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Forum topic by Keithbrad80 posted 04-06-2021 04:39 PM 841 views 1 time favorited 27 replies Add to Favorites Watch
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Keithbrad80

27 posts in 30 days


04-06-2021 04:39 PM

Topic tags/keywords: question

Good morning,

I’m brand new to this forum looking for some advise. I’m in the process of starting my own turning shop, I’m currently waiting on my EIN. While I wait I’m trying to cover a few other things that need to be done and one thing I haven’t put enough thought into is what laws I should consider when selling my bowls. What laws, like attaching a prop 65 warning, should I consider when selling my products?

Ill give you some back ground info if it helps, I have a small 800 sf garage in California and do not plan to hire other employees. This also wont be my full time job, I’m a geologist full time so this will be a part time gig. I planned to include a small slip with each product on tips for taking care of the bowl and on the back a small prop 65 warning if I need to. I have read through the OSHA regulations for wood working and have tried to adjust my shop to accommodate their laws. I don’t use a guard on my lathe, thats probably the only one I haven’t followed yet. Also, being in California I’m sure there is something Im missing, are there extra regulations with regards to running a turning shop or selling wood objects? I think I have figured out most of the other aspects of running a business and would love some advise on the rules I should follow when I finally open the doors. Thanks!

Bradley


27 replies so far

View Madmark2's profile

Madmark2

2623 posts in 1664 days


#1 posted 04-06-2021 04:46 PM

Move out of CA as step #1.

-- The hump with the stump and the pump!

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Keithbrad80

27 posts in 30 days


#2 posted 04-06-2021 04:49 PM



Move out of CA as step #1.

- Madmark2

It’s funny you say that as it’s something my wife and I want to do in the near future. We are thinking next summer that it may be time to move. We lost our house a few years ago in a wild fire and the state hasn’t been the same since.

Bradley

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Madmark2

2623 posts in 1664 days


#3 posted 04-06-2021 04:59 PM

Ain’t joking. Use’ta live in LA back in the day. Glad I left. Moved to FL where you can keep what you earn (no state income tax) and buy a house outright for the down payment on a California slum. Laws are more rational here on a lot of fronts, environmental and otherwise.

-- The hump with the stump and the pump!

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Ruscal

91 posts in 254 days


#4 posted 04-06-2021 05:38 PM

For a part time side business open a LLC in your state to reduce personal liability. Make an asset list of tools you now own but are changing to business use. On tools you own, list a fair market value. Open a checking account for the business. Keep all your receipts. Get tax exempt set up everywhere you buy tools and materials. Charge and pay sales tax on sales, unless you are going to sell thru etsy, etc that collects and pays for you. If you have a home based shop you can write off some of the real estate, utility and repair costs vs. your profits. Check local laws, hire an accountant if you need help.

Prop 65 sounds like CA BS.

Good luck and if you’re not having fun stick with the day job.

-- Have a hobby? You should have a business.

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ddockstader

219 posts in 4337 days


#5 posted 04-06-2021 06:29 PM

Contact the local SBA office. They will give you ALL the California and local government requirements.

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Keithbrad80

27 posts in 30 days


#6 posted 04-06-2021 07:45 PM



For a part time side business open a LLC in your state to reduce personal liability. Make an asset list of tools you now own but are changing to business use. On tools you own, list a fair market value. Open a checking account for the business. Keep all your receipts. Get tax exempt set up everywhere you buy tools and materials. Charge and pay sales tax on sales, unless you are going to sell thru etsy, etc that collects and pays for you. If you have a home based shop you can write off some of the real estate, utility and repair costs vs. your profits. Check local laws, hire an accountant if you need help.

Prop 65 sounds like CA BS.

Good luck and if you re not having fun stick with the day job.

- Ruscal

Thanks, I appreciate the feed back. Most of those things are done, but thankfully you have reminded me to do other things! Prop 65 is in fact CA BS, it’s a warning stating that something has been used to create this that could give you cancer. It’s on everything in this state, unless it’s water it probably has to have this warning. Thanks again!

Bradley

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Roger10

6 posts in 1649 days


#7 posted 04-06-2021 10:32 PM

From Keithbrad80:

“Prop 65 is in fact CA BS, it’s a warning stating that something has been used to create this that could give you cancer.”

Actually, in this case, it’s a warning that sawdust accumulations in your nasal passages can cause cancer of the nasal passages. The warning is a somewhat extreme, but not “BS”.

So, mask up when making sawdust.

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WoodenDreams

1296 posts in 987 days


#8 posted 04-06-2021 10:56 PM

With tools, you are not exempt from sales tax on tool purchases, unless you plan on selling the tools. Tools are a deductible expense when filing your taxes. Check with a CPA to understand the tax benefit differences (equipment expense deductions) between a Business and a Hobby Business. A LLC is not worth the costs for a small woodworking business. With a LLC you have a higher cost in bookkeeping, and does not have a benefit for you in liability protection in this type of business. I somebody wants to sue you, They’ll sue the LLC and you. So no protection. Your better off starting as a Sole Proprietor or a Hobby business There may be a benefit to you with the carry over of equipment deductions, when starting as small Hobby Business. Either way you should have a EIN Number. And also apply for a sales tax exemption as a retailer. You may want to start out as a Hobby Business. I was a Sole Proprietor for twenty years before I retired. When I started a new woodworking business in 2017, My CPA advised me to have it as a Hobby Business. And gave me several reasons of the advantage.

