under one business or whether you would want the LLC to be the parent company and you still maintain those whatever trade names you're using Bills Piano Service, if you have a name for the automotive consulting, you could operate them under what we call a Trade Name in Wisconsin and you could register that with the state of Wisconsin and you could do that with a sole proprietorship as well but if you form the LLC, let's say you formed Bills, I don't know, Automotive, Housing and Piano Services LLC or whatever you want to name it Bills General Services LLC and then you had the different business lines under it, that would be one option. If you're real concerned about liability between one business and the other, like if one incurs more liability concerns, I don't know if the automotive or the housing would, you could do a totally separate LLC for that Bill's Housing Repair LLC, Bill's Auto Repair LLC and Bill's Piano Service LLC and that you could also do as the businesses grow, if you wanted to maintain separate liability and assets for each business, so that if, if someone sued you for your automotive work, they couldn't get at the assets of the piano business likewise if they sued you for the housing work, they couldn't get at the assets of the automotive business. So you have to evaluate how much business you're doing through each business and when and whether that would make sense but you could start with one entity from which you operate all three services, provided you're not in a licensed profession that requires a separate entity just for that service like a Law Firm for example requires its own entity for the legal services but yours don't strike me as that off the bat, again, check with the department of safety and the department of agriculture about that but then in terms of let's say you did form one LLC, you could run all the services through there and you could file your taxes the same as a sole proprietorship, one Schedule C to your personal tax return, would report the income, the profit and losses from your new LLC and from the the various services you provide.
So there's a variety options there that you could move forward. I tried to lay down some stuff you can do yourself but I also recommend sitting down with a qualified attorney, who could help you map that out in more detail and set up the LLC for you, if that's what you decide to proceed with.
So great question it's always exciting to get questions from entrepreneurs and business owners. I hope this was helpful to you and we'll see you next time!
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