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Old 11-09-2008, 10:19 PM   #1
Patrick Donnelly
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Questions Regarding LLC's, Domain Names, Zoning, Certs, Insurance, Etc.

This is going to be a long post, with a good portion of rambling. However, it will follow a pretty logical progression, and what I'm looking for mostly is some general feedback on how well-planned things seem so far, in addition to answers to a few specific problems.

Actually, in typing this, I've found this post is so long, I've actually got to split it in two. It exceeds 10,000 words. So, really, don't read it unless you've got some time to kill.

So, things are working out well for me. They tend to do that frequently. I feel as if I work my *** off pretty frequently, so that may have something to do with it, or maybe I'm just exaggerating and am unusually lucky. Either way, I'm happy with it. This is the current state of things:

1. I am living at the U. of MD, in a dormitory, on-campus.
2. I am working in the U. of MD gym facilities as part of the floor staff, and now just finally beginning the process of progressing to personal training, after several weeks of delay on the part of the campus gym department. The pay for floor staff is $7.75 per hour; personal trainers are paid $11.75 per hour.
3. I am the president of the Weightlifting Club, which I inherited in pathetic condition. It was actually on probation for lack of activity and several other "offenses." Sadly, it seems as if it won't be permitted to continue on into next semester because it has so far been unable to make the 15 attendees per practice average, which is the minimum requirement set by the university. We were hitting 12-14 for a time, which was up from 5-8 in previous years, but have since dropped back in the 5-8 range.
4. I've signed up for the USAW Club Coach Certification, in order to meet another requirement levied upon the Weightlifting Club. Naturally, our attendance dropped from 12-14 to 5-8 the week after I signed up for this certification. The cause of the attendance drop is unknown. Of course, the certification was info I would want to get anyway, so I'm not really angry about it, and there is still a chance the club will pull through. I simply have a feeling that unless our club can hit 15+ members for at least three weeks or so, that the sports clubs department will not accept it. After all, getting 15 for the final meeting of the year, and calling that the "current average" would be easy, though preposterous.
5. I am also ACE-CPT and ACE-GFI certified, with a liability insurance policy for $1,000,000, which will last until June. I also have ARC-CPR/AED valid until next September.
6. I currently have one client whom I train outdoors in sort of a "boot camp" fashion, earning more than double what the U. of MD gyms will pay me as a personal trainer. Over the summer, I also trained people out of my home gym, which both they and I enjoyed.
7. I will be moving into off campus housing soon, where I will be renting a room in a large house which has an unused 2 car garage. The owner doesn't mind the presence of a makeshift gym in there (the renter before me had his set-up in the basement, where the ceilings are too low for me to go overhead without playing the "rafter doging" game), nor personal training, provided that I am insured.

So, yeah, things are falling together nicely. Here's the best-fit line of where I'm going, extrapolating from the above points:
- Drop the job at the U. of MD gyms. The working conditions are poor and there's little to no room for progression. Additionally, my interactions with the weightlifting club have put me in a negative light with the campus gym department directors.
- Create an LLC, named "Steadfast Fitness," for performing independent personal training, similar to what I did at home over the summer. I simply feel it's about time I go for something a bit more protective and official, even if it isn't absolutely perfect. I would limit my training to 1-2 clients at a time, or in some more rare cases, four (eg. two friends and their wives), as to not create a lot of hullabaloo, even though I would would be doing these things legitimately. Naturally, I would keep my ACE insurance in addition to the LLC.
- Use this LLC as the host of the "Steadfast Weightlifting Club," a USAW club, which I would have meet once weekly for free training, similar to what Tom Brose and Fred Fialco so nicely did for the members and friends of CrossFit DC. It seems that due to governmental regulations, and possibly because of equipment, this would be limited to five participants per weekend though, but that's fine. Since it would only be once a week, there would once again be no hullabaloo. USAW also provides insurance for its clubs' practices.
- Eventually develop this LLC into "CrossFit Steadfast," a College Park MD gym. By this time, some two years down the line, I would of course have to move out of the garage gym set-up, in part because of governmental regulations and in part because of simply wanting to expand.

How's it all sound so far?

