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• Introduction
• Idea Generation
• Market Research
• Marketing & Branding
• Financial Literacy
• Financial Literacy II
• The Pitch & Storytelling
• Business Planning
• Legal Considerations

Legal and compliance risks: Contract disputes, regulatory changes, tax compliance issues, copyright infringement (e.g., using an image online without proper licensing).

Cybersecurity risks: Data breaches, phishing attacks, ransomware (e.g., a hacker stealing customer credit card information).

Reputational risks: Negative reviews, public relations crises, ethical concerns (e.g., a bad review going viral on social media).

Intellectual property risks: Unauthorized use of copyrighted materials, trademark violations (e.g., another business using a similar name and logo, confusing your customers).

Assessing and prioritizing risks
Once risks are identified, they must be assessed based on:

• Likelihood: How probable is the risk?
• Impact: What are the consequences if it occurs?

Risk mitigation strategies. Businesses can manage risks through several approaches:

• Avoidance: Eliminating high risk activities (e.g., not entering uncertain or volatile markets)
• Reduction: Implementing preventive measures (e.g., cybersecurity protocols, requiring deposits from clients)
• Transfer: Using insurance or outsourcing to reduce direct exposure (e.g., hiring a payroll service to ensure tax compliance)
• Acceptance: Acknowledging and preparing for risks that cannot be eliminated (e.g., budgeting for potential slow sales months)

Small business owners often struggle to find time for risk management amid daily operations. Here are some time-efficient strategies:

The Role of Insurance in Risk Management: Insurance is a vital tool in mitigating financial losses from unforeseen events. Small businesses should consider different types of coverage, including:

• General Liability Insurance: Protects against lawsuits related to injuries or property damage (e.g., a customer slipping and falling in your store).
• Professional Liability Insurance: Covers claims of negligence or malpractice (e.g., a marketing consultant being sued for not delivering promised results).
• Product Liability Insurance: Protects businesses that manufacture or sell goods (e.g., a bakery facing a lawsuit over an allergic reaction).
• Cybersecurity Insurance: Covers damages related to data breaches and cyber threats (e.g., customer credit card information being hacked).

Business insurance:  Business insurance protects you from the unexpected costs of running a business. Accidents, natural disasters, and lawsuits could run you out of business. Protect yourself with the right insurance.

• Pick the type of business insurance you need
• Six common types of business insurance
• Four steps to buy business insurance

Pick the type of business insurance you need. You get some protections from the kind of business structure you choose.  A limited liability company (LLC) or a corporation status can protect your personal property from lawsuits. However, that protection has limits.

Unexpected catastrophe? Business insurance can fill in any gaps in coverage. This will make sure both your personal and business assets are fully protected. You also may be legally required to purchase certain types of business insurance.

The federal government requires every business with employees to have the following:

• Worker compensation
• Unemployment
• Disability insurance

Four steps to buy business insurance

• Assess your risks.Think about what kind of accidents, natural disasters, or lawsuits could damage your business. Is your business located in a commercial area that is at risk from seasonal events? Commercial property insurance will help protect against loss.
• Find a reputable licensed agent.Commercial insurance agents can help you find policies that match your business needs. They receive commissions from insurance companies when they sell policies, so it’s important to find a licensed agent that’s interested in your needs as much as his or her own.
• Shop around.Prices and benefits can vary significantly. You should compare rates, terms, and benefits for insurance offers from several different agents.
• Re-assess every year. As your business grows, so do your liabilities. If you have purchased or replaced equipment or expanded operations, contact your insurance agent. You should discuss any changes in your business and how they affect your coverage.

Consulting with an attorney

• Legal counsel is essential for navigating risk management effectively. It is often cheaper to lose a potential client than to face a costly lawsuit. Businesses should:
• Consult with attorneys when drafting contracts.
• Ensure compliance with industry regulations.
• Establish strong liability agreements to protect against legal claims.
• Seek guidance on intellectual property protection to prevent copyright and trademark infringement claims.

Policies and procedures every business should have

Having clear internal policies and procedures is crucial for mitigating risks and ensuring smooth operations. Small businesses should consider implementing:

• Privacy Policy: Outlines how customer data is collected, stored, and protected
• Human Resources (HR) Policies: Covers hiring, workplace behavior, employee rights, and termination procedures
• Operational Procedures: Standardized processes for daily business functions
• Crisis Management Plan: Steps to handle emergencies, including PR and legal responses

Conclusion

Risk management is an ongoing process that requires vigilance and adaptation. By identifying, assessing, and mitigating risks, small business owners can safeguard their operations, financial health, and long-term success.

Goal: Create a mindful approach to financial well-being, integrating personal finance, mental well-being, ethical financial decision-making, and long-term sustainability.

Topics:

• Financial mindfulness and mental health
• Regenerative investing and ethical finance
• Long-term financial well-being
• Community wealth-building

Financial mindfulness and mental health

• Exploring the connection between financial stress and mental well-being.
• Techniques for financial mindfulness and stress reduction.
• Learning Outcome: Entrepreneurs will develop strategies to manage financial stress and cultivate a healthy relationship with money.
• Activity: Creating a mindful budget

What do you need to feel your best and how much does each need cost? Example of needs:

• Food and water
• Housing
• Clothes
• Naturopath
• Gym and/or yoga membership

Regenerative investing and ethical finance

Introduction: Degenerative, sustainable, and regenerative investments

Understanding ethical banking and impact investing

Learning outcome: Entrepreneurs will evaluate investment options based on ethical and regenerative factors.

