A man wearing an apron stands in the entry way of his business. In the background, the store is outfitted with wood-top tables and shelves of dark bottles. The man holds a sign that says "we are OPEN" and "supporter small businesses." "OPEN" is written in bold blue letters, with the other words arranged above and below in blue cursive.
Whether you're setting upward as a sole proprietor or starting an LLC, you need to register your business. — Getty Images/Dan Rentea

Starting a business is an exciting, independent venture filled with many decisions. Earlier launching, notwithstanding, you lot'll need to register your visitor with the appropriate agencies. Completing the registration process swiftly and accurately will help yous put the correct human foot forward and be well on your style to success.

Here's how to register your business organisation.

[Read more than: Demand a Business concern Idea? Hither's Where to Start ]

Ascertain your business structure

Different business types volition have different registration requirements, so it's crucial to make certain you undergo the correct process for the structure best suited to your business goals. This volition also determine which income taxation return forms yous volition need to file. Here are some of the most common business concern entities:

  • Sole proprietorship. A sole proprietor serves as the only possessor of an unincorporated business organisation. This is considered the default business construction. In a sole proprietorship, the proprietor'south business concern and personal assets and liabilities are not separated. Note that sole proprietorship is different from being the sole member of a limited liability corporation.
  • Partnership. If two or more individuals ain a business organisation together, they are entering into a partnership. At that place are multiple types of partnerships merely the most common are limited partnerships (LPs) and limited liability partnerships (LLPs). In an LP, one partner is exposed to personal liability while the other partners take express liability. In an LLP, all partners are personally protected from whatever business concern debt.
  • Limited liability corporation (LLC). Starting an LLC allows an individual to protect personal assets from business liabilities. An LLC's profits and losses are then taxed as personal income or loss. Annotation that even if someone is the just fellow member of an LLC and their business concern is functioning as a corporation, they are non considered a sole proprietor.
  • Corporation. In this structure, a business operates as a separate legal entity from its owners, offer the most protection for any personal avails. The default corporation condition is a C corporation, which is a separate taxable entity that files a corporate taxation return. An S corporation, on the other hand, has taxes "passed through" to the business and reported on an owner's personal tax return.

Federally registering a business organization is a relatively simple process.

When to file with the federal government

Some businesses, especially single-person entities using their legal name to comport business, don't necessarily need to register with the federal government. However, not doing so may hateful missing out on potential tax exemptions and more than benefits.

Business concern owners who desire to trademark their company, brand or product proper noun must file with the United States Patent and Trademark office (USPTO). Sure corporations (such as nonprofits) tin likewise receive taxation-exempt status by registering every bit a tax-exempt entity with the IRS. Finally, businesses must be a federally recognized entity to apply for government contracts — and so if your business concern plans to bid on government contracts, ensure you lot're filed with the federal government.

Federally registering a business organisation is a relatively elementary process. In many cases, business owners simply apply for a federal taxation ID, usually referred to as an employee identification number (EIN) and the process is complete.

[Read more than: How to Register Your Business With the Federal Authorities ]

How to register your business

In one case you've defined your construction, you'll need to register at the following places to beginning your business organisation:

  • Register your business name. This step is typically part of the process of registering separate entities, such as LLCs or corporations. However, if you are starting a sole proprietorship or partnership under a proper name that is different from your own, you may need to file a "doing business organisation as" or DBA name. Yous will also need to ensure that your chosen business organisation proper noun is eligible for employ.
  • Register with the IRS. For businesses that are required to (or may otherwise opt to) register at the federal level, the next step is registering with the IRS to receive an EIN. The awarding procedure is free of accuse and can be completed online, past mail, by fax or by phone. To do this, yous must possess a valid taxpayer identification number, such as a Social Security number.
  • Annals with local or state offices. Most business structures will require y'all to register with state offices, such as the Secretary of State'southward office or a business organisation bureau. Certain counties and cities may also require you to register your DBA proper noun (if y'all have one).
  • Apply for permits. While you typically won't have to register with county or city governments to course your business, you may demand to file for local permits to go operational depending on your location or what your chosen manufacture requires. Visit your local authorities websites for more information.

[Read more: When — and Why — to Consider Irresolute Your Business Entity ]

Stay tuned for our next Startup2021 article on trademarking your business name.

CO— aims to bring you inspiration from leading respected experts. Withal, before making any business concern decision, yous should consult a professional person who tin advise you lot based on your individual situation.

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CO—is committed to helping you start, run and abound your pocket-sized business. Learn more than about the benefits of pocket-size business membership in the U.S. Bedchamber of Commerce, hither.

Published June 24, 2021