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Starting a Home PC repair service, EULA and liability help?

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#1
Hello all, i know there have been several threads about pc repair business but this is a little more specific. For background details i originally was just helping out friends and family, averaging 1 pc every month or so. But lately i've been getting more like 1pc every week and that's just from previous friends/family recommending me.

So i've decided to go somewhat official and start posting around town and at college bulletins, if allowed, advertising Windows PC repair for laptops and desktops. Now mind i still have a full time job managing my family's store so this is just some work on the side unless it really takes off.

My question and request is for some of you to review the EULA(if that's the right term) and liabilty agreement papers i drew up this morning that are attached. I believe I've covered my arse but i'd appreciate any tips and opinions on the papers as well as in general when doing this.

I currently only charge $5/hr on top of the other work specified in the EULA as i'm just starting up and well i make a decent living now and just love fixing pc's. Only so much one can do to their own until there's nothing left to fix :)

NOTE: had to upload in .txt as odf(open office) documents won't upload for some reason.

EDIT: Updated uploads should anyone else wish to use what i've written as an idea for their own feel free to, just be sure to change the names ;)

EDIT 2: Updated to just one paper being signed to simplify it. technically would save me half the paper aswell :).
 

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erocker

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#3
seems like an awful lot for something just on the side.
 

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#4
Well, if you want a legit business you gotta be legit yo! Otherwise if this is something you're not going to pay taxes on or "not legit" I don't think any kind of paperwork is necessary at all. However, this is the best way to protect yourself from people suing you if you blow up their computer or something.
 
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#5
haha yea very true. another question i just thought of. How do i handle someone who doesn't pay or "can't afford" to pay"? it'd be unlikely as the most i've charged is $80 bucks. but still i'm not sure how i'd handle that situation and how i should put it in writing. thanks

EDIT: hmmm then i'd have to think of a business name. UMP Tech Repairs. since i do some work on handhelds though not too much experience in them right now.
 
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#6
Doesn't seem like a business at the rates you want to charge. Seems more like a hobby. IRS has rules about having to turn a profit in so many years or it is just considered a hobby. Don't see how you can turn a profit with those low rates. If it is just a hobby, you don't really need the paperwork. If you want it to be a business, you need to get all serious as erocker stated and re-think what you are going to charge so that you can actually make money at this. You can keep it at the hobby level too, but you lose the ability to deduct any related expenses from your taxes when you do that.
 
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#7
well i wouldn't turn a massive profit. as i said i do have a full time job working 40+ hrs as my family's store manager. but there would be profits, the majority of pc issues can be fixed with no cash out of my pocket, least from my experience. And i understand the paperwork part with the IRS, this was more of a question on how well it would cover me if someone states "that's not right" or 2 weeks from now "you broke it!" ya know. So the paperwork is more of an insurance for me so i can just say, "you signed here, which means you knew XXXXX". My wife, father in-law, and a few old customers tell me i need to go full out and charge more. It's the other thing I've been mulling over.
 
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#8
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#9
I'm reading up on the LLC link erocker provided. It seems fairly simple, i know my in-laws use an S-corp for their 3 businesses and the paperwork and taxes are horrific. Now i just need to dig up how much the costs would be for the licensing of an LLC.
 
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#10
I'm reading up on the LLC link erocker provided. It seems fairly simple, i know my in-laws use an S-corp for their 3 businesses and the paperwork and taxes are horrific. Now i just need to dig up how much the costs would be for the licensing of an LLC.
Whenever you find out can you let us know? I'm fairly curious about it.
 
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#11
If you are planning on only doing it on the side, then you'll want to charge more than $5 per hour. Youmay have more call outs than you can handle (with 2 jobs) for $5 an hour. If you can't meet demand, your business will fail quickly.
 
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#12
I received PM from a respectable member, as well as reading all over the web and forums and decided to charge to $10/hour. the area i live in as well as surrounding towns are for the most part, low income, so i can't charge too steep a price to get business. I also want to stay below my competitor's(about 25minutes away) pricing. I've heard from quite a few people that went to him before me that he didn't fix their issue, and he had poor attitude, and charged a lot.