The other benefits of this off-campus housing include:
1. Release from my current room and board agreement with U. of MD. The dining plan is horrendous, yet a requirement for those living on campus.
2. No fuss about trying to get housing for Sophomore, Junior, or Senior year.
3. The landowner gladly does long-term lease renewals.
4. I would be living with four other students, two graduate, and two undergraduate. I believe that moving in with some random family or elderly couple could just be weird.
5. Close proximity to U. of MD during the summer months, allowing me to further my education in physics/math by internships or classes. I love physics and will pursue it for a career, though fitness will remain my hobby (or lifestyle, really). The problem at this moment for me is that one can't just do physics in his spare time as a job or a hobby. Well, some kids do do physics for fun, but I'm not that nerdy. Given the complexity jump between high school and college level physics, I'm really not ready for any sort of deeply involved for any sort of year-round physics related job, even if such part time jobs existed. Summer internships would be a good opportunity to progress.
6. Part-time self employment, for 12-15 hours per week, which could potentially earn up to $25,000 per year, pre-taxes and expenses. Expenses past equipment would be minimal, which in itself would be minimal since I already own plenty, and I have the necessary certifications.
7. Possible qualification for in-state status (and tuition) by Spring 2010, which could result in some $35,000 of savings. The main requirement of the reclassification process is that you intend to permanently reside in Maryland for a purpose other than education. If I have an established, active, and profitable personal training LLC on its way to becoming a full-blown gym, I'm fairly certain that I meet that requirement. Being the coach of a USAW recognized weightlifting club would also be beneficial in this regard. Granted, this may also require that I file my taxes in Maryland, meaning that I would have to decipher the tax code mostly on my own (since the rest of my family resides in VA), but I've got to learn how to do that some day anyway. Auto insurance, health insurance, etc. are the same thing, assuming I get a car.

So, I seem to have things pretty straight, right? If you hadn't noticed, I have a severe tendency to plan things ahead to the greatest degree, and then work remarkably hard to make sure those plans succeed. It could be more practical to simply plan less and be more flexible, but it provides for less security and leaves too much up to chance. Additionally, planning out such things, even if they flop soon on, require that I do plenty of research into them, expanding my knowledge on many topics. I've done a lot of interesting research in the past few days.
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Old 11-09-2008, 10:23 PM   #2
Patrick Donnelly
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Re: Questions Regarding LLC's, Domain Names, Zoning, Certs, Insurance, Etc.

Now, onto specific topics and questions.

Does anyone here have specific experience with LLC's in the state of Maryland? I'm particular interested in hearing how the Personal Business Property Assessment and taxes work out, and what you do to clearly establish your LLC as an entity seperate from yourself. An operating agreement would be an easy example of something you could to there, but what's the typical format of those? Do you hold member meetings, even if you are your only member? Do you hold a separate checking account?

I'm liking the definition and connotations of the word "Steadfast," and also the repeating "s" and "f" sounds, which match up well with either "Fitness" and "CrossFit." It gives it a nice ring. Another affiliate owner suggested to me through email that I park on the domain name of "www.crossfitsteadfast.com," if I have any intent in using it eventually. Apparently, there are many www.crossfit*.com domain names in use, even without affiliates attached to them. Is that legal? I had thought that anything containing "CrossFit" in the URL would be a violation of trademark laws. So, should I grab that URL or not? Apparently, it only costs about $10 per year, which well worth it, assuming that there is a real concern of the URL being grabbed by someone else. If I should grab it, through whom should I do it?

