Trying to start your own business? It’s an exciting venture, but it can be overwhelming. There are so many steps that need to be taken and the paperwork involved can seem daunting at first. That’s why, each month, we will be sharing our 25+ years of experience in business with our audience in our Pro Tips Articles. Our goal is to provide real-life support and advice to fellow entrepreneurs who are just starting out on their journey to building success stories. Your success is our success! Let’s get started by breaking down the five steps you should take when setting up a new business.
Table of Contents
Step 1: Choose a Business Structure
The first step in setting up your business is deciding which type of legal structure it will take. This decision will determine how you pay taxes and other important aspects of your business. There are four major types of legal structures for businesses: Sole Proprietorship, Partnership, Limited Liability Company (LLC), and Corporation (C Corp or S Corp). The one that best suits you depends on what kind of business you have, how many owners/members there are, and other factors specific to your situation. It’s important to understand which structure will help you best achieve your goals before making any decisions.
For small business owners, a single-member LLC or two-person partnership provides the optimal combination of financial security and flexibility. Establishing your legal structure from day one is essential – consult an attorney for advice to ensure it’s done right or explore online tools like LegalHoop that make setting up easy. Look out for our GSSG Business Pro Tip article doing an in-depth review on each type of legal structure so you can make the best-educated decision.
Step 2: Choose Your Business Name
Once you have decided on a legal structure for your business, the next step is choosing a name for your company. This may sound like fun (and it is!), but it’s also important because the name of your business will be associated with everything you do in the future. Make sure you do some research before settling on a name – make sure it hasn’t already been taken, check if the domain name is available, etc. Make sure it accurately reflects the mission and values of your company so that customers know what you stand for from the get-go. Also, remember that whatever name you choose will become part of your brand identity – so choose wisely!
Step 3: Register Your Logo & Trademark
After you find the right logo and name for your business you need to make sure your logo stays safe and is legally protected. The registration process is simple – read up on file requirements, prepare details for application submission, then either tackle it yourself online or hire a patent attorney to submit. If you’re short on time, there’s always professional online services like LegalHoop that can take care of the hard work on your behalf from start-to-finish. The process takes about 10-18 months to hear back on approval or denial status. Once approved, you will have to renew the process in 10 years. Don’t forget to maintain your trademark once approved so you remain legally protected long term.
Step 4: Get Federal Tax ID/EIN
Every business must obtain an Employer Identification Number (EIN) from the Internal Revenue Service (IRS). An EIN acts as the social security number for businesses – this unique nine-digit number identifies businesses for tax purposes and allows them to open bank accounts and apply for loans/credits/grants in their own name. Make sure you do this part after you find your perfect company name. It’s a bit of a drag if you must change your business name on the IRS site. Applying for an EIN is free and easy – all you have to do is go online at www.irs.gov/ein and fill out the form they provide!
Step 5: Get State Tax ID
The next step in setting up your legitimate business is getting a state tax ID number from the state where you plan on operating. A state tax ID number is required by many states when doing business within their borders and must be renewed annually or biennially depending on where you live.
Step 6: Apply for License and Permit
Once you have chosen a name and set up federal and state taxes IDs, it’s time to register for any licenses or permits that are required based on the type of product or service you provide in your state. This can include sales tax permits, liquor licenses, food handling permits, or health department certifications depending on what kind of business you are running – so make sure to research all applicable regulations before launching. No need to worry about the extra paperwork! Most states are open to home-based businesses, so you can get started in no time. All legal bases are covered – simply register and grab your business license before getting underway.
Setting up a legitimate business doesn’t have to be intimidating if you take things to step by step and understand what’s required for each stage of registration. It involves several steps but with knowledge comes power! Take your time researching each step before moving forward – this will save time and money in the long run because you won’t have to redo any mistakes made due to a lack of research or inadequate understanding of regulations or laws related to starting a new business venture. And don’t forget about us here at Global Synergy Sales Group, we are always here with helpful tips and advice whenever you need it! We look forward to hearing all about how successful your new venture has become thanks to our Business Pro Tips Articles! Tune in to our helpful “Business Pro Tips Articles” series launching every 15th of each month. We hope you’ll feel empowered and confident about starting off on the right foot when launching your new venture! Good luck!