Starting Your Business

Deciding to start a business is an exciting step toward entrepreneurship. While the decision to begin may be easy, the steps that follow can involve important planning, filing, tax, licensing, and compliance considerations.

The following are common items to consider when starting a business.

A business plan helps outline the direction, purpose, and goals of the business. It does not need to be overly complicated to be useful, but it should provide a clear roadmap for how the business will operate and grow.

A business plan may include:

• Company objectives;
• Mission statement;
• Description of products or services;
• Ownership and management structure;
• Target customers;
• Competitor analysis;
• Marketing strategy;
• Pricing strategy;
• Startup costs and operating budget;
• Revenue projections;
• Financing needs;
• Business location; and
• Short-term and long-term goals.

The plan should be reviewed and updated as the business changes. If the business is not meeting expected goals, the plan can help identify what needs to be adjusted. The U.S. Small Business Administration describes a business plan as the foundation of a business and provides resources for creating one.

A marketing plan identifies how the business will attract and retain customers. It should define the target market, explain how the business will reach that market, and describe how the business will distinguish itself from competitors.

A marketing plan may include:

• Target audience;
• Branding and messaging;
• Website and online presence;
• Social media strategy;
• Advertising budget;
• Referral sources;
• Email marketing;
• Networking or community outreach;
• Sales process;
• Customer retention strategy; and
• Methods for tracking results.

Marketing efforts should be measured regularly. Tracking return on investment can help determine which activities are generating results and which may need to be changed.

The right business location depends on the nature of the business. Some businesses can operate from home, while others may need a storefront, office, warehouse, manufacturing space, or other physical location.

When selecting a location, consider:

• Whether customers will visit the location;
• Whether employees will work there;
• Proximity to suppliers or vendors;
• Zoning restrictions;
• Lease terms;
• Local business license requirements;
• Parking and accessibility;
• Signage rules;
• Sales tax or local tax obligations; and
• Whether the business will operate in multiple states or local jurisdictions.

Even online and home-based businesses may have licensing, zoning, tax, or registration requirements depending on where the business is located and where it conducts activities. The SBA notes that a business location can affect taxes, legal requirements, and revenue.

Many small businesses are self-funded, but financing may also come from personal savings, loans, investors, grants, or contributions from family and friends.

Common financing options may include:

• Personal savings;
• Loans from family or friends;
• Bank loans;
• SBA-backed loans;
• Lines of credit;
• Equipment financing;
• Investor funding;
• Venture capital;
• Crowdfunding;
• Federal, state, or local grant programs; and
• Business credit cards.

Business owners should carefully consider repayment obligations, ownership dilution, personal guarantees, interest rates, and the legal or tax consequences of any financing arrangement.

Choosing the legal structure of the business is one of the most important early decisions. The entity type can affect taxes, liability protection, ownership, management, financing, recordkeeping, and ongoing compliance requirements. The SBA notes that business structure affects tax payments, the ability to raise money, required paperwork, and personal liability.

Common business structures include:

• Sole proprietorship;
• General partnership;
• Limited partnership;
• Limited liability partnership;
• C-Corporation / S-Corporation;
• Professional corporation;
• Limited liability company;
• Professional limited liability company;
• Nonprofit corporation; and
• Benefit corporation or public benefit corporation, where available.

State law controls the formation and governance of business entities. Federal tax law controls how the business is taxed. For example, an S corporation is not a separate state-law entity type; it is a federal tax election available to certain eligible corporations and LLCs.

Business owners should speak with an attorney and accountant before selecting a structure.

Once the business structure is selected, the business may need to be registered with the appropriate state or local agency. Corporations, LLCs, nonprofit corporations, and similar entities are typically formed by filing formation documents with the Secretary of State, Division of Corporations, or similar state filing office.

Depending on the business structure and location, registration steps may include:

• Filing formation documents with the state;
• Registering a DBA, assumed name, trade name, or fictitious business name;
• Appointing a registered agent;
• Obtaining certified copies or evidence of filing;
• Registering to do business in other states, if applicable;
• Obtaining local business registrations; and
• Preparing internal governance documents, such as bylaws, operating agreements, resolutions, or partnership agreements.