According to the zoning laws of Prince George's County, there are two possibilities for the qualifications of my business. The first is a Health Club, which is "an establishment providing programs for controlled exercise, weight lifting, calisthenics, and general physical fitness or weight reduction." These are forbidden in residential areas, and also require a $300 yearly fee to be filed, in addition to the common paperwork of LLC's (which is by far greater in Maryland than it was in Virginia). So, that won't work. However, there is an interesting thing called the Home Occupation, whose definition is fits much better to the uses I would have.
Quote:
Any occupation or enterprise for gain or profit carried on in a dwelling unit and meeting the following criteria:
(A) It is customarily conducted entirely within a dwelling unit solely by the residents;
(B) It is incidental and secondary to the main residential use of the dwelling unit;
(C) It does not change the residential character or appearance of the dwelling or its primary residential use, nor does it have any exterior evidence, other than a permitted sign, to indicate that the dwelling is used for any but residential purposes;
(D) It has no on-premises storage of merchandise to be sold and used or equipment or materials to be used off the premises, unless storage is specifically permitted;
(E) Employment of nonresidents is prohibited unless specifically permitted as provided below;
(F) Off-street parking requirements in Part 11 do not apply to home occupations;
(G) Not more than two (2) vehicles associated with the home occupation or enterprise may be based at the subject property, nor parked on-site or off-site or on a public street within four hundred (400) yards from the property. Upon request by the Department of Environmental Resources, each dwelling unit resident shall provide for inspection the Motor Vehicle Administration registrations for all vehicles owned or leased by the resident, titled in the business name, or listed as business personal property on the resident’s or the business’ income or property tax returns;
(H) The following uses are permitted as a home occupation accessory to a dwelling, subject to restrictions in the definitions of those uses, and with additional restrictions as indicated:
(i) Instruction that involves a single instructor and not more than five (5) students at any one time;
... [more permitted uses]...
It's the single instructor and five students definition that causes it to suit me well. To be clear, the Home Occupation actually excludes elementary, high school, college, graduate, and professional education classes. In my case, I would be teaching deadlifts, squats, etc. to classes of less than five. A gym in an attached garage would hardly be "an establishment," as its use would be secondary to that of the dwelling uses of the home, and I wouldn't be "providing programs" either, as programs have a connotation of being much larger, open to the general public, and on a set schedule, such as aerobics programs in typical gyms. Upon opening a true CrossFit affiliate, this would change, and I would need to get alternative workspace. In some circumstances, parking may be an issue; I'm thinking with the weightlifitng club, but then they can park anywhere 400 yards away. There are only two cars owned by students in the home, and the driveway and street parking spaces are huge, easily accommodating another two cars. Would a personal training studio be more closely considered a teacher-student environment or a health club?

For the certifications, is there anything you would recommend in addition to ACE-CPT, ACE-GFI, and USAW-CC? Obviously, CF1 would be good, but I don't have the money to shell out at the moment, especially if I need to establish the LLC. Would you recommend going for CF1 as soon as possible, or to hold for it as long as possible? I've previously been of the line of thought that one should wait, and only get it once affiliating, as $1000 is no small change, and the movements taught are minimal (9 basic exercises which I know). However, many people have claimed it was the greatest experience of their lives (also making me a bit wary), and now that I am inching into position for affiliation, it is something I have to consider seriously. If you believe that it is worth getting immediately, please be very clear in explaining why you think so, as I am still learning towards my prior opinions. I will be sure to keep these current ones active, however annoying the ACE certifications may be, in order to keep some sort of professionalism and the insurance. I've heard a lot of razzmatazz about NSCA-CSCS, with it being either the best one to get, or the worst one, and I'd like to be able to found my own opinion on that one too. In particular, does anyone have a link to Rippetoe's reasons for dropping the certification? His comments are probably some of the most meaningful I'll be able to find on the topic. Granted, it's out of my possible consideration even until I have obtained a bachelor's degree.

As for insurance, would the typical liability insurance cover me for training groups of up to four? I would be writing down Steadfast Fitness, LLC., as an additional insured, and my waiver appears to be air tight. (If anyone would like to review the waiver, let me know, and I'll send it to you.) Fortunately, waivers seem to have some importance here in Maryland which was not present in Virginia. Yet, waivers and LLC's cannot always be relied upon. My insurance came from http://insureyourclub.com/ (Work/Family Safe) with the ACE discount. This statement on the website, "because most trainers and instructors are independent contractors, covering the individual is of the utmost importance so when they train clients in a club, a studio, or even a home…they know they have the coverage they need!" makes me believe I would be covered, but insurance companies are in the business of denying you claims. I have been unable to find anything regarding denial of claims for negligence, scope of practice, etc. and I am fairly certain that if someone were to fall and break an arm while doing kipping pull-ups, that the company would argue that I had to right to teach kipping pull-ups. They'd probably win that argument. In light of that, should I change insurance providers come June, and if so, to whom?


That's all I have for now. Thanks for reading.

Take care,
Patrick Donnelly
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Old 11-12-2008, 10:44 AM   #3
Amy Crawford
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Re: Questions Regarding LLC's, Domain Names, Zoning, Certs, Insurance, Etc.

