An Introduction To Your Business Finances

Without a budget serving as a map, your business and retirement hopes will be destroyed.

One question that arises for many beginning farrier businesses is whether your practice needs to “go legit” if you’re just starting out and there are few sales. The simple answer is do it right to begin with and avoid any future complications. 

If the government finds out you’re not running a legit business, you could become subject to fines and penalties as well as your business being shut down. If you don’t pay taxes on your earnings, the Internal Revenue Service can track you down and impose criminal charges and even jail time. Never think that you won’t be caught 

This is especially so if you accept credit cards, as your business is easily exposed. It can be quite intimidating to officially register your business, but it isn’t that complicated to fill out the forms. 

Where To Begin

 First, obtain a Federal Employer Identification Number or FEIN. Technically, as a sole proprietorship, you don’t need to obtain a FEIN, however, it will allow you to fully separate your business from your personal affairs. It is easy to obtain from the IRS website. At a later date you may take on a customer or barn that will provide you with a 1099-MISC for what they paid you for your farrier service. You will find it safer to give out your FEIN than your Social Security Number. In general, any service provider (such as a farrier operating as a sole proprietor, partnership or LLC) that has been paid $600 or more can…

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Esco Buff

Esco Buff, CF, APF, of Webster, N.Y., holds a PhD in business administration and is a member of the International Horseshoeing Hall Of Fame.

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