One of my first client's said her computer was slow, he said it was a memory issue so he changed the HDD from a 120gb one to a 250gb one and charged $220. Course it didn't change a thing for her because she only had 512mb of memory, i told her so, sold her a 1GB stick and installed it and charged her $25 for the stick and 15 bucks for the dusting/case clean-up i did(20minutes) and installing the stick. She said she'd never go back to him, in fact i think she's the one that told quite a few people about me.

@cameronh779: i will. might be a day or so. I may do a sole proprietorship instead of LLC, lot less paperwork from what i'm reading. Plus my Liability release should cover me on all ends. did anyone else review my papers in OP? I've updated them since last upload
 
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#13
Well, if you want a legit business you gotta be legit yo! Otherwise if this is something you're not going to pay taxes on or "not legit" I don't think any kind of paperwork is necessary at all. However, this is the best way to protect yourself from people suing you if you blow up their computer or something.
This. I knew a guy that was doing 10+ a month, house visits, etc. He did a custom gaming build, the buyer decided to break the case seal and tinker with the water cooling, and ended up getting a leak and smoking a couple components. The guy I know took the PC back, fixed it, got sued for well more than the buyer had invested and pretty much broke him. This was without an LLC to protect him and his personal assets from his business assets.

If you don't want to go legit, and really for what you're charging, it probably isn't really viable, keep it as a word on the street kind of thing maybe?

You're not charging very much at all..I was charging $30/hr last year for on-the-side work, doing several a week. People willingly paid. Where I work now charges closer to $100/hr. But also, you don't want to overcharge or oversell yourself in skillset, capabilities and time. You might bite off more than you can chew. Really I don't think 1 a week justifies going official.

When you're pushing 5 or 10+/week, you might want to consider going for it, even then that's not really THAT much work, especially if you're not charging enough or able to meet parts replacement demands. Otherwise, keep it at a hobby status. What you do with and how you claim the income is none of my business.

Regardless, keep going for it and keep making it happen. If you really want to do this, you will end up doing it. Just don't be in a rush. You have a steady job, keep it, keep this as a side job. I don't know what certifications or degrees you may have, but those can help customer confidence even more-so when customers don't know what they mean but know you have them. Things get very complicated when you go to small business status. I've had a hydro dipping business for going on 3 years now. It's taken a lot of time, effort and financial investment, and it's yet to provide me a paycheck, but that's a different story for a different day. Store fronts, shop, equipment, advertising, etc. It all adds up against that bottom line. Though you can claim a lot of expenses on the business for tax purposes too which can be a real benefit.

Sorry, end rant. I vote keep it as a hobby, do side work for fam, friends and referrals, don't go for small biz yet. If you gotta bad feeling about someone, turn them away. If you get popular, and are at a point where you can afford it, go for the LLC, then build up the biz until you can leave the day job. No sense in going all in on a business with less than 10 PC's/week imho...because even that number won't keep the lights on, let alone vehicles fueled, you stomach fed, etc.
 
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#14
i see you're point kursah, though i don't fully agree with it. This is meant to be i suppose you could say a hybrid of hobby and business. Since i was 14 i've always wanted to go this route with my career, however i am wary of starting a business due to that fact that i don't know much about the specifics of it besides the headaches i've helped with for my in-laws' corporation.

My thing is 10+ a week would be about 20-40 extra hours a week on top of my current full time job, doesn't a lot much time to spend with my 1 year old. With 10+ computers a week(~$500+) i could almost live comfortably. I have no house payment as it's been family owned for 2 generation prior to me, both vehicles are paid off, other than basic bills i have no expenses. I'm also one of those people that was poor growing up and have yet to do what most do, learn to live on whatever i make, i still live on what i'm used to having: all my needs and just the occasional want, not every want my paycheck can afford.

I suppose I feel that since i'm getting 1 person a week or so without putting ANY effort into it myself, if i do put up fliers all around town in stores, and my wife's college, surrounding towns, i'd get quite a bit more business. Especially since my references(already asked them) on said fliers are well known throughout this area. I just thought before i possibly got loaded up on jobs, i should have some insurance(the liability and EULA) and go ahead and make it a business so i can't get in trouble for under the table work should someone "official" hear of me.

EDIT: Also kursah, did said person have papers that had to be signed such as mine?

EDIT 2: Well i checked here to see if i needed a license or permit. Apparently neither is required in my state for computer/technological services.
 
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#15
The reality is if you can't afford the business and it can't sustain itself, you'll need to A. get a big loan, B. borrow money (see A.) or C. you better have a solid customer base or special ability or feature that makes you appear to be necessary.

