Once you've decided to pursue online selling as a regular endeavor you'll need to decide how your business will be formally organized and how you'll meet your tax obligations. As your business grows you should periodically revisit the question of what is the best form of organization for your business.

Call your county government headquarters to ask what types of business permits and licenses are required in your jurisdiction. Some cities, counties and states require any business to get a business license. For example, if you are operating your book business in a residential area, your local government will likely require a "home occupation permit" or a zoning variance. With a zoning variance, you'll probably be required to promise that you won't have walk-in retail customers. Since your business is an online and mail-order business, this won't restrict your business.

If you are conducting your business under a trade name such as YourBookPeddler you should file a "fictitious name" certificate at your county or state government office. This is so people who deal with your business will know who the legal owner is. This is also known as a DBA name (Doing Business As) or an "assumed name."

Although it is often repeated that the Internet is a "tax-free zone," this does not apply to state sales taxes. You'll need to pay state sales taxes

on orders you ship to customers in your state. To pay the tax you'll need to open an account and obtain a "resale license" (in some cases they are known as resale numbers or sales tax certificates.)

You don't collect state sales tax on orders shipped outside your state. Internet sales (as well as fax, telephone, or mail-order) sales from another state aren't subject to sales tax, unless you have an office or warehouse in that other state. In some states, shipping and handling fees are not subject to tax.

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