Patrick,

You sure are a clear-thinking, planning young man. I don't have the answers to all of your questions, but I will throw out some thoughts.

*no experience with LLC in Maryland. Just starting to get going on it in Virginia.

*grabbing the URL sounds like a decent idea. I don't know about the trademark infringement information.

*can you call up PG county anonymously and ask about the residential use permit? I read over my town's permit, and it seemed OK, but when I called I got a NO! I would say that they type of operation you're planning on running fits the latter bill anyway.

*I highly recommend the CFL1 class. Yes, it's only 9 moves, moves which I knew previously too. But it really hones your skills, both your personal moves, and your instructional skills and eye. Also, being around like-minded individuals is great. I don't have any other big certifications, and I have insurance without any problem.

*moving off campus sounds great. Difficult to eat paleo/zone at a cafeteria.

Things look good to me. Having a plan and sticking with it, working hard to make it happen is a good plan. Rigidness to the point of breaking isn't. Be flexible when necessary, but stick to your plan.

Best of luck to you! It will be interesting to see what happens.
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Old 11-12-2008, 08:55 PM   #4
Patrick Donnelly
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Re: Questions Regarding LLC's, Domain Names, Zoning, Certs, Insurance, Etc.

Re: Amy
Thanks for the support.

What do you do to get around the zoning laws in Blacksburg? Also, have you ever tried sneaking in some personal training in the VA Tech gyms? They seem pretty strict about that sort of stuff here at UMD, so I don't really want to try it, especially considering that I am already pretty deeply involved with the gym department, and unlike a random stranger trainer, would have a lot of hell to deal with for it.

Re: Amy/General Readers
As for zoning, I am near certain I would qualify as a Home Occupation on the county level. I may place an anonymous call about this and double check, though I fear the zoning office may not completely understand the difference between an in-home personal training studio and a health club (eg. 24Hr Fitness). It may be better to feign ignorance (if I call and get a no-go) and plead forgiveness than to ask for permission. After all, I seem to f What sort of penalties do they even have? Simply stopping me from training? Slap me with some fees? If so, how much?

On the other hand, for the state level, I will have to register as a health club (see below). The wording of this, though, does imply that a trainer could provide a facility without actually being classified as a health club. This registration is to give consumers some insurance against paying for 3 months of fees in advance by contract, then having their trainer close the business on them without doing the work. It was explained to me that the state just doesn't care where you do it, as long as you don't rip people off. The county has it in reverse.
Quote:
http://www.oag.state.md.us/Healthclub/owners.htm (WFS)

WHO MUST REGISTER?
Businesses that sell health club services at a facility must register. Health club services include health clubs/gyms, weight loss centers, self defense schools, and personal trainers or athletic trainers who sell services and provide a facility.

I may be getting a car over this Thanksgiving break... If the deal is still running, I'd gladly go for a CrossFit-oriented license plate to get myself a free level 1 certification. Does anyone have any info on that? I've emailed HQ today, though as many of us know, it can take a while for a response from them... I can't see myself dropping a grand on it at this moment though.
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Old 11-13-2008, 12:17 AM   #5
Steve Ericson
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Re: Questions Regarding LLC's, Domain Names, Zoning, Certs, Insurance, Etc.

Hey Patrick. I don't have anything to add but encouragement. It sounds like you are are the right track with your goals, keep it up.

Quote:
Originally Posted by Patrick Donnelly View Post
If the deal is still running, I'd gladly go for a CrossFit-oriented license plate to get myself a free level 1 certification. Does anyone have any info on that? I've emailed HQ today, though as many of us know, it can take a while for a response from them... I can't see myself dropping a grand on it at this moment though.
Also, if you don't mind could you post what you find out about the license plate?

Thanks, Steve
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Old 11-13-2008, 08:58 AM   #6
Sean Dunston
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Re: Questions Regarding LLC's, Domain Names, Zoning, Certs, Insurance, Etc.

CF license plate deal has been over for about a month - maybe longer.
it was on the affiliate page a while ago when it ended.

Sorry about that.

But it shouldn't stop you from getting one anyway! As you probably know, Patrick, personalized plates in VA are only $15.

Edit - Check Affiliate Blog on October 2.
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Last edited by Sean Dunston : 11-13-2008 at 09:01 AM.
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Old 11-13-2008, 12:41 PM   #7
Peter Terry Haas
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Re: Questions Regarding LLC's, Domain Names, Zoning, Certs, Insurance, Etc.