10+ a week could be as little as 10 hours a week too..or less...depending on what you're doing. I was working 60+ hours/week as a mechanic at a dealership and then I'd get off work at 6-7pm, and work till midnight and then all weekend on my business...good luck finding comfort. If you want to make your business work, you better live for it and make your life revolve around it for at least a couple of years, at least. And expect minimal returns, so living cheap and light are really helpful here...or a dayjob and maybe a shit ton of crack (j/k). Knowing how to live poor is a good skill..I grew up poor too, and live in a beautiful place with low wages and expensive living...so I hear you there. I wish I had a house...but at least I paid off my vehicles prior to leaving my good paying mechanic job. Being a grease monkey just wasn't for me after 10+ years.

I have kids too, and it was very tough, now I tossed college in the mix to get an IT degree in Network Administration...so now I stepped back in my biz, I handle the website and youtube vids, work at a local PC shop and do school...but all my time is still consumed.

The guy I knew had a small biz license as that's one of the requirements in Montana, but he did not have the LLC protection. I'd have to call him to find specifics...he got out of it after the lawsuit cleaned his savings out and he and his family almost ended up on the street.

If you're gonna do this business thing, get some certifications, Microsoft and A+, maybe a degree, yes referrals are huge...get their permission to be publicly advertised. And go all in with what time you don't spend at the job that pays the bills. Or it will be a hobby. And maybe it'll be better kept as a hobby until you end up too busy that it needs to take that next step. I think you're moving faster than you are capable of sustaining...and I mean no offense by that, and I don't know the situation beyond what you're stating. I'm just speaking from my own experience and watching so many others do the same thing and fail. I'd rather see you be successful. If you are not willing to put the time into it, live it, become it, it will not happen. There's too many others out there that have, will and do put that time in that will get those customers you won't have time for or have a waiting list too long for...people will pay for convenience, they will pay greatly for it. The people you get that pay $10/hr for pc repair in a week or two or three, depending on how many a week you deem is acceptable will be the ones that don't need much or are close to a referral and don't NEED their PC's for anything important.

I work at a place that charges up to 10X that, and even with less than one-day turnarounds on many jobs, heck many are done in an hour or so (speaking repairs, upgrades, etc. from walk-ins, not including remote remediation, network design and install, etc), people are still impatient...but the impatient people pay very well.

Please don't take offense to what I say...but I don't want to sugar coat it and tell you, " ya go for it, you'll do great!". Sure you might...but it's gonna be slow and really only 1 PC repair a week for some cash in your pocket is a hobby. It's no different than my 12-year-old mowing lawns for arcade money.

If you can't make the time to do it, people will go elsewhere and you'll go from good referrals to shitty ones in a hurry. A note to remember there is one bad referral can do more to your reputation than 10 good ones. Pissed off people tell more people why they're pissed than happy people tell people why they're happy. I don't know your market, but I do understand being broke and starting from the bottom.

I honestly think you need to keep it simple. Making it a small biz is adding a layer of complication it sounds like you might not be ready for in more ways than you feel you're ready for. Take the time you have to research it further, speak to lawyers...if your families' biz lawyer can take a few moments to give you some pointers, etc. Make a business worth paying for. Because it will cost you. A. Lot. And then some.

That's my thoughts. The possibility of getting loaded up on jobs also is contradicted by you stating you can't handle 10 PC's a week...you need to figure that out...you either can your you can't...but honestly 10 PC's a week would be my minimum for even thinking about becoming a business...but that could be my personal preference and wanting to know I have a good thing worth going for with consistency.

You should go for chasing this dream, but I think it needs a little more foundation. :toast:
 
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#16
What you are describing here is either not a viable full time employment option, or something you're going to have to access more accurately in order to determine how you progress. Let's take a look at what you've given us.

Case 1: This remains a hobby.
This is probably what you want. In order to get this to work you're going to have to get some sort of release signed prior to working on any computers. This release has to include both hardware and software issues, and should make note of what data you intend to be accessing. The hardware and software is straight forward (I may break it, but am not responsible for replacement if broken), but the big kicker is data access. Consider for a moment if you ran a system scan for viruses, and found a cache of child pornography on a drive. You're obliged to report that crap to the police, and you need to protect yourself. Barring that kind of true horror, people need to know that you aren't sharing their personal data.

