It seems that everyone wants to tell you what to do when you set up your practice. But licenses and regulations set down by federal, state, and local entities must be adhered to, so let’s look at what you will need to do to comply. We’ll be looking at practices set up in the United States; most of these regulations apply to Canadian businesses too. (We will discuss taxes on employers in a separate article.)

U.S. REGULATIONS

• Taxes. You will need to pay federal income taxes for your practice, depending upon the type of legal structure you have selected.

• Sole proprietorship. Taxes paid on your 1040 (Schedule C filed showing business income).

• LLC. Single member LLC’s are taxed as sole proprietorships.

• LLC. Multi-member LLC’s are taxed as partnerships. A partnership tax return is filed, but partners pay taxes based on share of income.

• Corporation (Sub-S or C-Corp). Corporations pay taxes on corporate income on separate corporate tax forms.

Licenses. No federal licenses are required for your practice.

Other. You will need an Employer ID Number for your business. You can obtain this number by completing an SS-4 form (you can apply online from the IRS (www.irs.gov; look for the link to the online form on the IRS home page).

STATE REGULATIONS

Taxes. Most states require residents to pay state income taxes; you’ll pay based on the income from your practice, in the same manner and on the same forms as federal taxes. To find out what state taxes you will have to pay, check with the state department of revenue.

Licenses/Legal form. If you are forming an LLC, PLLC, PC, Sub-chapter S Corporation or other specific legal form, you will need to register your business with the state where you will be practicing. For more information on filing, go to the Web site of the Secretary of State, and look for “business services.”

If you are forming a sole proprietorship, you may still have to file an assumed business name (sometimes referred to as a “dba,” or, doing business as) form with the state. Some states also require a state business identification form.

Of course, you’ll need to acquire your state chiropractic license. For information on the licensing requirement in your state, go to the Web site of the Federation of Chiropractic Licensing Boards (www.fclb.org) and click on “chiropractic boards.”

LOCAL REGULATIONS

Some cities and counties require you to pay taxes. Check on the Web sites of the city and county where you’ll be practicing.

If you are a sole proprietorship, you will have to register your business name as a “dba” if the name is different from your name.

Don’t hesitate to get your CPA and attorney involved to help you file for the taxes and licenses you need. Although the federal requirements are standard, state and local laws vary greatly.

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