Types of investments: Degenerative, Sustainable, and Regenerative

Degenerative investments: Investments that deplete natural resources and contribute to environmental and social harm. Example: Oil drilling and mining companies that extract resources without replenishment, leading to deforestation, pollution, and climate change.

Sustainable investments: Investments that maintain ecological balance, social well-being, and long-term economic growth without depleting resources.

Example: Renewable energy companies such as solar and wind energy firms that reduce reliance on fossil fuels and lower carbon emissions.

Regenerative investments: Investments that actively restore and enhance natural and social systems, creating long-term benefits. Example: Agroforestry projects that plant fruit trees (such as apple trees) to regenerate soil, improve biodiversity, and provide local economic opportunities.

Activity: Research an ethical investment opportunity for your business.

Long-term financial well-being and community wealth-building

• Importance of long-term financial planning and generational wealth.
• Exploring cooperative economics and community wealth-building initiatives.
• Learning Outcome: Entrepreneurs will identify long-term financial strategies that benefit both individuals and communities.

Activity: Create a community wealth-building proposal based on local needs.

Other resources you might find useful:

• Mindful Economics: This episode is from the podcast ”The Way out is In” which offers a perspective of mindfulness on day-to-day topics
• Wealthfront: Offers a software-based financial advice engine that delivers automated financial planning tools to help users achieve better outcomes.
• Intuit Credit Karma: Offers a way to stay on top of your finances and manage your money – everything from monitoring and building credit to filing taxes, borrowing money and optimizing how you spend and save.
• Circular Economy
• Doughnut Economics Action Lab
• What Doughnut Economics means for business
• Doughnut Design for Business
• Etsy Budget Google Sheets: Budget templates that map into Google sheets.
• WA State Treasurer: offers financial education and updates on upcoming workshops and additional state resources.
• Hopelink: Financial coaching
• Sound Outreach: Financial coaching
• US Chamber of Commerce: Federal resource for grants focused on small businesses.
• gov: Federal resource for grants focused on small businesses.
• Nerdwallet: Resource for finding grants.
• Legal Zoom: Resource for finding grants.

We have to pay tax on all income unless specifically excluded by the government. Wages, dividends, self-employment, and even unemployment are examples of taxable income. The government allows us to reduce our tax bill through deductions when the money is spent on certain things deemed important to society such as :

• College
• Home ownership
• Certain family obligations

After deductions, we are assessed a tax bill on our income.

Our employer withholds tax on our behalf, or we make estimated payments when self-employed. If we pay too much, we get a refund when we do our tax return. If we underpaid, we will owe money when we file our return. It is ideal to neither owe nor receive a return. A tax return can seem like money back – but that’s also money you might have invested earlier into your business, into a savings account that earns dividends (bonus income!).  Taxes become a bit more complicated when it comes to self-employment.

So what is self-employment when it comes to taxes? You’re typically considered self-employed if you fall into any of the following categories:

• You carry on a trade or business as a sole proprietor or an independent contractor
• You are a member of a partnership that carries on a trade or business
• You are otherwise in business for yourself (including a part-time business)

Since partnerships on often have complicated enough tax and legal obligations that hiring a CPA or Attorney is best practice, the rest will focus on Sole Proprietorships and LLC’s. What tax forms will I need depending on my business structure?

• Sole-proprietor or single-member LLC: Files Schedule C with Individual Tax Return (Form 1040).
• Partnership or multi-member LLC: Files Partnership Return (Form 1065) and K-1 with Individual Tax Return (Form 1040).
• S-Corporation: Files S-Corp Return (Form 1120s) and K-1 with Individual Tax Return (Form 1040).
• C-Corporation: Files C-Corp Return (Form 1120) and possible 1099-B with Individual Tax Return.

What’s not self-employment income?

• Wages earned as an employee and reported on a W-2
• Lottery or gambling winnings (unless you are in the business of gambling)
• Gifts
• Inheritance
• Investment income (unless you are in the business of investing)

Do I pay myself? Short answer: No, you don’t

• You are the business, so you keep the profits
• The IRS doesn’t care if the funds are still in a business bank account or in a personal account
• You do not get a W2 or other tax form
• Remember- this is only for sole-proprietorships and SMLLC’s

Main differences between self-employment and employed taxes

• You will pay Self-Employment tax
• If you are Self-Employed, you may take different deductions than other taxpayers do
• You may need to make estimated tax payments every quarter/ four times a year

In Washington, businesses generally pay:

• Federal Income Tax
• Self-Employment Tax (part of Federal)
• Washington State Business & Operations Tax
• A business doesn’t pay sales tax on what’s sold, but it is responsible for collecting and remitting it

Deductions are the way we subtract the money you invested into your business to ensure all the money you earned and are reporting as income is adjusted for the costs that went along with earning that money.