No EULA is viable here, because you aren't providing a product. An EULA, or end user license agreement, is provided to inform a consumer about what their rights are in relation to usage of a product. A simple release sets you free of concerns, sets pricing prior to work, and allows people to be sure you are operating under a set of rules.


Case 2: This is a viable new career.
You don't seem to have the business acumen for this. Please excuse my bluntness, but you've got to see this. Assuming you form an LLC, you've got to have some actual business. Sure $5 per hour makes sense now that you are doing things under the table, but what happens when you form a company. You'll have overhead for operation, mandatory health care payments, and dozens of other things that cost money. Even doubling your cost to $10 per hour might lead to an operational cost of $15 per hour.

Even assuming that the business is viable, how much do you really have? Think about the demographics of your area. You say that the place isn't flush with free cash, so how many people actually need computer help? Do you have a steady stream of computers coming in for the next 6 months, 2 years, or even the next decade?

Your competitor looks comparatively bad because they function as a business. $20 per hour might only be $10 in overhead, $2 in profit, and $8 in employee labor costs. At that price they cannot afford to hire immensely skilled labor, so they recommend things that will make them money and don't always satisfy the customer. $220 for a HDD is about $60-$90 in parts, with about ten minutes of actual labor.

On the flip side, they could charge $100 per hour, and get competent people. That half hour diagnoses would lead to a valid conclusion, and 10 minutes of labor would have yielded a fixed system. That would be $67 in labor and the cost of parts, With $20 per hour you received advice that was wrong, but you only paid $13.34 to get it (assuming the same time for billing).




So, I have to ask if you're dedicated to this. There are very few people without business acumen, and with a relatively low level of customer services, that can make a living. My fear would be being in your shoes, and having a college kid come in and accept under the table payments at half my rates, killing my business. If you insulate yourself with a simple (and legally binding) release, you can continue doing this as a good side job for some extra money. If you want to make this a business you need to do a lot more thinking about it.
 

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#17
I did this and almost got sued. It took me alot of talking to unfuck a situation where I did an optimization on a girls PC she was around 17 or 18 and almost over not managed to get a virus. That caused SERIOUS problems. She ended up paying me in the beginning for the work on the machine,. Money that wasnt hers. then rendered her PC inop and when she brought it to her parents attention that her PC didnt work it eventually led back to me. Shit was nuts. Sat down with the parents talked it out dad was a dick head mom ended up saving it from belly up. I had no paper work no contract shit was scary NEVER AGAIN.
 
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#18
I did this and almost got sued. It took me alot of talking to unfuck a situation where I did an optimization on a girls PC she was around 17 or 18 and almost over not managed to get a virus. That caused SERIOUS problems. She ended up paying me in the beginning for the work on the machine,. Money that wasnt hers. then rendered her PC inop and when she brought it to her parents attention that her PC didnt work it eventually led back to me. Shit was nuts. Sat down with the parents talked it out dad was a dick head mom ended up saving it from belly up. I had no paper work no contract shit was scary NEVER AGAIN.
Yea well that's a little bit of difference. I do have papers that will be signed or service will be turned away. At lilhasselhoffer, i realize you are only offering advice but stating i don't have acumen or quick decision business abilities is a bit of an insult. The only quick business decisions i'd have to make are how to handle customers and believe me, being a store manager and having worked front counter/customer service jobs over the past 6 years has made me quite a people person so i'm told.

As for overhead....i'm trying to figure out what overhead you guys are speaking of. The only overhead i would have literally out of my pocket is, correct me if i'm wrong, paper for printing the release papers, printer ink, buying receipt booklets, and i suppose pens. Other than that any replacement parts, thermal paste, etc is all paid by customer so i'm not seeing but maybe 50 bucks in overhead a month. I also plan to make business cards but they're like $8/1000 cards through the person my father in-law knows.

More or less you guys are stating do the business i would do but keep it as a hobby and forgo the Business idea. Here's my question at what profit point does a hobby be deamed a business and at that an illegal business? I'm sure it'd be different per state but a rough average. If i can work on say 10 pc's a week and legally keep it a hobby, great and just what i wanted from the start; but seeing as how that'd probably be about $10,000 a year revenue i can't imagine it would be legal.
 
