[lexnmike4enomore]

I am trying to start up a free lance graphic design business. Now i have been doing some jobs for about 2 months now. It seems like business is picking up. Now I'm not sure all the legalities that goes into this. I have been making invoices up but not charging them tax. I know that I'm cheating someone by doing this. I figure b/c its free lance and I kind of do this at home on my own time, that legalities wouldn't matter.
Do I have to notify someone of extra income?
Do i have to open a business account at my bank to deposit my income?
I don't even know where to begin. I know I'm going to be audited.
Any tip to get me off my feet?

[soccorsilly]

I am not an attorney and I do not play on e on TV.

But, in most states, services are not taxed. However, the income you receive from it is taxable and you should report it.

For freelancing here and there, I would not set up a corporation or anything like that. If there is some liability--ok you design someting and it sucks and ruins a companies reputation (I dont think so but) then you may want to consider a LLC whihc will limit your PERSONAL liability if you are sued.

If you grow to the point where you have employees, you should incorporate.

Sit down with a local business lawyer or accountant. And talk to them. It will prpbably be free because they are probably going to advise you to do something and they will in turn be hoping for your business in the future. It is a worthwhile investment for them--one hour for a potential ligfetime of work.

Just my two cents