Tuesday, September 30, 2008

The Tax Man Cometh!


At the CBD we spend a great amount of time on business planning, market studies and helping you get your business started.

But it is very important not to forget the basic steps when starting a business – for example, registering with the Oklahoma Tax Commission.

The tax man always gets his money!

Some Oklahoma college students learned this lesson the hard way when they were confronted with a $320,000 tax bill from the Tax Commission. The students had a ‘party business’ that rented space in local restaurants and bars, hired DJ’s and then marketed the events. Of course, they did not collect any sales tax on those events and due to their web site, the state noticed them.

See article in Daily Oklahoman

The person interviewed said “they never really thought about Kegheadz as a business, so they never filed any paperwork with tax officials”.

Guess what? They were, and their error will cost them.

A smaller point easily missed is that one of the businessmen who rented space to the Kegheadz group is himself being included in the tax trouble. So if you are a business owner and contract with another organization – you’d better be careful to ask to see their tax registration form (non-profits have their own form that shows their status).

Good news is that the Oklahoma Tax Commission runs free classes regularly throughout the state – and really makes it easy for you to do the basic paperwork (of course LLC’s and corporations require a bit more work).

And we at the CBD are hosting a workshop by the Oklahoma Tax Commission on October 16th from 9-12 (registration required).

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