When you set up a business, you have to carefully select a few things without regretting your decision at a later stage. These examples can be the name of your business, the state you wish to start your business in and even your business idea.
We have listed a few key points that highlight specifically about what to consider when you want to start a business in your state.
It is a fact that most businesses do require for you to have an EIN (Employment Identification Number). This is especially important for businesses who need it, since it is basically your Tax ID Number. There are some businesses that are exempt to that, but the majority of businesses need to follow through with this procedure. On top of that, there are also state taxes that you need to keep in mind too. Before you do decide on which state you wish to register your business in, it is best to look at the tax percentages that may play a beneficial role for your company.
If you are planning on setting up a business that specialises in selling physical products, then you need to also register for a Sales Tax in the state that you are applying for. However, there are five states that are exempt from Sales Tax, which are: Alaska, Delaware, Montana, New Hampshire and Oregon.
One more thing that you need to consider is that if you are planning on hiring employees for your business, then you need to also register Unemployment Insurance Tax and state income tax for your employees.
The business structure
When it comes to planning your business, you need to also focus on the business structure that you’re planning on registering for. Each state has different regulations and processes on how to register for your business structure, including potential fees and costs that you may be required to pay for.
There are different types of business structures that you need to look at, such as an LLC, corporation, non profit organisation, sole proprietorship and partnership. There are guides online that can help assist you with the registration process for the state that you choose.
Following under the business structure category, state permits and licenses are also important factors to look at, since the state you may want to set up your business in can have rules and regulations on how your business can operate with a certain state permit or license.
Naming your business
While all states may have exemptions or different rules for businesses, they do have a mutual ground on how you should name your business. The name that you choose for your legal entity should not be similar or the same as an existing business. It needs to be unique and there are tools available online such as a business name generator, that can help suggest names and domains available for you.
You can also search up your business name idea in the U.S. Federal Trademark Search, where they can see if the name is not similar or the same as an existing business. Once you have selected the name, you can continue to the register process in the state that you are applying in.
Even though it is an exciting chapter as a new business owner to set up a business, it is always vital to check the regulations and rules that the states have. You may be eligible to start up and register your business in a different state that you are living in, or you may be required to pay the Sales Tax, depending on which field you wish to go into. It is necessary to check out the useful guides online that have detailed steps for different states and what to do. It can also be beneficial to use the free tools online, to help overcome any obstacles for your business.