What is legally considered a business?

[ChristineM]

I'm sure this varies somewhat from state to state, but I'm wondering at what point one actually needs a business liscence, permits, insurance, etc. to sell photography. Is there a common dollar amount? It doesn't seem to me that if I were to sell a few prints at modest prices, or get a few images accepted at microstock sites, that it would be worth the time and expense of officially setting up a business. However, I don't want to just go ahead and start trying to sell my work without finding out. My insurance company already wanted to cancel my homeowner's policy because they thought I might be running a business out of my home due to the fact that I have a "professional" camera (I think they must have just noticed that I had a rider on my previous renter's insurance for my camera). I know nobody here can offer actual legal advice, but if you have any knowledge or experience in this area (especially specific to Oregon law), or can point me in the right direction, it would be much appreciated!

[Jim Poor]

Google is your friend: Oregon Small Business Guide | Business.gov

[ChristineM]

I have already looked at this site and tried google, but I haven't been able to find the info I'm looking for. Basically, I want to know whether I can make a slow start at submitting to microstock agencies and/or trying to sell prints via an online hosting site like zenfolio, redbubble, etc. or at a local coffeeshop or something, without risking losing my home insurance, accruing tax penalties, etc. At this point I am not looking for info on obtaining business liscences, etc. I know how to find that anyway. If anyone knows anything about this, please share! Thanks.

[bhursey]

If your going to be doing a service or selling goods you need to talk to a CPA "certified public accountant" for your state to find out what you need to do... I spent weeks researching online then found a 1st visit free cpa and got all my questions answered.

[dakwegmo]

In the U.S. you're required to report every penny of of income you make to the IRS, regardless of the source. Whether you have to pay taxes on it will depend on your particular situation, but you're required to report everything. If a company pays you more than $600 in a year, they're required to report how much they paid you to the IRS and give you a 1099. So, even if you're doing something as a hobby, and not really trying to run a business, if you're making money there could be a tax obligation.

As for the insurance issues, you'll need to check with your insurance company. Just because your state doesn't consider you to operating a business, doesn't mean your insurance company has to cover you as an individual. They may have guidelines about what constitutes a business than your government does, and they won't have any qualms about denying a claim if they determine you should have had a business policy.

[danbaileyphoto]

Your personal insurance policy will likely NOT cover you in the case of a business related accident, whether it happens to you or to someone else. However, depending on what kind of work you do, you may not need insurance. I would think that for what you are specifying, you probably don't need it. That said, check with your policy holder.

You will, however, like dakwegmo said, need to track all sales and expenses and report everything to the IRS if you make over $600 in a year. Just keep accurate records of everything you spend and take in. This is to your benefit too, because you can write off your expenses.