10 Steps to Start Any Business
Startup Legal can provide assistance through each of the following steps:
Form a business entity, such as a Corporation, LLC or Limited Partnership (see “Why form an Entity”). Doing business as a separate legal entity can give you a variety of legal and tax benefits, including protection from personal liability for the debts and obligations of your business.
Determine if there are any specialized licenses you will need to open your business. For example, certain professions or home-based businesses must file with their city or county before doing business.
Determine if your business requires you to file with any particular regulatory body. For example, lawyers who want to start law firms must register their firm with the State Bar.
File for a tax identification number with the IRS. This will allow your business to open a bank account and hire employees if necessary.
Open a bank account in your company’s name. Separating your personal and business finances will allow your company to take tax deductions for many additional expenses.
Develop a system for accepting payments. If you will be running a retail or service business, you may want to open a merchant account so that customers can pay with credit cards. Or you may want to use other credit card processing alternatives to decrease your initial overhead.
If you are a real estate or investment company you may want to open an escrow account.
File the mandatory Statement of Information with the state, updating the state on the status of your company. This puts the state on notice of any relevant changes in your business since the initial filing.
File for tax status of your entity. You will want to decide upon the most advantageous strategy for taking profits out of your company or reinvesting into your company.
Set up a system to follow future corporate formalities. Certain business entities require annual board meetings and/or mailed reports to all owners. While an entity may have only one owner in some circumstances, certain formalities must still be followed.
Keep good records. In the future, your business will need to file tax returns with the IRS, as well as annual reports with the state regarding relevant changes to your business. Setting up a simple record-keeping system in the beginning can save significant time in the long run.