7 Actionable Steps to Start Your Business
If you are in the United States and want to start your own business, we have 7 actionable steps that can help you get started. These steps are important to follow for everyone who is new to the world of business. Without further ado, let’s check out the 7 steps.
- Decide on the Business Type
First off, you need to decide on a business type that is right for you. Make sure it’s high in demand. Your decision will have an impact on everything including routine operations, taxes, and the risks you will take. Given below is the description of three business types you can choose from:
LLC: It’s an ideal choice for both US or Non-UL residents. LLC refers to a limited liability company, which is a specific type of private limited company.
C-Corporation: In this type of corporation, the owners and the corporation are taxed separately.
S-Corporation: It’s ideal for US residents. S-Corporation is short for a small business corporation. These common business corporations elect in order to pass credit, deductions, losses, and income to all the shareholders for tax filing purposes.
Sole proprietorship: This is a simple form of business and requires no formal filings.
- Hire the services of a Registered Agent
If you start an LLC or Corporation, you must get a Registered Agent. Make sure they have a physical address. During business hours, they receive business files on behalf of companies. The agent must be from the same state where your business is registered.
The documents they receive are related to important renewal notices or lawsuits filed against your business. Although you can take care of all these matters yourself, hiring an agent is a better idea.
- Get your S-Corporation or LLC registered
Next, you have to register your S-Corporation or LLC, which requires the necessary files to be filed. You can get help from your agent to ensure everything is done right. Although you can handle this process yourself, it will require a lot of time and patience.
The time it takes to complete the registration process depends on the state your business is located in, your business type and the Secretary of State. Usually, it can take between 1 and 4 weeks.
- Apply for an EIN
In the US, every business requires an EIN, which is short for Employer Identification Number. This is a requirement to start a business. Basically, this Tax ID is issued by the IRS for the identification of a business.
Just like a social security number, an EIN is required for a business to start business activities legally in the States. Given below are the reasons why you need an EIN:
- File taxes
- Hire employees
- Get business licenses and permits
- Initiate your business
- Open a business bank account
You can check out the IRS website to get your EIN.
- Apply for a US mailing address
Almost all US businesses must get a residential or mailing address in order to open a business account with a bank. Given below are the authorities that can provide a mailing address for your business:
- USAMail1.com
- TravelingMailBox.com
- Sasquatchmail.com
- PhysicalAddress.com
- iPostal1.com
- EarthClassMail.com
- Apply for a U.S. business bank account
To create a business bank account, you have to visit the bank in person. It’s better to contact the bank by call or email to confirm their requirements. Although you can contact the bank yourself, it’s better to consult your agent first. They will help you prepare the required documents for you.
- Create a business merchant account
You need a business merchant account to receive payments from your customers or clients. Your buyers can pay you through their credit card, debit cards or other payment methods. If you want to open a merchant account, you can choose from any of the following options:
- PayPal.com
- Authorize.net
- Braintreepayments.com
- Payoneer.com
- Stripe.com
- Get business insurance (Optional)
With business insurance, you can protect yourself in case of lawsuits, natural disasters and accidents, for instance. These events can throw your out of business unless you have the right insurance policy.
It’s important to keep in mind that the insurance policy can only protect your personal assets in case of lawsuits. Besides, the protection is quite limited. In other words, the role of business insurance is to make sure your business assets and your personal assets won’t be impacted as a result of unexpected catastrophes.
In short, if you are planning to start a business in the United States, you should be prepared to go through these steps. This will help you avoid common hassles and have a great start.
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