# Questions regarding opening a woodworking shop.



## SugarbeatCo (Mar 10, 2012)

Let me start this post by thanking you in advance, as this is sure to be long and confusing. My name is Courtney, and I am trying to start my own woodworking business. I've just returned home from a runaround adventure of trying to procure a business license in this red tape state of California. I'm working out of my dads rented garage which may or may not be a permitted building, with wiring, which I'm sure, isn't up to code. The first question they ask is where you will be running the business. They informed me that I would need to talk with the planning department and they would need to send out an assessor, the EPA, and we would have to have a signed written letter from the landlord, and a scaled blueprint with all building locations, parking and setbacks, sewage disposal systems, wells, the road providing access to the business, and the parking area for the residence and business. 
All I am trying to be able to do is legally sell my housewares and crafts, both at local markets and craft fairs, online and possibly a few local stores. With this being said. I only plan to be in California for the next year or so, and I am having a hard time justifying spending 400 just to have the assessor's and EPA out. I guess my question is: Has anyone dealt with similar circumstances, is there anyway we can get around this without creating problems for my dads landlord? I started this thing with a carving knife, and have been pedaling my wears on etsy, now I have just about every tool a woodworker could want and am trying to take it to the next level, but its feeling so impossible. I certainly wouldn't expect my dads landlord to sign a written letter allowing the county assessor to come and mark up all of his un-permitted buildings and the shady electrical system. What can I do? I'm eating rice for weeks on end trying to get this thing off the ground. I've just graduated high-school, trying to get myself in college, I've got health issues that prevent me from getting a 9-5, (IE Chemo every 4 weeks), and it seems to me that it is actually easier to just give up, sign up for state funding and live off this system to get myself through college. WTF is wrong with this state? 
Any advice is appreciated, just feeling really discouraged and like the damn system just does not want me to succeed. Thank you again for your time and any advice, and sorry if my post seems more a rant than anything else. I don't have any mentor or anyone to ask otherwise.
Courtney


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## cabmaker (Sep 16, 2010)

Sorry to hear about this problem. Only sound advise I can give you is move away from california, the gold rush is over now anyhow. But I gotta ask, If you have already had sales, whats the reasoning for stepping it up a notch now by invlolving the local gov.? Are you just expanding your sales, or are you just wanting to do your civic duty? Will you be able to keep it up once you start collage ? I wouldnt encourage you to live off the system as you suggestted. There are other ways but without knowing more about the situation, well its just talk.


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## SugarbeatCo (Mar 10, 2012)

Yes, as mentioned I am wanting to be able to have a booth in local trade and craft fairs and sell my things legally at as many venues as possible. I would also like to separate my income with my business's income and expenses. And please dont mistake my saying that I want to live off the system, I certainly do not. I was mentioning that is actually easier to do. I'll be moving to South Dakota soon, but would like to procure as many sales avenues here in california as possible before leaving, so I may export from SD for supplemental income. If there is any information I have left out, Im sorry, and would be happy to answer any questions. I live in Nevada County, with my shop located outside Grass Valley city limits, but wish to sell everywhere.


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## canadianchips (Mar 12, 2010)

Different states have different laws. *I am NOT familiar with California laws *, with that said, there might be exemptions that allow for small business to start up without breaking the bank. 
Having a business licence might have benefits though. "Insurance being one of them" 
Keeping your company seperate from personal might be a good thing as well. 
Talk to other people at craft shows, see what they are doing . 
I am only offing some hints to what may work.
I have looked at the work you do. It is very GOOD ! Please don't get discouraged easily. 
*Hope This works out for you !*


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## crank49 (Apr 7, 2010)

As said above, some of us, me included, are not familiar with California law, but I think the problem of becoming a real business entity is similar all over, just not so stuck up the EPAs poop chute as The People's Republic of California.

Twelve years ago I started a business in Tennessee and you have to decide whether to incorporate or not, then get state resale tax number, city business liscense, get an appraisal for personal property used in business to pay property tax on that, and on and on. Most of it is just a bunch of crap some "government leaders" came up with to make money to provide services and to buy votes with.

Be aware that when you make the jump, your insurance will likely be canceled. You will have to buy business insurance which is way more expensive. But, if there was a claim filed right now and the insurance company could prove you had made stuff for sale they likely would not pay it anyway.

