Beginning a business can be an exciting and fulfilling experience, but the process taken to register a business can be daunting. With multiple steps to take and important choices to make, it's easy to understand why entrepreneurs can feel overwhelmed.
This comprehensive blog post will guide you through the steps required to register a business in the USA, offering valuable tips and resources to make your journey as smooth as possible.
Whether you want to establish a new business or register an existing one, this guide will assist you in passing through the process in 7 straightforward steps to register a business with assurance and ease.
For those who still find it challenging to register a business, we’ve created a list of some of the finest business registration services, like ZenBusiness, that can help you register a business.
How to Register a Business in the USA: 7 Simple Steps
It’s easy to register a business when one is aware of the necessary steps. To get the business registration going promptly, these are the seven steps to register a business in the USA.Step 1: Choose Your Business Structure
When you're getting your business up and running, the structure you pick should be based on the kind of venture you're launching and the growth level you expect.We’ve previously discussed the various incorporated and unincorporated business structures that are available to you, but let's now examine each one in greater detail. Remember, if you decide on one of the following structures, you’ll be legally obligated to register the business in the US.
Sole Proprietorship
When operating an unregistered business, there’s no distinction between you and the company. All the gains you make will be yours to keep. However, you will be required to pay taxes on them.Furthermore, your possessions could be utilized to pay off debts that the business has acquired or to cover any costs that may have arisen due to its activities (for example, if a client gets injured while using your product or service).
General Partnership
Two or more individuals own and run a general partnership. Just like a sole proprietorship, the partners are responsible for the company's activities and for any debts, taxes, and obligations that arise from legal decisions. They’re completely liable for these matters.Limited Partnership
A limited partnership is formed with one general partner responsible for the business and any of its losses. The remaining partners are called limited partners and are mainly there to provide capital.These limited partners aren’t involved in the company's management, and the extent of their liability is proportional to the amount of their investment.
Limited Liability Partnership
The acronym LLP refers to this kind of incorporated venture in which all partners are regarded as joint proprietors.Each partner's responsibility for any debts or activities of the business is proportional to their initial investment, meaning they cannot lose more than what they originally put in.
It's important to be aware of local laws since Limited Liability Partnerships may be limited to particular industries or occupations in some areas of the US.
Limited Liability Company
The Limited Liability Company, often called an LLC, establishes a legal boundary between the proprietors and the venture itself. Upon being formalized, an LLC is perceived as a legitimate element by itself.This structure is a great selection for proprietors of small businesses as their personal resources cannot be used to cover any of the business's financial obligations, and there are also certain tax advantages. It’s also much easier to register than a full corporation.
C Corporation
Establishing a C Corporation is accompanied by a set of responsibilities. These obligations include arranging annual meetings and selecting a board of directors through a voting process by the shareholders.Generally, C Corporations are large businesses with numerous investors and stockholders, and, like other incorporated entities, their individual and company assets and liabilities are legally separated.
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Step 2: Register Your Business Name
The selection of a name for your business registration can be done in multiple ways. These depend on the state you want to register a business in and the necessities of your entity. It's unnecessary, but using the same name for each business registration might be convenient.Here’s a breakdown of the three possible options. To begin with, you could register a legal entity name or a trademark. Additionally, you can register a legal name and use a different name for operations.
Lastly, you may also want to use all three methods to prevent any other entities from using the same name. It’s essential to check each state's regulations to ensure that all requirements are met.
Entity Name
The state requires you to register a business with a unique legal entity name to distinguish them from other companies.State laws regarding entity names vary; some areas have specific regulations regarding suffixes such as "incorporated," "limited," or "corporation," whereas others mandate that the name reflects the nature of the business.
Trademark
It's essential to register a business name with the US trademark office to protect your brand at a national level. Before selecting a name, it’s important to check the official trademark database to ensure it’s not already taken. Infringing on an existing trademark is a serious crime and could lead to legal action.Doing Business As
You have the option to register a business with a single, legitimate name and carry out operations under another. This is popularly known as a Doing Business As (DBA) name. Even though these names have to follow federal trademark rules, there isn't a necessity for them to be distinct at the state level.Step 3: Consider Taxes and Other Costs
Every state has its own set of regulations concerning business registration and taxes. This implies that enrolling in a particular region could bring some tax and other expenditure advantages.If you intend on engaging in business in numerous states, you should ascertain that your business is qualified to function in each one. Fortunately, you can make use of LLC registration services such as ZenBusiness to simplify the business registration process.
