What’s Next: What Do You Do After You Form A Business?
Congratulations! You have just registered with the state, making you the proud owner of a new business. The most challenging part must be over, right? Not quite. After you form a business, there is still a considerable amount of work left to be done.
Come Up With A Proper Name
Odds are business owners were required to come up with a business name that the state deemed distinguishable and unique. Additionally, the business owner may not have wanted to limit the scope of their operations when filing their business name.
For example, imagine a new business owner filed their business name as “Molly’s Restaurants.” However, the business owner has big dreams for her business and wishes to start many different restaurants. She can’t open six different restaurants at the same time, however. She must instead begin with one restaurant, “Two Scoops Ice Cream Shop.”
To operate under the “Two Scoops Ice Cream Shop” name, the business owner must file a DBA with the state. This informs the state that this specific business entity is operated by the LLC. Once the state approves the DBA, the business owner can begin putting the more-appropriate name on their signage, letterhead, and marketing materials.
Obtain A FEIN
A FEIN, or Federal Employer Identification Number, is a nine-digit number that the IRS gives to businesses. The IRS uses this number to identify companies operating in the United States. It will impact things such as payroll, bank accounts, and taxes. All businesses with employees are required to obtain a FEIN. Additionally, all businesses who have filed as a corporation or partnership are also expected to get a FEIN.
Business owners can complete the necessary paperwork on the IRS’ website or by completing physical forms and mailing them to the IRS. Business owners also have the option of applying for their FEIN by telephone. The process is considerably quicker, and almost instantaneous when done online or by phone.
Open A Business Bank Account
After obtaining a FEIN, business owners should open a bank account strictly for their business. This will help keep personal expenses separate from business expenses, which will make it much easier to file taxes down the road. Most banks will not accept business bank account applications unless the business owners can provide their FEIN and the articles proving they are a business.
Opening a business bank account will also likely grant you access to a business credit card. This is something of which you should take advantage. It will be much easier to make purchases on the company card, rather than having to reimburse yourself from the company’s bank account. A business credit card can also protect your personal line of credit were you ever to fall behind on payments or acquire debt.
Get In Touch With Your Registered Agent
Your registered agent will play an integral part in your company’s success. You’ve likely already contacted the agent at some point, since you may have needed to inform them that you planned to list them on the state filing forms. Hopefully, you have chosen a registered agent who you can trust.
When speaking with your registered agent, you should coordinate how they will pass along critical paperwork and notices. Some agents prefer to scan and email documents, while others prefer to hand-deliver documents in person. Whatever the method is, new business owners should coordinate with the registered agent after they form a business. If business owners end up missing essential documents because their registered agent failed to deliver them, they may be at risk of losing their company.
If the registered agent does not feel as though they can handle these requirements, there’s no need to worry. Most states make it easy for businesses to change their registered agent. They can do so by filing Change of Agent paperwork with the Secretary of State’s office. There may be a nominal filing fee associated with doing so, but it could be a cost that is well worth it. Ensure that your registered agent is up to the tasks forthcoming.
Apply For Licenses And Permits
Depending on what type of business an owner operates, they may need to acquire licenses or permits. For example, if a store owner wishes to sell alcohol, they will need to obtain special permits to do so. Before conducting business, new business owners should make sure that they do not need to acquire and licenses or permits. Business owners should ensure that their company remains in good standing on the federal, state, and local levels.
Purchase Insurance For The Business
New owners will likely also want to consider purchasing insurance after they form a business. Although some business structures, such as LLCs and corporations, protect the owner from liabilities and debts, they do not protect owners from losses. Owners may want to consider business insurance to protect their assets in case of a loss. Business owners typically have numerous insurance options that may be applicable, including:
- General Liability Insurance
- Professional Liability Insurance
- Product Liability Insurance
- Commercial Property Insurance
- Home-Based Business Insurance
- Worker’s Compensation Insurance
Begin Hiring Employees
Even if a business owner has employees in mind, they should not begin making official hires until they have formed the business. Once a new company starts hiring employees, they are obligated to verify the employees’ right to work and pay taxes. Business owners should also consider whether they would like to hire workers as independent contractors, part-time, or full-time employees.
Looking For Help?
Just because a new business owner has completed the process of forming a business does not mean that a third-party company like us can’t be beneficial. We can help ensure that a new business remains compliant with the state in which they’re conducting business.
Investing in a third-party company could be extremely beneficial for new business owners. Missteps can be incredibly costly, especially during the weeks and months when a company is being formed. The cost of hiring a third-party company for assistance pale in comparison to lost time and money that would come about because of delays.
Don’t Make Mistakes When Filing
If you are opening your first business, you’ll quickly discover that there are many steps that go into the process. Failing to complete these steps correctly could jeopardize your standing as a legitimate business. Thankfully, DoMyLLC is here to help. From registered agent services to filing services, we can help you through every step of the process when forming a business.