Welcome to the world of small business. I often wonder why I fight this battle, but maybe I just love the challenge.


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## a1Jim (Aug 9, 2008)

I'm not a lawyer so don't consider what I have to say as legally correct only a licensed attorney can give legal advise.
If I were in the same situation I would make the things I want to make and not call myself a business as far as the local authorities are concerned, As far as anyone knows this is your hobby,That's what I would do if any officials came knocking on my door ,If they refer to your investigation on becoming licensed tell them the truth that after checking it out you gave up the idea of going in business. IRS is a different animal if you make money then pay your fare share and call yourself a business. This approach is done every day because of unfair zoning laws and bureaucratic rules.
My father-in-law made doors and windows for 60 years in California every couple years someone from the state would come by and tell him he needed a contractors Licence every time the did my father-in-law would say no I don't I'm a manufacturer not a contractor. If for some reason the county/city says your in business and take some action chances are it would take them much longer to shut you down than your going to be there. If I was thinking of having employees that would be a whole different thing, where big fines could be imposed not having insurance and proper safety equipment. Once you move you might have a better idea about what your going to make is profitable or not and you can get set up according to local South Dakota rules. There are thousands of people through out the US that work out of there garage who don't have proper zoning,permits or approval for what they make, an chances are the majority never will have a problem with cities or counties because it's not that big of a deal. Unfortunately the people who want to play by the rules and inquire about the right way to do things are the ones who get hammered. Just for the record I'm properly licensed and zoned in my two business in Oregon.


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## Howie (May 25, 2010)

The sad part of this is, that the people that are trying to be honest and play by the rules are the ones that end up with the shaft.
Our "politicians" get on TV and encourage people to be enterpreneurs(sic) but they make it such a problem you wonder if it's worth it.
Good luck to you, maybe the Dakotas are a little more linient.


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## donwilwol (May 16, 2011)

I agree with canadianchips. Find out what others that do the same thing are doing. I'm a long ways from California, but have seen very similar issues. Seek advice from the local. The theory of "for the people, by the people" went out some time ago.


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## Loren (May 30, 2008)

Buy and read "Small Time Operator". You've already got yourself
into a situation. Read "Working at Woodworking" as well.

Some entities will want to know where your "place" of business
is. Well, if you tell them it's where you sell your work… e.g.
craft shows in a broad region some of your headaches with
local regulation may disappear.


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## Grandpa (Jan 28, 2011)

I can sympathize with you. I was born in California and I never had a state issued birth certificate until 2005. I had a hospital certificate and until recently that worked. I was 2 years getting a certificate from the state only to find that my last name was not spelled correctly. My dad's name was correct but some well meaning soul used a fountain pen to make a mark to the margin and add an extra letter to his name to make it like mine! Long story but it took me 5 years and an congressman to get the certificate with a correction. Then I had to decide if I really wanted to send it off and get a passport. 
I would make the products you want and go on. I tried to get city permits from a town in Illinois so I could finish a basement room for my daughter. They drug their feet for months. She finally picked up the paperwork she had submitted and we moved forward. I really think they wanted me to go home and have one of their local contractors do the work but it didn't happen that way. Sometime you have to do what you have to do. Personally I would try to move before the year is over. Good Luck!


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## JAAune (Jan 22, 2012)

I think A1Jim has a good idea. Instead of trying to run an actual business take the time to create the infrastructure and refine the design and production methods of your intended product lines. Sell your things online and at shows to start with. Starting a relationship with local stores would be a good thing but it'll take some time and you'll probably be about ready to move out by then anyhow. If you intend to spray finishes, stick with water-based products to avoid violating EPA regulations.

I'm currently organizing a business of my own at the moment and I expect the startup process to take around 3 months. Illinois isn't too bad when it comes to regulations for a small woodshop with no employees and I expect South Dakota is even better (Chicago has a negative impact on the entire state over here). It would take me longer than 3 months if I didn't already have most of the needed skills and equipment.

I recommend taking the time to create a business plan and a marketing plan. The process of doing so will help you determine exactly what it is you want to do and give you a rough path to follow. If you want more information let me know and I'll post links to the various sites I've been mining information from.

Also, I highly recommend learning how to setup and run a website. It's not nearly as difficult as it used to be and most young people are familiar enough with computers to pick up the needed skills quickly. Even though you intend to sell mostly through retail outlets, Etsy and shows, a good website is critical to have these days. You'll want to attract potential customers to your website then link them to the stores and Etsy pages that sell your products. I can give you some direction on this as well if you need it.