Check with a local UPS Store. Find out the shipping and packaging costs. The UPS Store will guaranty damage free shipping if they do the packaging and shipping for you. This expense can be passed on to the buyer.

OHSA regulations will require you have a face shield for the lathe. As far as a tool guard, the only guard I can think of is a face shield and apron. You may be required a area that no one will be in front of or behind the lathe if a work piece flies off the lathe. . A fire extinguisher and Air Filtration Unit would be a good idea.

If you want to get out of the extra California regulations, Move to a different state. I do recommend having fun with your woodworking. Once it seems like a job, step back and take a rest. I got burned out, so I limit myself to 20 hours a week or less. Now it’s fun again.

View HowardAppel's profile

HowardAppel

71 posts in 4110 days


#9 posted 04-06-2021 11:18 PM

As a California lawyer, this is incorrect -”and does not have a benefit for you in liability protection in this type of business. I somebody wants to sue you, They’ll sue the LLC and you. So no protection.”

Yes, you can be sued as an individual even if you have an LLC (or corporation), but if you followed the very simple rules, e.g., maintain a separate business account, you will not have liability as an individual. Just as you likely would not accept advice about buying a lathe from someone who has never been a turner, don’t take legal advice from a non-lawyer.

NoLo Press used to publish very good books for laymen on issues such as operating your own business.

View Keithbrad80's profile

Keithbrad80

27 posts in 30 days


#10 posted 04-07-2021 12:05 AM

Thanks everyone for the responses, it’s very useful information! I follow the ATGATT philosophy, that is all the gear all the time. If my lathe is on I’m wearing my face shield, respirator, turning smock, apron and eye glasses at all time, no need for an unnecessary injury. I also have non slip papped floors in my garage and several fire extinguishers, I do all my pyro stuff outside any way next my hose. I have already started the process of forming an LLC so I’ll continue with that, I suppose it can’t hurt. I do have a separate business account already and am in the process of taking inventory of my garage. I also own the domain name for my business and hired my brother to build the website. I think checking with a CPA about deductions is probably a good idea, my wife also did book keeping for years so I’m sure she could teach me to take care of that my self if she doesn’t want to do it. I know I have strayed from the laws of owning my own shop but is there any thing else I’m missing that seems obvious? I’m a little nervous about that initial jump. I’ll also add that as a first timer this website is full of information, and helpful advise. Thanks again!

Bradley

View HowardAppel's profile

HowardAppel

71 posts in 4110 days


#11 posted 04-07-2021 01:09 AM

Liability insurance, especially workers’ comp (which is cheap for what you are contemplating), just in case you hire someone to help out one day in the shop or for a delivery and an accident happens.

View pottz's profile

pottz

16776 posts in 2060 days


#12 posted 04-07-2021 01:33 AM



As a California lawyer, this is incorrect -”and does not have a benefit for you in liability protection in this type of business. I somebody wants to sue you, They’ll sue the LLC and you. So no protection.”

Yes, you can be sued as an individual even if you have an LLC (or corporation), but if you followed the very simple rules, e.g., maintain a separate business account, you will not have liability as an individual. Just as you likely would not accept advice about buying a lathe from someone who has never been a turner, don t take legal advice from a non-lawyer.

NoLo Press used to publish very good books for laymen on issues such as operating your own business.

- HowardAppel


thank you howard we have way too many so called experts on this forum that have all the answers,mostly,wrong!

-- working with my hands is a joy,it gives me a sense of fulfillment,somthing so many seek and so few find.-SAM MALOOF.

View WoodenDreams's profile

WoodenDreams

1296 posts in 987 days


#13 posted 04-07-2021 05:30 AM

As Howard being a lawyer, I’m sure he could tell you of some of the whoppers in court settlements. I know of several that would shake your head. I know of LLC’s that had minimal liability insurance, The LLC was covered to a limit. But the individual who made the product was nailed because of claims of improperly trained and should have known better of releasing a defective and dangerous product and that had to pay above and beyond the liability coverage of the insured limits. Every state has different laws. Juries nowadays have put settlement rewards at mindboggling amounts. I do know every case is different. And some ambulance chasing lawyers are some of the blame for keeping a case lingering on. Be thankful you don’t have to follow MSHA regulations. OSHA regulations are much more lenient.

I’ve had one person on this site that called me a liar on this site when I said you can heat treat metals with water and quench with water. I replied to him that it would be nice to sit and talk about this over coffee. The fact is you can cool down heated metals faster in a tank of water than using oil to quench. Most forgers use oil nowadays. One of the old ways to quench metal was using a tank of water. Sorry about the rant.

View Wood_Scraps's profile

Wood_Scraps

125 posts in 95 days


#14 posted 04-07-2021 05:42 AM



Move out of CA as step #1.

- Madmark2

Best advice you’ll get all thread.

View DS's profile

DS

3742 posts in 3496 days


#15 posted 04-07-2021 07:14 AM

Wouldn’t it be ironic if they discovered that prop 65 warning labels cause cancer?!?

-- "Hard work is not defined by the difficulty of the task as much as a person's desire to perform it.", DS251

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