You are about to read the steps to start a business so that you can guide yourself through each of them to start your company, so that the complications of any business opening do not affect you.
In this way you can dedicate yourself to planning your company in order and achieving the success you expect.
First steps to start a business
Establish the type of company: As the first of the steps to start a business You should think calmly and choose the type of company that you will establish because the licenses and permits that you must request will depend on it and even this decision may also affect your financial peace of mind.
So think about whether you establish a business as a corporation, as a partnership, as a sole proprietor, or as an LCC or limited liability company.
The location of the company:
Plan where the company will be located, that is, you will decide the physical place where the business will be established, because you will need to apply for the zoning permit.
Well, as you have also thought about what your company will do, either to offer services or to sell products, this activity must be approved in the area you have chosen.
At the same time, you will also need to think about whether you will need to hire staff, since everything will depend on the size of the company that you agree to, since it will also have to do with the size of the building that you rent, build or buy.
Business plan with the steps to create a company
After having followed the steps to start a business Check them above and check that everything is in order. You have already determined what your company will sell or offer, you have also determined the physical location of your company, therefore you know exactly if your budget meets the needs of covering all expenses or will need financing to carry out your project.
In fact, having determined all the above questions, you will also know if you need to manage the application for special licenses in addition to having your visa and work permit.
If your budget does not cover all expenses, you can access tax incentives as an option that is available to help you reduce the tax burden.
In this planning stage you will think about the name of the company that you will form, since if you do not choose your own name and instead decide on a fictitious name you will have to register it whether you establish a corporation or a limited liability company.
In turn, you should think about how you will capitalize your company, for example defining the number of shares and contributing shareholders with contributed capital in the company.
In this same sense, you will establish who will be the shareholders, the directors of the company, the functions of each official and their responsibilities.
The legal procedure that corresponds to the registration of your company name will have already been done, but there are still other procedures that you must carry out, such as the organization of the company from a meeting to appoint the officers and directors.
At this same meeting, you will issue the shares that correspond to the shareholders.
Then you must request the federal identification number, because when you establish a company you must do it legally, for which you must consider certain fiscal, financial and of course legal issues.
As for the legal, you can configure your business according to the different levels of control that it will have, such as exposure to lawsuits and the financing you require.
In fact, the legal structure you choose will determine the extra registration requirements such as registration forms with the state or with the local government.
If you establish your business as sole proprietorship, you will not need to register it at the state level, because many states will require you to use your own name as the business name.
However, due to market fluctuation and the possibility of expansion of your company, you could have started it as a sole proprietorship and then expand it and as the risk of personal liability will increase, you will be able to change your company to a limited liability company or LCC.
DBA is the fictitious name of your company, through which you will do business using that name.
But the legal name of your company is a general requirement as part of the documentation required by the government. To do this, you must fill out the application form for employer tax identification in addition to licenses and permits.
But if you are the sole owner, your full proper name is considered as a legal name.
If you formed a company, the legal name will be the one provided in the confirmation of the association or the last names of the partners.
In case you have established a corporation or limited liability company, the legal name is the one you confirmed to the state government.
The trade name:
The legal commercial name is the one you need to be included in all the documents such as the application for the employer’s tax identification number, permits and licenses,
However, you may also need to present a fictitious name when filling out the registration forms with the government agency when you establish a business with a name other than your own name.
It is the commercial, fictitious or DBA name with which you will do business, which is not your own name, neither your partners nor the one that you registered your LCC.
EIN is the tax identification number that corporations, trade associations and all employers are required to purchase from the United States Internal Revenue Service from form SS-4.
Keep in mind that the EIN application can be managed online thanks to the free service offered by the internal tax service, but remember to check with the state government if it is an essential requirement for your company.
Federal Tax ID:
In addition to needing to obtain a tax identification number and permits from the state revenue agency, you are required to obtain a federal tax ID.
If you decide to sell products you need the sales tax and therefore it is very likely that you will need to obtain a sales tax permit or the seller’s license, for which you will access the local government, the state or both.
In most states, businesses must register their business with a state tax agency and apply for tax permits.
It is a requirement that most states request companies to acquire a state sales tax permit in order to collect sales tax from customers. By following these steps to create a business, you have what it takes to start your own business.