Get a decent camera and learn to take really good pictures. A mistake I made in the past was to neglect taking photographs of my work in progress. The finished products often didn't get shot either and if they were, the photos looked amateur. Since you're going to do small projects, there's no excuse not to get good pictures in this day of digital photography.


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## HalDougherty (Jul 15, 2009)

You have my sympathy for the trouble you are having trying to get legal. Here's a couple of reasons why I enjoy a very small woodworking operation. Some areas of the country make it much easier to start and run businesses. South Dakota is especially nice to new businesses. I harvest timber from my own woods and saw them into the lumber I use to make products for sale. I can qualify for a farm license but all it would be used for is to buy equipment used in the farming operation without paying sales tax. I'd rather pay the sales tax than deal with the record keeping. I can build a building on my property to sell my crafts and farm produce and I don't have to collect sales tax. That sure makes it easy to do business in Tennessee.

I looked at your Etsy site and your products should sell very well at craft fairs and on the Internet. Keep us updated and let us know how your regulatory issues are resolved.

The bottom two paragraphs are just part of a larger document from a Tennessee Govt. website. I pay sales tax on everything I buy and only sell products from my farming operation. It's been a family business since the 1800s when it was a working farm. We stopped raising cattle and cash crops, but we've never stopped selling our hay, so now I'm harvesting grass and trees and selling the processed products of my farm.

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49. Are farmers and nursery operators who buy and sell agricultural products, including livestock, required
to present the certificate of exemption to buy agricultural products, including livestock, tax exempt or obtain
copies of purchasers' exemption certificates to sell agricultural products tax exempt?

No. Agricultural products grown and produced by a farmer and purchased directly from the farmer that grew or produced the agricultural products are not subject to sales or use tax. The farmer is not required to obtain the Agricultural Sales and Use Tax Certificate of Exemption to make tax-exempt sales of agricultural products that the farmer grew or produced. The Agricultural Sales and Use Tax Certificate of Exemption is required to make taxexempt purchases of machinery, repairs, and certain supplies for use by a qualified farmer, timber harvester, or nursery operator.
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55. I cut the trees from my own farm, have the lumber sawed, and my family makes birdhouses, baskets, and
similar crafts. Should I charge the tax on these items?

No; as long as these are created from wood from your farm, they are not taxable. However, if you buy the lumber and other components from a supplier, the sale of the home-made craft is taxable.


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## Sawkerf (Dec 31, 2009)

Courtney -
Was it the state telling you those requirements or was it the city/county? AFIK the state only cares about collecting their sales taxes (Franchise Tax Board), and that you have any reqired professional licensing (Department of Consumer Affairs). Business "licenses" are usually issued by the city, and are essentially receipts for an annual tax.

Assuming it was the city or county, were they clear that you wouldn't be selling out of your shop? When I started up, the city inspector came by and signed me off when I told him that all of my work was custom for specific customers. I had no sales space or inventory.


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## Puzzleman (May 4, 2010)

Courtny, I agree with a1Jim. Since you have medical issues preventing this from being a full time job, I would call it a hobby. A hobby that takes alot of your time, but nobody can tell you how much time to put into your hobby.

Like a1Jim said, the problem comes when you declare income and make a profit. You can have a hobby and make a profit and the IRS wants their share. give it to them. And do not tell anyone that you are in business. You have a very engrossing hobby.

No regulations or licenses for a hobby. Remember, it is a very engrossing hobby!!


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## NBeener (Sep 16, 2009)

Along with the rest of this, I simply wish you the best of luck with your health. Sounds like you're dealing with cancer. Shocking, and tragic … particularly at your age.

All the best….


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## BillWhite (Jul 23, 2007)

Go ahead and move NOW! You're gonna have to deal with all the crap forever in CA. What a shame, but that's the way it is unless ya have a zillion bucks or just don't care. Next you'll need a health dept. permit because of your illness (which I hope you beat).
Bill


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## Bertha (Jan 10, 2011)

Wow, lot going on. Sorry for the governmental speed bumps. Be well.