Accumera can assist with preparing and filing formation documents, DBA filings, registered agent services, certified copies, and related state filing services.

After the business is formed or organized, it may need a Federal Tax Identification Number, also known as an Employer Identification Number or EIN. An EIN is used to identify the business for federal tax purposes. The IRS states that an EIN is a federal tax ID number for businesses, tax-exempt organizations, and other entities.

Depending on the business structure, activities, employees, and locations, a business may also need to register for:

• State income tax;
• Sales and use tax;
• Payroll withholding tax;
• Unemployment insurance;
• Workers’ compensation;
• Local business taxes;
• Franchise or privilege taxes;
• Excise taxes;
• Industry-specific taxes; and
• Other federal, state, or local tax accounts.

Tax obligations vary by entity type, tax classification, location, and business activity. Business owners should consult with an accountant or tax advisor regarding required federal, state, and local tax registrations and filings.

A business bank account helps separate business finances from personal finances and can support better accounting, tax reporting, and recordkeeping.

When opening a business bank account, the bank may request:

• EIN confirmation letter;
• Filed formation documents;
• Operating agreement, bylaws, or partnership agreement;
• Ownership information;
• Personal identification for authorized signers;
• Corporate resolutions or authorization documents;
• Business license information, if applicable; and
• Address and contact information.

Requirements vary by bank, entity type, and account type. Business owners should compare banking options, including online banking access, monthly maintenance fees, transaction limits, branch access, wire/ACH capabilities, and customer service.

Many businesses need licenses, permits, registrations, or approvals before conducting business. Requirements may apply at the federal, state, county, city, town, or other local level.

Licensing requirements depend on the business activity and location. For example, restaurants may need food service permits, health permits, alcohol beverage licenses, signage permits, and local business licenses. Construction companies, professional service firms, retailers, wholesalers, online businesses, and home-based businesses may also have licensing or registration obligations.

Licenses and permits may include:

• General business licenses;
• Professional or occupational licenses;
• Sales tax permits;
• Food establishment permits;
• Alcohol or tobacco licenses;
• Contractor licenses;
• Health department permits;
• Home occupation permits;
• Sign permits;
• Local registrations; and
• Industry-specific approvals.

Accumera can assist with business license research and, where available, preparation and filing of license applications.

If the business will have employees, additional registrations and compliance steps may be required. Employers generally need to maintain accurate payroll and employment records, withhold and remit taxes, report wages, and comply with federal and state employment requirements.

Employment-related considerations may include:

• Federal payroll tax withholding;
• State payroll tax withholding;
• Unemployment insurance registration;
• New hire reporting;
• Workers’ compensation insurance;
• Employment eligibility verification;
• Required workplace posters;
• Wage and hour requirements;
• Employee handbooks or policies;
• Payroll processing;
• Employee benefits; and
• Recordkeeping obligations.

Business owners may wish to work with a payroll provider, accountant, or employment advisor to help manage payroll registrations, filings, and ongoing compliance.

If the business plans to provide benefits, such as health insurance, retirement plans, or other employee benefit programs, additional setup and ongoing administration may be required.

Starting the business is only the beginning. Most businesses have ongoing obligations after formation.

These may include:

• Annual, biennial, or periodic reports;
• Registered agent renewals;
• Business license renewals;
• Tax filings;
• Payroll filings;
• Franchise tax payments;
• Corporate minutes or written consents;
• LLC resolutions or company records;
• DBA renewals;
• Beneficial ownership or ownership records, where applicable;
• Foreign qualification maintenance; and
• Updates when company information changes.

Maintaining an internal compliance calendar can help keep important deadlines organized.

Accumera can assist with many of the filing and compliance steps involved in starting and maintaining a business, including:

• Entity formation filings;
• Registered agent services;
• EIN assistance;
• DBA, assumed name, trade name, and fictitious name filings;
• Certified copies and good standing certificates;
• Business license research and filing assistance;
• Foreign qualification filings;
• Annual and periodic report filings;
• Amendments and change filings; and
• Ongoing compliance support.

Please Contact us now to place an order or for more information on the process.