The Legal Stuff

Discussion in 'Soap Making' started by jimandpj, Jun 25, 2008.

  1. jimandpj

    jimandpj New Member

    When making soap for just family and friends, I haven't worried too much about the legal stuff. But I guess I need to start dealing with it.

    So, how many of you do the business license? tax id? insurance? whatever else I don't know? stuff??

    What's essential and what is just a good idea if you get to the point where you're selling a bunch.

  2. MRFBarbara

    MRFBarbara Guest

    Legally you do not have to list ingrediants on soap if you do not want to.. I do, reason, some people are allergic to nut oils
    Customers want to know what is in the soap
    I have a DBA, Doing Business As number, filed with thecounty here in Michigan.. may be different in some states.. And I filed with my state and pay the state taxes on my income.. I am legal ( in my state)
    I do not have insurance, i guess I am walking the fine line if someone decides to say my soap hurt them and sue me, but it is so expensive
    Maybe some others will have some input on this..

  3. Narrow Chance

    Narrow Chance New Member

    I have a tax ID with the state.. I have to collect MS State tax.. pay it in every month.
    Was a bugger to get.. took forever.. but my bank would not open an account in a buisness name without a State Tax ID.. and I could not get a buisness ID without a buisness address.. so had to get the post office to come give me one on our barn.. because that is really the place of operation. Then send in the address to get the ID.. it was sooooo time comsuming.

    So.. I guess that makes me legal in our state.

    FYI... I don't collect tax .. but I do pay it in. I sort of figure that extra cost in on the end price of the soap.
    When my store actually gets open... and I have a store front.. I will have to actually add the tax to purchases.

    I list the ingredients on my soaps also.. and an 'approx. wt'.
  4. New Member

    Soap must have your contact info and the weight, but that is it, so selling naked bars is technically illegal.

    I also went the DBA route like Barb, although I have a Tax ID number also. I am a limited liability partnership with Lonesome Doe, purchasing my milk from...well me :) but run the goats and the soap made from the milk as farm income. It's technically a grey area counting my soap as milk income on my schedule F, but my CPA and the guy who does my taxes say it is no more or less like making cheese out of your milk or adding keifer to the milk and selling it. Course neither know that all of the milk part is completely illegal :) I also have an insurance policy for liablity on the farm since I have classes and do tours, the same company that has my goats insured. Vicki