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## Richforever (Mar 19, 2008)

Courtney,
Lots of good advice. My suggestion is focus on the hobby aspects. Start the business aspects when you need to hire someone or ramp up production. On a more abstract level - each person creates his or her reality. If you focus your attention on what you don't want, then you will attract it like a magnet. By focusing on what you do want, you feed your energy into it, and the other stuff will not harm you. This is true regarding health issues as well as woodworking. I've seen this with my Dad, who overcame cancer without the chemo and drugs and stuff. I've seen it in other aspects of life. Maintain harmony in your feelings; focus on your mental image of what you want. Feed your energy into it. The future is your "lump of clay" ready for molding. God bless.


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## SugarbeatCo (Mar 10, 2012)

Thank you all so much for the info, recommendations and well wishes. I hate that my first post on this site is just whining, Im not "that person" at all. I will overcome this, just so discouraging to have made it this far and to be shot down so hard. I do what I can in life to remain positive. There is a way around this, I will find it, and to hell with a gov't that makes it easier to get welfare than to start your own business. What have we become? 
The County planner requires me to pay $483 dollars to come to my dads rented house and make sure we are even allowed to do business from there. So that's $483 to find out if I'm getting my dads landlord in trouble or not. I know for a fact I want absolutely nothing to do with the EPA, but that's part of that $483, to have them survey all drains, runoffs and finishing practices. They need 2 copies of a engineered plan with north pointer, all drains and sewers/septic tanks and leach field, all property setbacks and the road to my shop plus all buildings. I highly doubt any of the sheds and outbuildings are permitted. Ugh…
I feel I was very clear when stating that I did not want customers at my shop, wouldn't be planning for it, or any of that. Although the woman I spoke with said "well its ok if you do, we just need to make sure you have handicap parking and a restroom available". So I don't think I was unclear about that. Maybe I just need to be asking different questions. I will contact a guy who runs a cabinet shop just outside of town, see if he has any insight for me.
The real problem with the hobby aspect of it is that I am growing, I do need to ramp up production, I have done what I need to do to ramp up production. I have a business plan, I have received investments. I have my items in stores locally, online in many places, and its starting to become obvious that I've outgrown my "Hobby" status. Maybe it would be less obvious if I didn't have the same name on all of it. I got a loan for 20 large to upgrade my equipment, the investor would like to write off that investment, I would like to not claim that as income. I'm never going to give up with this venture. This is what I do, I love it, I will fail 100 times if that's what it takes to find my "niche". South Dakota is poor, and I need to maintain relationships with the few business's that I deal with here and I'm not sure what all that will entail either, but that's neither here nor there. I guess the short of it is, that I need to learn some more, and I will share my findings in this thread asap. Maybe it will save someone the stress of having to deal with CA BS. Thanks again to everyone for the advice and please know it doesn't fall upon deaf ears, I am learning, I will overcome.


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## SugarbeatCo (Mar 10, 2012)

P.S. for those who were wondering, I have one treatment left, things are looking great, I should be done with this soon (I pray).


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## a1Jim (Aug 9, 2008)

I hope all goes well with your final treatment and whatever path you take with your business.


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## SugarbeatCo (Mar 10, 2012)

Thank you!


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## wormil (Nov 19, 2011)

The sad part of this is, that the people that are trying to be honest and play by the rules

No, the sad part is that there are literally thousands of businesses that won't play by the rules unless someone forces them. They will gladly dump their toxic chemicals down the drain, annoy their neighbors with excessive noise or traffic, cause fires with substandard electrical, or generally put others at a disadvantage or in danger. The sad part is these rules are necessary because there are too many bad apples. True, it means that honest people have to jump through a few hoops but lets put the blame where it belongs. Rather than be angry because of the rules let's be glad it means your neighbor can't poison your water or drive you nuts.


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## Tennessee (Jul 8, 2011)

Wormil has a point, but where I live when I set up, it is obvious that at least some of the things I wrote checks for were nothing more than revenue streams for city, county and state government. Absolutely no value at all to me or my customers, no visits by anyone, on and on. I put it all in the hands of my lawyer and my business insurance agent and it's working out fine. But then, I live in a right-to-work state, don't have the toughest laws on pollution in the country, and my state is not bankrupt. $483 just to find out if you even qualify to buy more licenses? Sounds like government employees thinking up ways to support more government employees to me.
Agree with a1Jim, find out what others are doing. Then, establish an internet presence, like a website and Facebook page, and move from California ASAP… And as far as South Dakota being poor? You will be living next door to one of the new richest states in this country, North Dakota. Maybe move up one state??