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#19
Yea well that's a little bit of difference. I do have papers that will be signed or service will be turned away. At lilhasselhoffer, i realize you are only offering advice but stating i don't have acumen or quick decision business abilities is a bit of an insult. The only quick business decisions i'd have to make are how to handle customers and believe me, being a store manager and having worked front counter/customer service jobs over the past 6 years has made me quite a people person so i'm told.

As for overhead....i'm trying to figure out what overhead you guys are speaking of. The only overhead i would have literally out of my pocket is, correct me if i'm wrong, paper for printing the release papers, printer ink, buying receipt booklets, and i suppose pens. Other than that any replacement parts, thermal paste, etc is all paid by customer so i'm not seeing but maybe 50 bucks in overhead a month. I also plan to make business cards but they're like $8/1000 cards through the person my father in-law knows.

More or less you guys are stating do the business i would do but keep it as a hobby and forgo the Business idea. Here's my question at what profit point does a hobby be deamed a business and at that an illegal business? I'm sure it'd be different per state but a rough average. If i can work on say 10 pc's a week and legally keep it a hobby, great and just what i wanted from the start; but seeing as how that'd probably be about $10,000 a year revenue i can't imagine it would be legal.
Please don't assume that I'm insulting you. Stating that you don't have business acumen is not meant as an insult, but an honest judgement of what is being put forward. Business acumen is entirely divorced from being good at what you do, or having a useful skill set.

You've come forward without understanding of some basics that are required for starting a business. If you believe that is an unfair statement, give me answers to the following questions within 5 minutes of reading this, and make sure the numbers are 100% accurate.
1) How am I going to setup the business (LLC, Scorp, incorporation, etc...)?
2) What do I need to file in order to do this for my business, in my state?
3) What are my operating expenses monthly?
4) What is my customer base?
5) How, where, and how much does it cost to advertise my service?
6) What do I need to charge per hour, based upon my established customer base, to cover my overhead and expenses?
7) When do I break even, and when do I actually start earning money (after the initial investments into resources required to perform the service)?


To my understanding, none of these questions have been answered by you. What you have is a lack of business acumen, but a valuable skill set. This is not an insult, but it does offer you some insight into how to proceed.

$10,000 per year seems insanely high for what you are quoting. At the rate of $10 per hour, that's 1000 hours per year, or about 20 hours per week. You're only charging half that per hour of service right now, so you're looking at a 40 hour per week job that has a gross income of $10,000 per year. If you can live off of that, then I am completely baffled.

The reason we are saying to keep this as a hobby is simple. You've proposed a service that utilizes your talents. The service is not something ongoing, so your customer base doesn't replenish. People don't bring their PCs into you for an oil change every 3000 mouse clicks, so you don't really have an ongoing plan. That is a recipe for financial disaster, given the best of circumstances.


Now all of this doom and gloom is actually assuming the best. Imagine one law suit leveled at your business. If you aren't properly structured they could pursue you personally for financial damages. That home, those cars, and everything you've worked so hard for is gone in an instant. What then? You've now got to get a job making substantially more money, just to break even. That sort of life sucks, and if possible I'd never like to see it inflicted on anyone.

Please, take these comments as the closest thing to love the internet can provide. We are trying to protect you from making a decision that will almost definitely damage you, despite having the decision made for all the right reasons. At your current charge rate you'd be adding on another full time job's hours to be making a $20,000 per year gross profit (assuming you could drum up that much business). That would amount to somewhere significantly south of that much money actually going into your pocket.

Keep your computer service business on the side. If in 6 months it is still booming, consider educating yourself on more advanced IT, and actually changing your career path. Leaping on this plan right now will lead to disaster, and I would prefer not to feel culpable for letting it happen.



All of this said, it's your decision. Coming to a technology website forum, and asking business advice is somewhat of an odd action. If you believe your business actually has a plan, and a chance for success, then there's one simple acid test. Get your documentation and plans together, go to a bank, and file for a small business loan to cover the initial investment into materials that you'll need in order to build the business. Remember that this plan should include what you need, how much of it, the cost for each item, and a plan to develop the business. Remember that advertising by word of mouth only provides so many opportunities, and you'll need something else to develop and sustain a customer base. A loan officer will pick apart your plan, mercilessly point out any flaws, and approve you if the business is an acceptable risk. In the current state, this plan would likely take about two minutes for a loan officer to eviscerate. It may not be good for ones ego, but that kind of honesty will give you perspective on what it is you are planning to do.


