Two questions...

[christwo]

First off, I just received all my tax information from the department of revenue. My question is this: It exclaims that I am required to file monthly. Can anybody elaborate on that for me? Is there more information I should be receiving from the DOR to further explain how to go about this? Does this apply regardless of wether or not I have had any business or revenue? What exactly is it that I am going to be required to claim, expenses as well? This is all new to me.

Second question: Does anybody know of or have any experience with any vendors in the Jackson/Nashville/Memphis area? Or any area of Tennessee for that matter? Any recommendations?

[MinUph]

Sounds like your talking about sales tax. Each state is a bit different but generally you would file weather you made money or not. If you fail to file they will fine you. Look at the website for the state your in there is probably more information there. Or call the department. Here in Fl. I can file on-line quarterly. In NY it was quarterly but on paper. That may have changed through the years in NY.

[Mike8560]

Ike
Paul
said state sales tax I have to report each month.
Income I file once a year  but pay quarterly

[christwo]

Yeah I came to find out that it is for sales tax only.

[byhammerandhand]

I'm  guessing sales tax is what you need to file monthly, too.   I agree this is very different state to state.   In my state, Ohio, I have to collect tax based on the locus of service (I work in about six different counties).  Each county may have a different tax rate.  Labor is taxable, usually, depending upon the service, and materials are taxable.   Certain services or customers are exempt.   In the state's  own words, "The tax code is complicated, if you have any questions, call us."   I also do a small amount of work in Kentucky and Indiana, where thankfully, there is no tax on labor.

We are required to file sales tax returns via their internet web site.  And yes, you have to file whether or not you have sales in a given period.    If you do not file, or make a mistake in filing, they will come after you and rack up lots of fees and interest.   It's best to stay on their good side.

They don't really care about your profit and loss (i.e., expenses).

But you can buy some materials tax exempt if you are going to resell them and collect tax.

The Federal IRS (in addition to state and city) also want quarterly estimates and payments for your income taxes.

You also need to decide business format -- sole proprietor, partnership, LLP, S-corp, etc.  And decide if you want to file a DBA (Doing Business As, required if you are a sole prop using anything but your own name.)   You can be Joe Blow, Upholsterer, or just Joe Blow, but anything else like Blow's Superior Upholstery,   Acme Upholstery, etc. requires either a DBA or some form of incorporation and filing with the state.

You should also get a Federal EIN, easily done with one phone call.  Otherwise, you will have to give your SSN to customers if they request it (generally when you've done more than $600 worth of business in a calendar year).  Easy to do if they are a business or you subcontract to them.

It sounds like you need to buy some time with a CPA firm and maybe a small business lawyer.   I can also recommend a through reading of this book,  http://www.amazon.com/Small-Time-Operator-Bernard-Kamoroff/dp/0917510186d (regularly revised, so get a current copy).  

You need to get an accounting system set up.   I use Quickbooks.  You can do pencil and paper, but I would not wish that on anyone. I set up my chart of accounts with the assistance of my CPA (wife) with a keen eye on IRS Schedule C.     Failure to have a firm grip on your P&L is a sure route to business failure.