Quote:
Originally Posted by Patrick Donnelly View Post
Does anyone here have specific experience with LLC's in the state of Maryland? I'm particular interested in hearing how the Personal Business Property Assessment and taxes work out, and what you do to clearly establish your LLC as an entity seperate from yourself. An operating agreement would be an easy example of something you could to there, but what's the typical format of those? Do you hold member meetings, even if you are your only member? Do you hold a separate checking account?
I used this book to set up our LLC (wfs amazon link). It includes state specific info and details on where to get the forms. To answer your question, I'll give you the sequence of how we set up our business stuff. It contains some stuff you didn't ask about, but it might help you out. (all links after this wfs)

1. LLC formation (state) - This link is the MD Corporate Charter Division. LLC forms and directions can be found here. You'll need to check to make sure the name isn't taken yet. I didn't look for it, but you might be able to find a search page somewhere on that website. You can also go to www.uspto.gov and search on the federal Trademark Register to see if anybody else in the country is using the name.
2. fictitious/assumed name (county) - ex: Steadfast Fitness dba (doing business as) Crossfit Steadfast. Can usually find the form on your county's register of deeds website. File and pay your fee.
3. business license (city) - forms available from whatever city you are in.
4. Employer ID number (EIN) (federal) - file online here. 20 minutes tops.
5. Bank account setup - take your state-approved LLC paperwork, EIN, and approved fictitious name paperwork to whatever bank you choose.

Once you get your LLC paperwork back from the state, you could probably do everything else same day if you went to all of the respective government offices in person.

No idea on the Personal Business Property Assessment. Talk to a tax professional. The book I mentioned covers basic taxation issues, various biz entity structures, as well as a sample operating agreement and how to fill it out. Get the book.

Good luck. Hope this helps.
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Old 11-13-2008, 03:35 PM   #8
Patrick Donnelly
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Re: Questions Regarding LLC's, Domain Names, Zoning, Certs, Insurance, Etc.

If you had the chance to buy 140kg of used York bumpers and a York 20kg Barbell, from people who really don't know what bumpers and Oly bars are, how much would you pay? They are about three years old, and have gotten a good amount of use. The 15, 20, and 25 kilo plates have colored duct tape on them, which is wearing off, faded, and ugly looking (as if I care). I'm thinking $350.

Quote:
Originally Posted by Sean Dunston View Post
CF license plate deal has been over for about a month - maybe longer.
Yeah, this was confirmed in an email today from CFHQ. Dammit. That would have been a very good opportunity to avoid $975 in expenses. The CF1 cert is going on the backburner for a little while now...

Re: Peter
Thanks for the info, especially the book. I've managed to find an eBook version on the publisher's site, and be ordering that shortly. If it takes 8 weeks to process the LLC documents, should I get on submitting that now, so I'm ready to go for early January? I'm afraid that I may have to file a 2008 Personal Business Property Assessment if I file for the LLC too early. I'm not sure when you're actually considered an LLC.
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Old 11-14-2008, 08:20 AM   #9
Sean Dunston
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Re: Questions Regarding LLC's, Domain Names, Zoning, Certs, Insurance, Etc.

Quote:
Originally Posted by Patrick Donnelly View Post
If it takes 8 weeks to process the LLC documents, should I get on submitting that now, so I'm ready to go for early January? I'm afraid that I may have to file a 2008 Personal Business Property Assessment if I file for the LLC too early. I'm not sure when you're actually considered an LLC.
Patrick-

I don't know what MD's rule is, but the rule in VA is when the SCC issues the certificate. That generally takes about a week to 10 days from the time you file your Articles of Organization.
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Old 11-14-2008, 03:17 PM   #10
Patrick Donnelly
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Re: Questions Regarding LLC's, Domain Names, Zoning, Certs, Insurance, Etc.

Re: Peter
I bought the eBook version of the book you suggested - good stuff.

Quote:
Originally Posted by Sean Dunston View Post
I don't know what MD's rule is, but the rule in VA is when the SCC issues the certificate. That generally takes about a week to 10 days from the time you file your Articles of Organization.
I found that it's the same in MD, only that the AoO take seven to eight weeks to file.
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