Common deductions include:

• Advertising
• Commissions and Fees
• Contract Labor
• Insurance
• Professional Dues and Software Subscriptions
• Legal and Professional Services
• Office Expense
• Rent or Lease
• Repairs and Maintenance
• Supplies
• Wages
• Taxes and Licenses
• Meals
• Utilities
• Education/ Research

Slightly more confusing deductions that have some specific requirements: A home office must meet exclusive and regular use test. Can’t be your kitchen table or your bedroom. Who qualifies for the home office deduction? Small business owners and independent contractors with a home business can use the home office deduction to write expenses off of their small business taxes. Here are the key items to keep in mind if you’re considering using the home office deduction:

• IRS home office rules dictate that the home must be the principal place of business. You can do business elsewhere, but most of it must be done at home.
• When deducting home office expenses, you can use the portion of your house only that is used for the business and, this can’t be stressed enough, you can’t use that area for anything else. The best strategy is to set aside a room to use as an office and keep the door closed when you’re not working. If you have kids, put a sign on the door that says, “Monsters: Keep out!”

Simplified method

• The simplified method is just that, simple. Calculate the total square footage that you use for business, up to a maximum of 300 square feet, and multiply that by $5.
• The best way to determine how many square feet you use is to dig out the appraisal that the bank ordered when you bought your house or when you rented your apartment. It should have a breakout of the total square footage of the house and the size of each room. We’ll use the total square footage for the next method.

Regular method

• To use the regular method, calculate the total eligible expenses for your house and then determine the portion of those that are used for the business. If you have a 2,000-square-foot house and use a 400-square-foot room for the business, you would take (400 ÷ 2,000) 20% of the deductible expenses.
• Use IRS form 8829 to calculate the total deductible expenses for your home office tax. This form should be available and easy to figure out on your tax software.

Deductions can also include a percentage of your:

• Mortgage interest or rent
• Insurance
• Property Taxes
• Utilities
• Repairs

Travel is another tricky one and changes with almost every tax revision. It includes:

• Flights
• Lodging
• Transportation
• Fees
• Meals

Auto and miles

Can take either a standard mileage allowance OR a percentage of actual expenses Mileage allowance for 2025 is: $0.70. You can use this link to see the most up-to-date information from the IRS. Mileage does not include parking- that is a separate deduction write-off. Business percentage is applied to each of these items. You must keep a mileage log no matter which method you use. Track from your first business stop of the day to the last business stop of the day Everything else is commuting/ personal!

An example. Actual expenses can include:

• Insurance
• Gas
• Interest on payments
• Repairs and Maintenance
• Parking
• Meals, including in-town meals

A note on in-town meals:

• Must be with another person for the purpose of discussing business
• Must be in a quiet location
• Deduction is limited to 50% of expense travel meals:
• May be alone
• May take per-diem instead of actual

How does depreciation work?

In the Real World we think of depreciation as something losing value. This is not true in Tax Land! Depreciation is system to help recover costs. We want to match the cost of the item to the time in which the item will be used. We generally depreciate something that costs more than $300 and will be used more than 1 year. Do I have to depreciate? Yes and No!

Somethings DO have to be depreciated.

• Real property used in business such as home office and rental Somethings can be expensed rather than depreciated (Section 179/Bonus)
• This is beneficial in a year in which you have a high tax liability
• You can choose to depreciate or expense!

Estimated payment

Our tax system is designed to be “pay as you go”. Employees have taxes withheld from each paycheck to cover liability Self-Employed individuals should make quarterly payments or you will incur penalty if payments are not paid each quarter. Use this website to create an account to pay estimated taxes each quarter.  If your business varies each month, you may need to run reports to determine what you should pay. Record keeping is essential! Knowing how your business is performing you can make better decisions. You can use many different methods:

• Bookkeeper
• Spreadsheet
• Software such as Quickbooks, Freshbooks,Wave

You can also use online tax filing resources, such as Turbo Tax or H&R Block to help with filing taxes. Please note that while you can pretty nearly always file your personal, federal taxes for free and Washington doesn’t have a state tax, you will almost always have to pay to use these Tax Resources to help you complete the required self-employment/small business forms. Typically, fees are $100 or less. You might try yourself to fill out tax documents (which is not recommended unless you have a family member or a friend of a friend who’s an accountant to help you review!)

Here’s the full list of documents you’ll likely need to complete all self-employed and small business taxes. You may not need or use all of these documents.

Federal Forms

• LLC – Form 1040
• Sole Prop – Form 1040
• C-Corp – Form 1120
• S-Corp – Form 1120-S
• Partnerships – Form 1065 (provide partners with Schedule K-1)

Needed Documents

• Personal tax documents
• 1099ʼs from all sources
• Profits/sales
• Business expenses
• Professional/legal fees
• Estimated taxes paid

Profit

• Records of gross receipts
• Documents showing refunds/returns
• Interest or Investment income from investments owned by business

Expenses

• Overhead expenses
• Supplies vs. equipment
• Home office deduction
• Health insurance (if provided)
• Transportation
• Meals and entertainment