Edit:
I can't see you making several thousands of dollars in actual profits per year. You have quoted a $10,000 per year profit, but that kind of thing means you're putting in some pretty insane hours. If you are putting forward that kind of time, then you need to evaluate this sort of thing with either a lawyer or a tax professional. Each state has different rules and regulations governing taxable income.

I cannot say this with any sort of legal backing, but money under the table for a service is money that you get entirely. No corporate taxation, income taxing, etc... It may not be ethical or legal, but it is much more profitable than other ways of earning money.
 
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#20
This is a long version of what you may be getting yourself into and I was just like you, wanted to charge nothing, so it would be nothing. You will find you are a valuable asset to real people because this is obviously some sort of passion of yours.

Please don't read if you hate life stories :)

I started tech-ing around Windows 3.1(1996ish), upgraded ram because i couldnt play Dragons Lair due to Insufficent Virtual Memory. Then i found out the hard drive was full. Then I found out ZIP Drives. Then I found GEOCITIES. Then I found .MP3s. Then I couldnt get off the damn computer. I tried school and have taken classes since Windows 2000 Professional. I have never completed my darn A+ or any other certification for that matter but have nearly 40 college credits. My "real jobs" before computers were serving/bartending. My life revolved around partying & restaurant girls, luckily the plural was a continuous "s". But I wanted change.

I found a job at Staples, selling office equipment and was there for the launch of EasyTech. I was named the lead and hired a couple guys I went to school with. We had no internet connection, we had no guidance, we were winging it but luckily we were very good at slip streaming SP2 for XP and then VISTA came. I ran away from that place SOOOOO fast and went back to bartending.

I then was talking computers with everyone I served and worked with. Thats when the PCs started being handed to me.

Computer repair as a hobby in the beginning is very rewarding because of all the horror stories and dirt-hats you hear that are out there. You show Grandmas and Grandpas keyboard shortcuts and they think you invented the wheel. You show your Uncle MSCONFIG/IPCONFIG, he thinks you have a degree. You upgrade ram for your buddy, he wants you to build a gaming rig. How FUN is THAT!

I started your very venture around 2006 and went "donation" based to keep a casual understanding. I never once had anyone sign anything and luckily never fubar'd a PC.

Boy did that get me more than i could handle! Before you know it I was entering several homes & businesses a week. I quickly adjusted my rates because like a wanted man, the reward is high. I went to $30/hour for on-site and had no problem getting that. If I took something home, I would charge flat and very reasonable rates because nearly every PC I worked on I saved their data and REinstalled Windows XP(thank Gates for TechNet). I occasionally ran into the "wheres my program" people but I usually was very clear up front of what the goal was. "I will make you feel like you PC was like it was day 1, without the bloat but that means no software" Nearly everybody told their friend, etc etc. I had 3 - 5 PCs/House Call to work on a day! I learned WAY TOO much about everything and nothing at the same time but was very happy doing these tasks and getting smiles. I still reported it as a hobby because I had no intentions of going LEGIT.

Walking downtown, I saw an office, only $300/ a month. WHAT! I though legit meant $1000's! I wanted to go legit!

About a year after I had started this side hobby, I had an office, clients and a windows/mac decal on the back of my truck that said "Hi, I Fix and Sell Computers." My office was nothing crazy but something to keep all my PC stuff away from home. I was still bartending nights and playing golf nearly everyday. I was on top of the world.

Then the PHONE CALLS. More business, meant more work, meant more follow up. Holy crap was I in over my head but kept at it and QUIT MY JOB.

About 2 months into the office, I had already pitched a 20+ office company contract (me and a friend(from staples) fixed their server during the interview but didn't get the contact. Just a nice thank you card.) I built a front page of a website ( I am terrible at design but tried and failed!) and I had "cracked" an ACCESS database for a company and converted it to Excel so they no longer had to pay monthly dues (easiest $2000 I ever made) All of these were over my head tasks but I took them on without hesitation building my versatility, knowledge of my limits and "balls". All of this was still while getting 1-5 PCs/House Calls a day.

