New Business Check List
Entrepreneurs founding their first business are likely overwhelmed by the amount of paperwork that’s required. It’s crucial that new business owners remain organized when starting their company. Otherwise, they’ll likely miss critical information that could delay the start-up process significantly. Although the process varies by state, below is a general new business checklist for those starting their first company.
Beginning Steps For New Businesses
Before entrepreneurs begin filing paperwork for their company, it’s crucial that they ensure they are ready to start doing so. Before registering a company, new business owners should have come up with a well-formulated business idea. They should come up with a mission statement and perhaps a document outlining their governing principles. Additionally, new businesses should have obtained enough money to fund their new startup. New businesses must ensure that they have enough capital on hand beforehand; otherwise, they risk taking on insurmountable debt early on in the process.
Choose A Legal Structure And Name
Once an entrepreneur is prepared to register a new business, they need to choose a legal structure for their company. New business owners must choose between one of four legal structures for their company:
Additionally, new business owners will then need to select a name for their entity. They will want to search the database of corporate names in the state in which they plan to file. New business owners must be careful to choose a name that has not yet been taken by another entity. Failure to do so will result in the state denying their registration forms, resulting in costly delays.
New business owners should choose a name that is unique and distinguishable. They should want the name to be representative of their company and vision without being too narrow in scope. New business owners should avoid things such as location in their business’ name, as this will limit the scope of their business and make it challenging to expand down the road.
Choose An Address And Registered Agent
Business owners should also know the address in which they plan to conduct business. Additionally, if the owner intends to structure the new business as an LLC, corporation, limited partnership, or limited liability partnership, they are required to have a registered agent on file with their respective state’s Secretary of State’s office.
The registered agent is an individual who accepts all legal documents and correspondence on behalf of the company. The agent is tasked with passing this information along to the business owners. Thus, new business owners should ensure that their registered agent is someone reliable and who they can trust. Once a new business has secured the information for their registered agent, they can move forward with filing the paperwork necessary to register as a new business.
Acquire A Federal Employer Identification Number
Those business owners who chose to register as an LLC, corporation, partnership, or sole proprietorship with employees are required, by federal law, to apply for a Federal Employer Identification Number. New business owners can do so by contacting the IRS. This number is crucial, as it is required to open bank accounts, process payroll, and file taxes.
Open A Bank Account
After securing the FEIN, the new business owner will need to open the company bank account. Owners must open an account that’s separate from their personal bank account. Owners should contact their bank before they open the account, as a bank’s requirements for a corporate account may vary. Reaching out to the bank beforehand will give entrepreneurs enough time to complete the required paperwork, helping to streamline the process.
Obtain Licenses and Permits
It’s also essential that business owners obtain any licenses and permits necessary to conduct business in a particular area. This could include federal, state, county, or local licenses and permits. This will depend heavily on the type of business being conduct. Most businesses do not require extensive licenses and permits, but new business owners will be better off confirming that they don’t need to acquire any before conducting business.
The two licenses and permits that new business owner should pay particular attention to are the business license and the state sales tax license. If a business sells a physical product, it will likely need to acquire a state sales tax license. Furthermore, practically all companies are required to obtain a business license from their local county, even if the business is operated out of the owner’s home.
Obtain Business Insurance
Depending on how a new business owner decided to incorporate their business, they may want to look into additional business insurance. Purchasing an insurance plan, such as General Business Insurance or a Business Owner’s Policy, could help protect the business owner and employees in case anything does not go as planned.
New business owners can quickly become overwhelmed with the requirements needed to start a company. Fortunately, DoMyLLC can help new business owners through every step of the process. We have extensive knowledge when it comes to state regulations and can help new business owners file the required paperwork, ensuring that they do not miss a single document or filing.
Entrepreneurs often have a gung-ho attitude. In many ways, this is important, as they would not be able to start their own business otherwise. But when it comes to the administrative duties involved with opening a new business, it could turn out to be detrimental. Entrepreneurs who think they know everything about a new business are often the ones who skip a vital step, resulting in significant delays.
Although it goes against their beliefs, hiring DoMyLLC to assist when starting a new business could be a worthwhile investment. Paying a small upfront cost could go a long way toward ensuring that a new business is operational as quickly as possible. The sooner a new business can begin operations, the sooner it can start making money. DoMyLLC can help make an entrepreneur’s dream become a reality.