From market research to articles of incorporation, businesses must complete mountains of paperwork. However, there are several important documents business owners must complete starting. Before you open your company, you can complete the following paperwork immediately.
Create a Detailed Business Plan
Having a business plan might not be a legal requirement, but they are still crucial for newfound companies. Otherwise, convincing financiers to lend money to you will be more difficult. Start by writing an intelligent executive summary describing your products and services.
Afterward, your financial plans should be put down on paper clearly and succinctly. Explain the pricing model of your products, and describe a typical client. During this process, adding relevant market research will improve the document’s credibility.
Select a Suitable Business Structure
When forming a business, choosing a structure is one of the most important decisions. Typically, new companies will select an LLC or limited liability corporation. Businesses must file articles of organization and an LLC operating agreement first. These describe how you anticipate decisions will be made and the company’s structure.
Limited Partnerships must obtain a certificate of limited partnership and an agreement. Furthermore, it notifies the state about the company’s existence and intentions. Even if these are not mandatory in your state, they are worth filing.
Articles of incorporation are require by every state if you want to incorporate. In addition, you may need to file multiple bylaws and resolutions to finalize the details.
Register the Business’s Name
Registering a company will require several forms, including a trademark. The entity name, trademark, DBA name, and domain name are independent entities. Therefore, you must secure the naming rights for each one individually.
After your business structure has been finalized, register with the applicable state registers. Registering with them will secure the naming rights, preventing competitors from stealing it.
Acquire the Appropriate Licenses
Many companies must obtain licenses to practice in their specific industry. Otherwise, they could be given fines for violating state trade laws. Avoid this and pay for any licensing fees early on in the formation process. Occasionally, there will not be any state licenses required for your business.
Nevertheless, you may still be subject to city, county, or federal requirements. You may speak with a specialist about how to start a small business to ask for help. Usually, they can inform you about any necessary licenses or permits, so you can work legally.
Research Business Tax Information
Even though you have been paying taxes for years, business tax implications differ. This adjustment requires a state tax ID and a federal tax ID. This is the Employer Identification Number, and it is similar to a social security number. Before a business can open a bank account, it must get an EIN. Fortunately, applying for an EIN is free, and you can do everything online.
There may or may not be a state-level equivalent depending on your state. If your business will be liable for state taxes, it needs a state ID number.
Since state tax obligations vary, you should research info on your state’s website. Only seven states eliminate income tax requirements for businesses altogether.
Secure Adequate Financing
Financing for a business is a massive hurdle, but it will help your company be funded. Bring your detailed business plan and your EIN to a lender. After they have received your info, they will provide an estimate on financing.
Additionally, you can speak to the Small Business Administration about obtaining a loan. Since they are a government institution, they can fund businesses in many cases. Even if you were denied by traditional lenders, it is worth speaking to them.
Learn About Business Insurance
If you are running a company, service disruptions can impact your finances tremendously. Consequently, it may be wise to carry numerous insurance policies. Workers’ compensation insurance is crucial for any business with employees. Nonetheless, business income insurance and general liability insurance are worth considering. Moreover, product liability insurance can protect you if a product fails.
Starting a Small Business for the First Time
Running a company takes time, dedication, and effort, but anyone can do it if they are willing. First, all the paperwork must be complete, and then you can focus on captaining the company.