Then I got a call, my friend got a call from a HUGE LA clothing company and asked if she knew any "hackers". She called me, my golf game felt offended, my computer skills felt under-qualified. However, she had some computer issue while I was on the phone, I told her to do 2 things and it worked. Needless to say the company called me the next day haha. I flew out, met execs and showed them all the weird things I knew about what I felt was nothing. They were blown away, partied for about a week and flew back home. They paid for everything! A day later, they call again and say they want me to manage a SEO project for a minimum of a month and what I would need to do that. I calculated my $30/hour plus expenses and said $400/day, they said you're flying out tomorrow. I had an apartment waiting for me and someone picked me everyday to go to the MASSIVE warehouse for a couple hours a day. I was again in over my head but went for it. Their IT team was over 50 people and they looked at me when I started describing what my SEO plan was and had no idea what the hell I was saying. Basically created a farm of side interests of the company/owner to push down the bad publicity. I was pinging the IPs of the sites we didnt want up in the searches. Jumping from hotspot to hotspot. Learned Cain and Able. Kept pumping content on all the domains I was creating and Somehow it worked haha. Thank google's shoddy algorithm(back then). This was the first 2 weeks, the next few are still a blur as I was in LA partying with these crazy people who thought I was a genius hacker. I was very un-confident about the actual work i had done and hadn't proved anything to myself. That month was over and I flew back home. They asked for an invoice and I had a $8000 check in a couple days. I was stunned! I was going to be 1099'd. Had no idea what that meant and kept going.

I then consulted a business accountant and she tried to whip me into shape. KEEP ALL RECORDS she said. (rigggght) I had to have insurance for my office(contents and liability), for on-site(in case anything happened to me or their equipment) and invoices/reciepts for all income and expense.

I didn't want to be legit anymore haha. I moved my office by the golf course and started doing more jobs. Then ended up working for the golf course as an employee and dropped the office. Then I moved to WA and had to take a job again at staples (uhhhhh boy have they changed for the worse, I was a tech but was pushed to stop working on a PC that was due in an hour to try to sell warranties all day) but then luckily landed a gig with a startup and relearned Google's algorithm and got deeper into SEO the last couple years.

But I wanted my independence, so I am back to doing my own thing and have a LLC set up

SOOOOOO....

If you want to run it as a hobby, you will report as OTHER INCOME on your 1040. You can still write off expenses and I would recommend you do so. Keep business card costs, flyer costs, hardware costs, etc. There is no determined amount that deems a hobby but that OTHER INCOME is taxable as the IRS will want their .02, even if its .02. Depending on the amount, you may get a letter from Social Security saying hey for your future and for us we need you to pay x % also.

Once you get rolling, you will want to take advantage of the deductions available to you. Mileage, home office, internet, cell phone etc.

You have options. Set up a Sole-Proprietorship or LLC

Sole-P you will have a larger tax liability and MUST pay into Social Security based on NET PROFIT(Income - Expenses) but its less upfront paperwork and you fill out a schedule C

LLC, you are now a Corporation and you can never personally be liable for issues. You pay yourself as an employee and the company is responsible for half your tax and ss liabilities. Get a good accountant.

I still didn't have anyone sign something. I have had a couple bumps but I am very casual and make it up to people 10 fold. I tried to solder a power jack ooops no go, here's your data and your laptop is toast, no charge.

I plugged a power supply in POP, I'll buy you a new power supply.

Honesty can only go so far though. Protect yourself somehow because there are sue happy people out there and I don't want to see you on Judge Judy with her getting mad at you because you arent a legitimate business.

Judging from what I read from you, I would say you are 20 - 24 years old. At that age the last thing I wanted to do was join the "government way" but 10 years later I say its for the best and will make you a better man. Plus that 1 year old will have a better life/future, if you do it right and that will give you all the satisfaction you could ever ask for.

Go at it as you wish and you may learn some hard ways but sometimes thats the best way.

Keep in mind the "hey quick question" phone calls that will start. Those frustrated me once they got to be 5+ a day. There are many things I skipped over but just enjoy your life and craft, good things will happen.

Best of luck.
 

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#21
I can't emphasize how much you'll want an LLC. I've seen significant small businesses get taken down because liability on the owners end trickled from the company to them. Eventually it all caught up to them and they started having financial and issues with the law and it all came back and bit them personally, all because they didn't incorporate or form an LLC. If your serious about this, cover your ass. I can't stress that enough.

