A new business venture can be both exciting and frightening at the same time. It is important to always conduct thorough research, consult with professionals, and not cut corners.
Based on data from the Census Bureau, we know that the paperwork for 4.3 million businesses was filed by Americans alone last year. This is a 24% increase to last year’s figures and applications are projected to be even higher this year.
The New York Times reported that the surge was a drastic turnaround after the 40-year decline that U.S entrepreneurship had seen. The drawn-out decline that troubled economists since start-ups are a key source of job growth. The publication stated that the turnaround will now contribute to a more “dynamic, productive economy” which will allow the country to rebound more efficiently from any future recessions.
When opening up a new business there are a multitude of factors to take into account and apart from providing an excellent product or service, entrepreneurs are required to have an understanding of the administrative and legal factors that go into registering a business. Stay focused on your goal and remember that patience is key to ensure the smooth and successful registration of your new venture.
How to register your business
Decide on an entity
The structure of your business entity will ultimately govern the requirements you need to meet for setting up your business. Whilst there are a variety of options to choose from, the most popular entity choices are:
- Sole Proprietorship – The simplest form of business entity and is owned by just one person.
- Partnership – Ownership is shared between two or more people, corporations, other partnerships, LLCs, trusts, or others.
- Business Corporation – This entity is established by one or more individuals. There are various types of Corporations and their laws are governed by the individual states.
- Limited Liability Company- Often considered as a hybrid of a corporation and a partnership.
Decide on a state
Once you have decided on your business structure, you can then proceed to decide on which state works best for you. Whilst many people tend to opt for registering within their home states, it may not always be the most profitable option. Remember, the state you register in does not mean that your business is required to have a physical presence in that location. Your location for registration will be the address that you use when completing tax filings, to receive documentation from government agencies, and for your business’s bank account.
Decide on a business name
This is one of the most exciting parts of the process. The business name that you decide on should accurately describe your business and embody the essence of your brand. Your name should be unique and easy to remember, it is important to ensure that your chosen name does not infringe on any copyright that another entity has already filed. Research the state databases for similar or abbreviated versions of your name as well.
Find a registered agent
When registering a company, one can easily get overwhelmed with the vast amount of paperwork and legal issues that come along with the process. So much so that it might be tempting to give up on the process altogether. However, this issue can easily be solved by utilizing the services of a qualified, professional, and reputable registering agency. Whilst there are a lot of options available, entrepreneurs should always conduct thorough research before committing to a company.
Getting quality service at affordable rates is key. Incfile, for instance, is one of several companies that provide dependable service and we find their silver package fee of $0 very attractive. For further details, Incorporation Guru has a review of IncFile that dissects the company’s service.
To drastically simplify the process we recommended using a reputable registering agency that will guide you through the process and ensure that all of your paperwork is completed and filed correctly. They will also be able to advise you on any legal issues as well as explain any grey areas that you may exist.