I have been baking for a while now and am wanting to bake for more than just family (and so I'm not going broke with this hobby). I live in Ohio and have read over the Cottage Laws, I have a food scale and know how to label things I make properly. I have figured out my pricing so I'm not undercharging and have made some basic forms.
I need help figuring out how to figure out tax information (I know I need to talk to an accountant, but don't know what to expect to pay). Do I need to have my forms looked over by a lawyer?
And lastly, what's the line with copyrighted images? I know licensed characters and team logos need permisison to be used, but what about some of the designs I've seen recently--clothing brands/labels, tools, specific purses. Is it ok to replicate a Coach purse for a client or do I need permission from Coach? I recently turned someone down becuase we couldn't come to an agreement on this--she wanted a Wiggles cake and didn't want DecoPack or a just a red convertable, she wanted the Wiggles car with the logo.
Thanks for all your help CC-ers! I've learned so much from you all!!!
As far as the taxes go, my accountant gave me all the info that I need for that. I think each state is different on taxes.
For licensed characters - this thing sucks! I am not sure how others in a custom cake business handle these requests! I get so many people wanting cakes like that I have to turn down numbers upon numbers of cakes. If people want the deco pack designs that look exacly like the cakes at chain stores than they wont pay me for my custom cake prices.
Hello Ohio! If you are a cottage industry selling only food products then all you need is to fill out a schedule C and file it with your 1040. It's far easier than you'd think!
The simplest way to keep stuff organized for tax time is to look at all the categories on the schedule C, decide which ones will apply to you, and then get big manila envelopes labeled for each of them. As you make purchases and sales, add the receipts to the folder and note the amounts on some kind of ledger (could be just a sheet of lined paper). Then when tax time comes around you only have to plug the ledger totals into the right category. Easy as pie! (or cake)
Now I would only recommend that method if you are just beginning and have no real sales volume to make it worth buying some kind of accounting software. You could find or make an excel spreadsheet to keep all the numbers organized (still keep your receipts!). There are various free spreadsheets online and you might be able to find one that you like. The best resource for free spreadsheets I have found is Google Documents, but you will still have to play around with them until you find the right fit for your business model. Once you are more established and have the sales volume (and spare cash!) I would definitely recommend finding a more professional accounting program to keep everything orderly.
I hope this gives you a better idea of things. Good luck!
If it's a licensed character and you don't have a license to use it, you can't use it and sell it. If you have the Decopac kit you can sell those EXACTLY as they appear on the Decopac photo, you can't move them around into different positions. This goes for purse logos, college team logos, cartoon characters, NFL teams, etc. If they want to buy a toy and stick it onto the cake that's up to them, but you shouldn't have anything to do with selling the toy.
If someone calls me and asks for a character cake, I tell them this "I can't do that becasue it's a copyrighted character. Sorry I can't help you." There's no discussion of it.