If you’re looking to start an online business, you need to register it. However, the process will vary depending on the type of business you’re beginning and the state you live in.
The first step is deciding on your business structure. This will determine your tax filings, personal liability protection, and day-to-day operations. It also influences registering your name and obtaining required licenses and permits.
Choosing a business structure
The business structure you choose is vital to your company’s success. It determines how much personal liability you face and how easy or difficult it is to raise outside funds. It also affects how your business is taxed. Limited liability companies (LLCs), corporations, partnerships, and sole proprietorships are the four primary forms of company structures. Everyone has benefits and drawbacks. It’s essential to think about your company goals and objectives and the level of risk you are willing to take when deciding which structure to use.
Once a business structure is chosen, the next step is registering a business. This process involves completing government reports and paperwork. It is also necessary for obtaining licenses and permits. Opening a bank account specifically for your business is a good idea. This will help keep your personal and business assets, and funds separate from each other.
Once you’ve registered your business, it’s time to apply for an Employer Identification Number (EIN). This unique nine-digit number is similar to a social security number and helps establish your company as a legal entity. It’s also helpful in establishing business credit and determining the appropriate taxes to file. In addition, some businesses may require additional documentation or filings with the state or franchise tax board after registering.
Choosing a business name
Choosing a business name is one of the most important decisions a new business owner will make. It is an essential part of the registration process and will also serve as the company’s first impression with potential customers. Choose a business name that conveys your vision and brand identity. It should also be easy to remember and spell. Avoid words that may be confused with governmental entities or inappropriate for your business.
Changing your business name can be expensive and time-consuming. You must notify the IRS, apply for a new employer identification number, and change licenses and permits. Run a state-level search before you choose a name to ensure it is unique and available. In addition, you should also check at the federal level to see if it has been trademarked.
Many states require that a formal business structure have a different name than a sole proprietorship, so choosing a name that reflects the type of business you create is best. Some companies may use the owner’s legal name in official documents but will operate under a separate trading name for marketing purposes. These names are often known as DBAs (doing business as). These DBAs must follow the same rules and guidelines as a regular corporate name.
Choosing a registered agent
As a business owner, you must designate a registered agent for your company. A registered agent is a person or organization that accepts official notices, court documents, and processes serving on behalf of your business. This person must have a physical address in the registration state that is different from your business address. In addition, they must be available during regular business hours to receive documents and mail. A registered agent is not required by law in every state, but it is a good idea for any small or medium-sized business to have one.
You may designate a coworker, relative, friend, or another individual within your company to act as your registered agent or as the agent yourself. However, this has several drawbacks, including that your name and address become part of the public record. It also means that someone who sues your business can easily find you.
Many online legal services offer registered agent services for a fee. Choosing an experienced professional registered agent is the best choice for your business. These companies will be able to provide you with a physical address in each state and will be available during regular business hours. They will also be able to notify you of necessary paperwork and deadlines promptly.
Obtaining a business license
Getting the proper business licenses is one of the most important tasks when starting a small company. Although it’s not always a fun part of starting a business, it’s an essential step to help avoid legal issues. Different states and cities have additional licensing requirements, so it’s crucial to determine what your local area requires before launching your business.
You’ll also need to decide what business structure you want to operate, such as a sole proprietorship, limited liability company (LLC), or a corporation. Then, you’ll need to compile the proper business documents for the licensing process. Once you have your licenses, you can start attracting customers and growing your business.
It’s best to obtain your licenses as soon as possible so you can be ready to open your doors for business. You should also display your business licenses in your store or website and keep track of any renewal dates to ensure you’re operating legally.
Many industries require specific licenses, such as a permit to sell alcohol or firearms. Other businesses may need a state or city license or additional permits to sell specialized products. While it can be challenging to determine which licenses you need, you can start by visiting the local government’s website and checking its requirements.