Small businesses are considered one of the strengths of the American economy and the government encourages the citizens to develop an entrepreneurial spirit.
Registering small businesses is quite straightforward. These are the requirements you have to meet before opening a small business.
Create A Business Structure
The first step in registering a small business in America is to first choose your business structure. There are different types of companies ranging from a sole proprietorship, business name, limited liability company, unlimited liability company, etc.
For small businesses, the structure is usually between a sole proprietorship or a business name. Your business structure will determine the extent of the business you can conduct and the way you will be taxed.
You can get more information on the structure of small businesses from the website of The U.S. Small Business Administration (SBA).
Choose And Register Your Business Name
After choosing a business structure, the next step is to choose a unique business name. The business name must not have been previously registered or trademarked.
After choosing a unique business name that’s free in your state, you should also consider trademarking the name under federal law. This will protect your business name and logos across all 50 states.
When it comes to registering small businesses some of the best review sites can help to learn from others and avoid repeating costly mistakes.
Get An EIN
The Employer Identification Number is like a Social Security Number for companies. This is a legal requirement for every corporation and Limited Liability Company in New Jersey. While DBAa isn’t mandated to obtain EIN, it’s recommended to prevent the use of personal SSN on business, legal, and tax documents.
You can easily apply for an Employer Identification Number (EIN) from the IRS website where you will be asked to enter the necessary information.
Open A Business Bank Account
You’re required to open a business bank account for your small business. The bank account will make it easier to separate your finances from your business finances.
A business account will also make it easier for the IRS to audit your business and determine your taxes.
Obtain Required Business Permits and Licenses
Before operating a small business, you’re required to obtain the necessary business permits from the county and the state.
Small businesses are regulated by state laws so you have to obtain a state license that permits you to operate.
Prepare to Pay State and Local Taxes
You have to research the tax requirements you are obligated to pay as a small business. Aside from income tax, there are some taxes you’re required to pay.
A tax expert can assist you to file your tax papers and outlining tax obligations.
Create a Compliance Plan
Small businesses are subjected to some standard business compliance laws and regulations such as intellectual property, competition laws, marketing, advertising, etc.
Observing compliance laws and regulations is part of good financial habits. A lawyer can help you understand the laws that apply to small businesses.
Get Business Insurance
Before you can register a small business in the United States you have to have in place business insurance that covers your employees and some of the risks attached to your business.
The nature of the insurance will depend on the industry your small business falls under. The types of small business insurance include general liability insurance, errors and omissions insurance, home-based business insurance.
An insurance expert can help you understand the insurance plan that best suits your small business.