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## Sawkerf (Dec 31, 2009)

After reading #18, it's pretty obvious that you're definitely moving beyond the "hobbyist" level and going into much more serious production. With that said, I don't get why you're complaining about the rules we need to follow to be a legitimate business.

As Wormil says, the state is full of people who short cut the system - I compete with them almost every day. Many of them get away with it, but many of us have followed the program, and are doing fine. If you're really *trying to be honest and play by the rules*, suck it up and do so. If you just can't, you have three choices.

1. Do it on the sly. You'll probably get away with it, but if you get caught, take your medicine like an adult.
2. Do it by the book. Yeah, it's more difficult, but it can work. (It does for many of us.)
3. Take your business somewhere with rules more to your liking.


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## Richforever (Mar 19, 2008)

Courtney,
The Small Business Administration offices have free business counseling by retired business people, plus workshops on doing business plans, etc.. Some are lawyers, accountants, former business owners. These counselors can mentor you regarding business building.


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## SugarbeatCo (Mar 10, 2012)

Im "complaining" because one of the brokest states in the usa makes it easier to recieve tax dollars than it does to pay them.. It doesnt take a rocket scientist to see the problem with that.


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## SugarbeatCo (Mar 10, 2012)

Thank you rich, i appreciate the info and will be looking into that for sure


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## Dchip (Jun 30, 2009)

I strongly second Rich's recommendation. I explored the SBA resources mostly out of curiosity and was easily connected to three retired businessmen and women who were very willing to help in whatever capacity they could. I was actually amazed at the speed and detail they provided with their assistance. I believe the SBA directed me to this service: http://www.score.org/


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## Sawkerf (Dec 31, 2009)

Sugarbeat -
Ok, the rules don't seem to make sense. I agree with that in many cases. However, until they're changed, they're the playbook we have to follow to be legitimate. A majority of the businesses in CA have managed to survive - and even thrive - while following those rules.

Put your energy into figuring out how to make it work instead of whining. You can do it.


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## kendi (Apr 17, 2012)

Hi Courtney,

First off, I wish you all the best with your treatments and health!

I'm really curious to hear what you find out as you work through your problem with CA. I'm sorry to hear that this state is making it so difficult for you! Like you, I'm also a young female that is very much interested in starting up my own woodworking business in CA. I'm COMPLETELY starting out though, so I'm nowhere near actually going to get a business license yet. However, I am taking a "small business" class in which we are writing our business plans, and I have elected to draw up a plan for my future furniture business, so I've been looking into all the details. (That is how I came upon your post, actually!). I figured I would keep it simple and run my shop out of my garage, without any clients coming by the house - but from your post it sounds like maybe it won't be that simple afterall!  Please, as you find out more information, I would much appreciate your updates! 

Do you have any other advice that you've found out that is specific to CA? I keep doing Google searches for info but it is hard to find. I'm not sure if you need a license/bond and all of that to build and sell furniture - I know cabinet makers and contractors need it, but it's unclear to me beyond that. Anyway, my venture is for sure at least a few years away, but I would appreciate any of your insight! For my class, I'm required to do a couple of interviews of business owners, so if I find out anything useful, I'll make sure to post. My neighbor also makes stone tables out of his garage and sells them, so maybe I can wander over and introduce myself and ask him how he does it…

Good luck!!!!!


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## mojapitt (Dec 31, 2011)

First of all, I wish you the best with your health. I work in a hospital and see that situation far too often.

If you are only planning on being there a year or so I would stick with the craft shows and internet sales. Where are you going to College? Maybe start planning now on a shop where you are going and getting it figured out there. By the time you get through the red tape it will hardly make it worth it.

For those who insist that you go through the red tape, I agree that the rules should be followed for the most part and that everybody should be conscience of the enviroment. However the dishonest ones will continue to try to be dishonest in more devious fashions. I guess my thought is make sure we punish the dishonest ones, not the honest ones.

Welcome to LJ's


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## tncraftsman (Oct 21, 2009)

Contact your SBA. They have free (tax payer paid) advisers to help navigate the red tape. SBA has a couple of different counseling service, Small Business Development Centers (SBDC) and SCORE.

There will be red tape in any state you do business with. Some are better than others.


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