Step 4: Register and Acquire Licenses and Permits
The local government's regulations determine the steps to register a business in the US. These rules may differ depending on the jurisdiction, yet there are some fundamental steps you need to take.To begin with, you need to obtain an Employer Identification Number (EIN). This tax ID number is essential for paying taxes, taking advantage of tax deductions, hiring workers, and running the business. Additionally, you need to have the following pieces of information and paperwork:
- Identification information for the business's owner(s)
- An official place of business
- An official company name
- Articles of incorporation or creation
Document Type:
- Corporation: Incorporation documents
- LLC: Articles of organization
- LLP: Partnership contract
- Corporation: Bylaws of the organization
- LLC: The operational contract
- LLP: Partnership contract
- Corporation: Share certificates
- LLC: Member certificates
- LLP: Partnership contract
- Corporation: EIN (Employer Identification Number)
- LLC: EIN (Employer Identification Number)
- LLP: EIN (Employer Identification Number)
Step 5: Open a Bank Account for Your Business
Once you’ve acquired your EIN, you can go ahead and open up a bank account for your business. Organizations such as LLCs, LLPs, and corporations must open a business bank account, but those operating as sole proprietors or unincorporated partnerships aren't legally obligated.You just need to go to your local bank, fill out the required documents, and you're all set. Before settling, it's a good idea to compare the rates and advantages that different banks provide.
Even for those working alone or in a partnership, setting up a designated business bank account is a smart decision to keep your personal funds distinct from your business's. This way, it will be much easier to incorporate your business in the future if you decide to do so.
Step 6: Protect Your Intellectual Property
When forming a business, safeguarding certain aspects of your company is essential. A business's name, logo, and other aspects, such as product designs or works created, need to be protected from potential misuse.As soon as possible, it’s essential to begin securing these aspects of your company to prevent others from taking advantage of them.
Trademark
A trademark is a sign that distinguishes a particular product or service from its competitors. An example is McDonald's "I'm lovin' it." To be recognized, the trademark must be registered.This process usually takes four to six months. Once the trademark is registered, it’s safeguarded throughout the United States, and you can take legal action against anyone who uses it without your authorization.
Copyright
Copyright law secures original written works, software, web content, films, sound recordings, images, and other creations. Just the originator of the works has the right to duplicate, create adaptations of, or market intellectual property.Copyright is naturally given as soon as a new work is developed. The rights may be passed on to a different owner through sale, gift, or bargain.
Patent
If you've come up with a unique invention, you may want to consider obtaining a patent. This will give the holder exclusive rights to the item and disallow anyone else from creating, selling, or bringing in the patented item for a designated period.The patenting process is intricate and may take up to five years to complete, so it’s best to get started as soon as possible to protect your invention.
Step 7: Set Up Your Payment Infrastructure
To guarantee your business can start taking orders as soon as it’s officially registered, you'll need to ensure a convenient and hassle-free way to accept payments. Pay.com presents a complete payment system with no-code solutions and developer-friendly APIs. The system is simple to configure and personalize based on your business aims.Pay.com allows you to accept various payment methods, such as credit and debit cards, ACH transfers, digital wallets, and many more. Wherever you register a business and offer your products or services, you can enable your customers to pay with their favored methods through our secure platform.
>> Register Your Business With ZenBusiness >>
Best Business Registration Services
Entrepreneurs can benefit from the services of business registration providers. These business registration services have several features that can help get a company up and running, including registering a new business entity and acquiring the relevant licenses and permits.They provide the necessary compliance with regulations at the state and federal levels. Some services offer additional support through personalized consultation and continuous guidance to help businesses succeed.
ZenBusiness
Entrepreneurs and small business owners can turn to ZenBusiness for help establishing and developing their businesses. They offer budget-friendly packages, including registered agent services, annual report filing, and additional features.
Additionally, ZenBusiness is devoted to providing ongoing support and resources to help businesses stay compliant and successful.
Swyft Filings
Swyft Filings is an online business registration platform specializing in a quick and simple business establishment. Their services range from LLC formation to incorporation and compliance.
Additionally, Swyft Filings offers personalized guidance to assist businesses with the formation process and help them stay in line with state and federal laws. Read our review of Swyft Filings here.
Tailor Brands
Tailor Brands is an online platform that assists businesses in constructing a consistent brand identity. They offer a selection of branding packages that incorporate logo design, business card design, and social media branding.
Additionally, Tailor Brands provides extensive design tools and resources that allow companies to create and modify their branded materials.
Read the full Tailor Brands review.
Northwest Registered Agent
Northwest Registered Agent is a popular online company specializing in giving entrepreneurs and small business owners the resources they need to launch and develop their businesses.They provide personalized help and various business services, such as registered agent services, compliance management, and document filing. Furthermore, they offer business formation services for LLCs, corporations, and nonprofits.