@Sasqui I've done the same thing and I live sort of close to you. Fortunately I didn't run into the issue that you did, but it could have easily not turned out that way. Whenever your going to work on someone's computer, always have some documentation that says what you are and are not going to do and that the person is giving you permission to attempt to fix the computer. With that, you could have said that their daughter came to you, had x, y, and z issues, and you attempted to resolve them. Then continue to tell them that their daughter needs to stop watching porn if she doesn't want viruses and that nothing you did will fix her stupidity, except in a nice way. :)

I went to school at Plymouth State University and I used to do help desk work up there and despite Plymouth having liability protections up the wazoo, we still made every person who brought their computer in to sign a basic waiver.
 
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#22
well i suppose i can just do it as a hobby for now and still post up advertisement papers around the area and maybe make a FB page. Lots of insight here fella's; longggggg responses and short ones are always welcome and if someone takes the time to explain a response i figure they deserve it read. There's a lot of support here and i appreciate it. I'll go the hobby route and see if it picks up enough to be worthy of a business.

@ChiSox: correct i am 22 :)

lilhasselhoffer: said:
1) How am I going to setup the business (LLC, Scorp, incorporation, etc...)?
2) What do I need to file in order to do this for my business, in my state?
3) What are my operating expenses monthly?
4) What is my customer base?
5) How, where, and how much does it cost to advertise my service?
6) What do I need to charge per hour, based upon my established customer base, to cover my overhead and expenses?
7) When do I break even, and when do I actually start earning money (after the initial investments into resources required to perform the service)?
1) I spent hours researching last night, decided a sole proprietorship+liability insurance would be best route for me.
2) To file as a SP I just need to get a business license, no license nor permit exists in wv for what i'd be doing.
3) Expenses equate to what i said before: paper for contracts, ink for printer, receipt/ticket booklets, pens, and gas for home visits/driving to pick up PC
4) customer base is technically unknown since i've only done friends, fam, friends of friends work. that was without any effort on my part. Was thinking the potential may be there if i do put in effort. This is the biggest "unknown" of my plan
5) How: the shops/stations/stores/wife's college posting up fliers. Cheap, but this area operates like is 1980 trying to live 21st century, they still need technology but don't like it so fliers is right at home. Where: client's home or my home, no official office. Cost: Guestimating ~$100/month initial month+$125 for SP+insurance startup. consistent monthly expenses ~$50/month
6) No established customer base yet, minus a couple friends. Even then $10/hr would cover my monthly expenses, however that does make it more a hobby.. Course i should only have to buy paper and ink maybe once every 2-4 months so.
7) i would say including initial start up costs it would take maybe 2 months to break even. Or better estimate is about 7 clients. after which each month would need 1-2 clients to break even.

I shall just do what i was planning minus setting up the Sole Proprietorship, still post up around town and outlying area's and see what happens.

NOTE: to some posts that keep speaking of getting sued, liability and whatnot. Did my OP not get read? i don't believe not a one of you read or had a response that indicated you read the Release i'd have people sign before working on their computer.
 
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#23
Just as a hobby, i still want to make a "business" card and post the fliers everywhere. Would you all do something similar? I plan to no matter what, but I want your opinion on my next step of skipping the post proprietorship and just doing its as a profitable hobby.
 

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#24
my recommendation is to not form any official business repairing computers. there is no real money in it and the amount of legal work you have to do won't be worth your time.
 
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#25
Just as a hobby, i still want to make a "business" card and post the fliers everywhere. Would you all do something similar? I plan to no matter what, but I want your opinion on my next step of skipping the post proprietorship and just doing its as a profitable hobby.
I'm with you 100% on doing this as a hobby. A decent flow of income doing something you like is awesome.

I did read the original posts. They concerned me because they have some pretty vague terminology. You don't seem to be the kind of litigious jerk who is capable of writing them, and I'm not capable of doing much better than what you've posted. A lawyer might charge you $100 for an hour of consultation, but you can purchase a pre-produced form from them. They'll know the legal system better than either of us appear to, and should there be a question that lawyer is generally bound to respond because they provided the form and accepted payment for their professional services.

Remember, there is legal liability out there that forced chainsaw manufacturers to write "Do not try to stop moving blade with hands or genitals." Litigious people will always try to find a way to hurt you if they can. By having a professionally prepared release of liability, and by keeping this business as a hobby, you're doing the most reasonable thing that I can imagine.
 
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