shanewatson2548: Being a minor and legally accepting payments online?

Newbie

Join Date: May 2010

Posts: 12

I'm under 18, but I'm ready to start an online business - specifically a company that specializes in getting other young internet users their own custom websites.

I have the funds required to start such a business, but I'm worried about legally accepting payments online. My parents would be willing to sign off on anything, but not willing to use their own accounts for anything (eg. making their PayPal into a business account with their name on it) - don't ask me why, they just aren't willing to do that.

I already have a PayPal Student account, but from what I've read in their TOS and from other people online is that I can't operate a business with that account - that I run a high risk of being limited.

Does anyone have suggestions from payment processors that allow minors to take payments as a business? Thanks in advance

Newbie

Join Date: Sep 2012

Posts: 5

You might just have to wait until you're 18

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You'll need to have a parent or legal guardian obtain the gateway accounts. The only way around this that I am aware of is to be emancipated, but you'd want to talk to an attorney and, honestly, I wouldn't recommend that route.

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Premium Member

Join Date: Aug 2012

Location: localhost

Posts: 487

Since you are not 18 and assuming you are from USA , you can not legally sign any contract nor own any business. Thus you can not accept payment online ( and offline in various situation).
I would suggest you to hold onto your fund and wait till you are legally mature

--Roel.

Corporate Member

Join Date: Feb 2012

Location: Memphis, TN

Posts: 1,881

The way to do this is to have a legal entity.

Then you provide your business details, EIN etc. Certain areas allow states to be registered at lower age levels so just research.

Just find a place to register with no age req. =)

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Premium Member

Join Date: May 2011

Location: New Zealand

Posts: 603

From what I hear you can do is to get your parents to register your business and you be the only employee of that until you're 18 when you'll then be legally allowed to "take over" the business.

Newbie

Join Date: May 2010

Posts: 12

Hm, perhaps I phrased my OP wrong. I don't really want to register an official business, but I want to be able to accept maybe 50 transactions a month, and then be able to use that money.

Is there a way I could do this by myself?

Premium Member

Join Date: May 2011

Location: New Zealand

Posts: 603

Quote:

Hm, perhaps I phrased my OP wrong. I don't really want to register an official business, but I want to be able to accept maybe 50 transactions a month, and then be able to use that money.

Is there a way I could do this by myself?

I would honestly recommend that you do register a business. Especially if you're selling something.

Would your parents not be happy about being the "account holder" for the PayPal account where from their it can be linked to your bank, card and what not?

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Join Date: Feb 2012

Location: Memphis, TN

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Quote:

Hm, perhaps I phrased my OP wrong. I don't really want to register an official business, but I want to be able to accept maybe 50 transactions a month, and then be able to use that money.

Is there a way I could do this by myself?

Considering you would have to pay taxes etc. You should really know what you are doing. You could also be putting your parents in a liability situation.
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Join Date: Apr 2009

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Our 16 year old twin daughters and our 13 year old daughter own an internet radio station that's been in operation since 2004, previously owned by their older sisters that are now married.

They have a bank account with us as the co signers on the account. They also have a Paypal account that's in our names dba as the name of their radio station.They have a membership for their radio station based on membership donation.

Their mom and I control the finances of their business. For them to write a check one of us have to co sign the check. We've had no issues with them and with the profits they're making all of that is going into their college funds as a tax free investment.

The way we're handling things is teaching them they must take care of their money, run their business legally, cannot waste their money, accounting, banking and straight up business management.

If you're under the legal age to own a business then I would suggest you get some adult help and learn some smart business practices from them, or you may end up being an also ran and hiding from your clients.

Good luck on your business venture.

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Quote:

Hm, perhaps I phrased my OP wrong. I don't really want to register an official business, but I want to be able to accept maybe 50 transactions a month, and then be able to use that money.

Is there a way I could do this by myself?

There is no such legal thing as an "unofficial" business. I don't know about other states, but in California, a minor cannot enter in to any legal contract without parental/guardian consent/co-sign, etc. My advice? Focus on school, go to a good college, wait to run your business. There is PLENTY of time to do that after doing the things you should do when you're young, like getting a degree. Get it done and out of the way.
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@Danny247 - there are ways to do it but you will need the cooperation/assistance of a parent and/or guardian.

I tend to agree with the others though, I would wait until I was 18. Heck, when I was 10~12 I was dreaming of having my own servers colocated and starting my own hosting business... I know what it's like to want to do something and feeling that you can do it, but not legally being able to do it [at least, not easily].

I'm 26 going on 27 now, if that puts anything into perspective for you.

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Quote:

Our 16 year old twin daughters and our 13 year old daughter own an internet radio station.... Their mom and I control the finances of their business. For them to write a check one of us have to co sign the check. We've had no issues with them and with the profits they're making all of that is going into their college funds as a tax free investment.

I often come down hard on stupid teens and their stupid "businesses".

For once, somebody is doing things the right way.

Much respect, bruc.

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Join Date: Apr 2011

Location: Toronto, ON

Posts: 1,627

I think Bruc's is the best suggestion.

I don't know about now but I remember my mom opening my bank account in my name when I was 10 and I used that account until I was an adult.

I had all sorts of after school jobs and so forth from 14, cashing cheques, saving money, and being responsible. Do hard work, get paid, get what you want...although when I was 14 I didn't even know about BBS's yet, so times are a bit different. But I started investing into my prior business from 16 and turned it into a full time business when I was older.

Unless you (or your parents) have to something to hide, and since online businesses are a bit different and have the potential of all sorts of scams, going through your parents would be the best route. Look at it as 1 year training to get you on your own feet when you turn 18.

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Last edited by 48-14; Yesterday at 04:36 AM. Reason: typo

Newbie

Join Date: May 2010

Posts: 12

Quote:

I often come down hard on stupid teens and their stupid "businesses".

For once, somebody is doing things the right way.

Much respect, bruc.

I find this comment very offensive. I'm a young entrepreneur who also wants to better the internet by providing other young teens the ability to mark their territory on the internet with their own website. Not all parents are as understanding as "bruc" is, and that's not anything that I can control.

As for everyone else, your advice is great and I'm really going to listen to it. Can someone just outline the steps I'd need to take in order to be able to do this? Just in a brief way, like first I'd need to get a bank account and so on. I just want to be able to present this information to my parents in a way that shows them everything they'd be required to do.