With their high-grade customer service and commitment to quality, they’re relied on by businesses of all sizes. Read the complete Northwest Registered Agent review.
>> Try Northwest Registered Agent >>
Incfile
Incfile provides fast and budget-friendly business formation services. Their packages include a registered agent, compliance management, and document filing. Their user-friendly and streamlined platform simplifies the business registration process.Incfile also offers ongoing support and resources to help businesses meet their goals. Keeping affordability and convenience in mind, Incfile is a great choice for entrepreneurs starting a new business or registering an existing one.
Other Ways to Register a Business in the US
Register With Federal Agencies
Most businesses don’t need to be registered with the federal government other than to get a federal tax ID. However, some small companies will register to secure a trademark or become a tax-exempt entity.To trademark any business, brand, or product name, the USPTO should be contacted after forming the business. For nonprofits, registering with the IRS for tax-exempt status is essential. Lastly, form 2553 should be filed with the IRS for an S corp.
Register With State Agencies
To operate as an LLC, corporation, partnership, or nonprofit corporation. Individuals may need to register with the state where they’re doing business. This could be applicable if the following criteria are met:- There’s a physical location for your company in the state.
- You often meet with customers in person in the state
- Your business receives a significant amount of its income from the state.
- The state employs any of your personnel
- While some states require you to complete physical forms in person or by mail, others let you register online.
Register With Local Agencies
Forming a business generally doesn’t require signing up with local government entities. If your business is an LLC, corporation, partnership, or nonprofit corporation, you may need to acquire licenses and permits from the county or city.Certain counties and cities also necessitate registering a DBA or assumed business name if you are using one. To discover what is necessary for your business, it’s suggested to check out the websites of local governments as they determine the business registration, licensing, and permitting requirements.
Benefits of Registering Your Business
While it’s not mandatory to register a business in the US, there are numerous advantages to doing so. By choosing to register a business, you can unlock a host of benefits that are otherwise unavailable.Through business registration, these advantages can include:
- Your taxable rates
- The deductions you may make
- Who’s responsible for your company's obligations?
- Your necessary reporting requirements
Find Out if You Need to Register Your Business
To register a business, you must first determine your business's location and structure. The process is generally uncomplicated for small businesses and can be done by registering the name with state and local governments.However, if you use your legal name to conduct business, you don't need to register a business anywhere. But remember that if you don't perform the business registration, you could miss out on personal liability protection and legal and tax advantages.
Do I Need to Register an Online Business in THE US?
In the United States of America, regulations for online enterprises are the same as those for traditional ones. As the company's owner, you have complete control over whether or not to register a business.There’s no legal need for registration for sole owners and general partners. On the other hand, limited partnerships, Limited Liability Companies (LLCs), and corporations do.
Is it worth it to register your online business? That depends on where your customers are located. Credibility is increased by registration if you aim to market your products or services on a national or worldwide scale.
Many modern online buyers conduct their homework before purchasing since they’re so sophisticated. Adding a company suffix (such as limited, incorporated, or corporation) to your business name might reassure certain consumers that you mean business.
If you’re unsure how to register your company, it would be wise to use one of the many internet services, such as ZenBusiness, Swyft Filings, or Tailor Brands, to help you out.
>> Register Your Business With ZenBusiness >>
How to Register a Business – Frequently Asked Questions
What Do I Need to Register a Business in The US?
Getting started with a business in the US is usually easy. Begin by choosing a suitable name for your business. Then, you must decide which state you want to join and incorporate in.When you decide to register a business, it's essential to anticipate the paperwork and monetary requirements that come with it. The registration cost of an LLC can vary depending on the state, ranging from $250 to $1,500.
If you're looking to register a business and complete the necessary paperwork, contacting the appropriate local governing bodies is essential. They can help you determine the amount you must pay for the process.
How Can a Foreigner Start a Business in The US?
Whether you're a US resident or an individual from another country, the process to register a business in the US remains the same.Depending on your visa status, it may be advantageous to form a corporation or an LLC so the business can continue even when the foreigner is not in the US.
Can a Non-Citizen Start a Business in The US?
Yes. It can be asserted that the United States is aptly referred to as the "land of opportunity." There’s no need for entrepreneurs to have citizenship or need to be a resident of the US to launch a business in the country.Bottom Line on How to Register Your Business
Filing documents for registering a business in the US can be overwhelming and intimidating. To help alleviate this stress, below is a simple process to ensure you register a business correctly.ZenBusiness is our recommendation for those looking for business registration services. They offer various services to assist with everything from business registration to acquiring business licenses and permits and filing reports.
Moneycontrol Journalists were not involved in the creation of the article.
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