One smart thing you're doing here, is researching before doing anything. With an online business I *highly* suggest you seek professional help in getting things set up for that first year, as well as for that first year's tax return. Especially if your state taxes personal income. One area that *MUST* be addressed with any online business, is that if you sell product to those in other states, you may have a legal liability to collect and pay any sales tax imposed by that state, to that state.
Things can get really complicated, really fast. So one-on-one face-to-face professional help for "at least" the first year of business will be the smartest move you can make. When dealing with a local tax pro, your four most spoken words needs to be "show me in writing".
