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Wednesday, September 06, 2006 |
NY State to Small Businesses, Drop Dead

I've been wanting to start a little photo magazine, thanks to the low low prices of print-on-demand via, for some time now. Not all the pieces are in place yet, but they are coming together, and I was feeling pretty optimistic about the whole project. I crunched the numbers and figured that I could provide a photo book with nearly 30% more picture goodness then the leading low-budget photo mags (jpg magazine and U&I magazine) for nearly the same cost. The profit margin would be razor thin, and I'd have to sell nearly 1,000% more magazines then my first try (the flickrati NYC one shot book) just to break even. But for a small money losing operation, it might be a fun project for the next two years, and would give me some small business experience and credibility. I even budgeted a small fortune (nearly $500) for initial startup costs and such. My biggest worry, however, is legal, as I don't want to be completely liable for everything the small company does.

As it turns out there is a solution to that, forming an LLC. An LLC provides limited liability, and yet is taxed in a very simple fashion (it acts as a simple pass through). Filing costs are a little high ($200 for filing, plus $50 in assorted other fees), which caused a bit of hesitation. But there are legal protections that don't exist for sole-proprietorships, specifically protection from creditors. I don't have much money, and I'd like to keep what little I have somewhat secure from lawsuits and the such. It's simpler then a full bown corporation, and yet has many of the same protections. In short, it's nearly perfect for a small time guy like me.

Which is why, of course, NY state just ruined it all with the publication requirement. The publication requirement is that you have to publish in 2 officially designated newspapers an announcment of the LLC's formation, for 6 weeks. In NYC, the rates are sky high, and early estimates are in the hundreds. My budget is being blown out of the water before I even get a chance to file the papers. Needless to say, my small business dreams are now dying a slow death, thanks to the good folks in Albany. Because, apparently, the last thing we need in New York are more businesses.

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