We assist with the following steps:
1. Ascertain the legal configuration of your business:
You need to organize your business as a legal entity. There are numerous options to account for, and all have various legal, financial and tax considerations. The right legal configuration for your business depends on a number of things. These include the level of control you want to have, your business’ vulnerability to lawsuits and financing needs. The legal structure chosen by you will determine additional registration requirements. You may have to file registration forms with your state and/or local government, after you have chosen a legal structure. The various considerations which need to be taken into account change from state to state. Some firms / businesses need to be registered with your state government:
A nonprofit organization
A limited-liability company or partnership
You won’t need to register your business at the state level, if you set up your business as a sole proprietorship (also known as sole trader – a business entity owned and run by one individual). For many states, it is necessary that sole proprietors use their own name for the company / business name unless they formally register another name. This is referred to as your Doing Business As (DBA) name, trade name or a fictitious name.
Your first choice of a business type is not permanent. You can initially register as a sole proprietorship, and if your business expands and your personal liability risk goes up, you can change your business to an LLC.
2. Register your business / firm name:
“Doing Business As,” “DBA,” “Assumed Name,” and “Fictitious Name” are references that are used when describing the procedure of registering a legal name for your business.
The legal name of a firm / business by default is the name of the person or organization that owns a business. The legal name will be your full name, if you are the exclusive proprietor of your firm / business. However, if your business is a partnership, the legal name is the name outlined in your partnership agreement / the last names of the partners. The business’ legal name is the one that was registered with the state government, for limited liability corporations (LLCs) and corporations.
Your business’ legal name is a prerequisite on all government documents. Forms include your application form for employer tax identifications, licenses and permits. If you decide to set up a shop or sell your products under a separate name, then you might need to file an “assumed name” registration form with your state and local government.
The legal name of firm / business is the name of the owner/s. For example:
The legal name is your full name, if you are the sole proprietor of your business
The legal name is the name provided in your partnership confirmation or the last names of the partners, if your business is a partnership
The business’ legal name is the one that was given to the state government, for limited liability corporations (LLCs) and corporations
Your legal business name is needed on all government documents, such as your application for employer tax IDs, licenses and permits. You may have to file a “fictitious name” on registration forms with your government agency, if you wish to set up a shop or sell your products under a different name.
An assumed name (or fictitious name, trade name or DBA (doing business as) name is a business name that is not the same as your personal name, the names of your partners or the formally registered name of your LLC or company.
For example, if Tom Johnson the sole owner of a catering company he runs from his home, and he wants to change his business name to Seaside Catering instead of using his business’ legal name, which is Tom Johnson. Tom will need to register the new name as a fictitious business name (DBA ) with a government agency, in order to start using that name. The relevant government agency to register with depends on where she lives. You have to register fictitious names with the relevant state government or with the county clerk’s office in some states, but there are also some states that you do not have to register the fictitious business names.
3. Acquire your federal tax ID:
Employers with employees, business partnerships and corporations, and other categories of organizations, are required to acquire an Employer Identification Number (EIN) from the U.S. Internal Revenue Service. This number is also known as an Employer Tax ID and Form SS-4:
U.S. Internal Revenue Service
An Employer Identification Number (EIN) / Federal Tax Identification Number is needed to distinguish a business entity. Companies / businesses normally need an EIN. There are a number of ways in which you can put through an application for an EIN, including applying online. This service is free. It is offered by the Internal Revenue Service. You are required to check with your state to see if you need a state number / charter.
4. Register with your state revenue agency:
In addition, you are required to obtain Tax IDs and permits from your state’s revenue agency, just as you are required to have a Federal Tax ID.
If you decide to sell products and you need to compile sales taxes, you will probably be required to acquire a Sales Tax Permit or Vendor’s License. This can be obtained from your state or local government (or both).
As well as business taxes which are needed by the federal government, you will need to pay some state and local taxes, with every state and locality having its own tax laws. The following links allow access to essential resources. These resources will help you learn about your state tax requirements. By acquiring knowledge of your state tax requirement, this can help you avoid problems and also help your business save money. The most frequent types of tax obligations for small businesses / firms include the following:
In the majority of states, business / company owners need to register their business with a state tax agency and apply for the relevant tax permits. It is a requirement in most states require for businesses to apply for a state sales tax permit, in order to collect sales tax from customers.
Almost all states place a levy on business or corporate income tax. Your tax obligation is dependent on the legal configuration of your business. The LLC gets taxed independently from the owners, if your business is a Limited Liability Company (LLC), while sole owners report their personal & business income taxes using the same form. For specific requirements, contact the General Tax Information link under your state.
Business owners with employees are also accountable for paying the appropriate taxes required by the state, as well as federal employment taxes. Payment of state workers’ compensation insurance and unemployment insurance taxes is required by all states.
Additionally, the states / territories listed below require a business to pay for temporary disability insurance:
5. Acquire licenses and permits:
The majority of businesses need to acquire some category of business license or permit to formally operate. Most small businesses are required to acquire a general business license / industry-specific operating permits from state and local government agencies. You may be required to be licensed at the federal, state and/or local level, depending on your business. As well as a basic operating license, you might need specific permits, including an environmental permit.
It’s vitally important to understand the licensing rules where your business is based, as regulations change by industry, state and locality. Not adhering to the regulations for licensing and permitting can result in costly fines, as well as placing your business / company at serious risk. You might be required to acquire a federal license, if your business is taking part in activities that are supervised and controlled by a federal agency.