How to Register a Business in 2023: Step-By-Step Guide
Registering a business can be an exhilarating and fulfilling venture, but registering your business may appear overwhelming. With numerous steps to follow and crucial decisions, it’s no surprise that many entrepreneurs feel daunted. However, registering your business doesn’t have to be a complicated endeavor.
In this blog post, we’ll provide a step-by-step guide to the registration process, along with helpful tips and resources to make the journey smoother. Whether you’re launching a new business or registering an existing one, this comprehensive guide will assist you in navigating the process confidently and effortlessly with seven simple steps to register a business.
If, despite this guidance, you still find the process intimidating, we’ve compiled a list of top-notch business registration services, such as ZenBusiness, that can handle the task for you.
How to Register Your Business in 7 Simple Steps
Registering a business can be straightforward if you have the right knowledge. To expedite the process and start your business promptly, adhere to these seven steps.
Step 1: Choose Your Business Structure
Selecting the most suitable business structure for your company relies on the nature of your business and your growth aspirations. We have previously discussed the various options available, both incorporated and unincorporated, so now, let’s delve deeper into each of these choices and their operational mechanisms.
It’s important to note that registering your business is only necessary if you opt for an incorporation-based structure. This includes the following options.
In this particular form of unincorporated enterprise, there exists a lack of distinction between your personal self and your business entity. While you can retain all the profits generated, you are liable to pay income tax on them. Your personal assets may be utilized to settle any outstanding debts or expenses arising from the actions of your business, such as if a customer sustains an injury while using your product or service.
In the realm of business, a general partnership refers to a company that is jointly owned and managed by two or more individuals. Just like a sole proprietorship, the partners bear full responsibility for the actions of the business, including the need to personally cover debts, taxes, and any obligations resulting from legal proceedings.
Within a limited partnership, a minimum of one general partner exists who manages the business and assumes complete responsibility for any financial setbacks or losses. The remaining partners, identified as limited partners, primarily function to contribute financial investments. These partners don’t participate in the everyday management of the business, and their financial risk is restricted to the extent of their investment in the enterprise.
Limited Liability Partnership
Also known as an LLP, every partner in this kind of incorporated enterprise shares ownership of the business. Their financial obligation for the company’s debts and activities is commensurate and confined to their primary investment, meaning their potential loss is only as much as they have invested. Limited Liability Partnerships might be limited to specific sectors and professions in certain regions of the US, hence the importance of verifying local rules and regulations. The tone used is formal and professional.
Limited Liability Company
Referred to as an LLC, a Limited Liability Company establishes a lawful distinction between the company and its owners. Once incorporated, an LLC is acknowledged as a separate legal entity.
For proprietors of small businesses, an LLC is a favorable choice. This is due to the fact that personal assets are protected from being utilized to cover business debts, along with the presence of certain tax advantages. The registration process is significantly less complex compared to that of a comprehensive corporation. The tone of voice is formal and professional.
C Corporations typically represent sizable organizations that encompass numerous investors and stockholders. Similar to other corporate businesses, a C Corporation ensures a legal distinction between the assets and liabilities of the owners and the business.
Setting up a C Corporation carries with it an array of obligations. Among these are the requirement to conduct yearly meetings and the necessity of a board of directors, who are elected into their positions by the shareholders. The tone of voice is professional and formal.
Step 2: Register Your Business Name
There exist three methods for naming your business: registering a legal entity name, applying for a trademark, or operating under a distinct name from your legal registration. Bear in mind that the rules and regulations for naming differ across states, so it’s crucial to familiarize yourself with the specific requirements of the state you plan to register in.
Much like the process of incorporating your business, the path you opt for when naming your business hinges on the specifics and needs of your entity.
You might consider leveraging all three methods to ensure exclusive rights to your business name. You also have the freedom to pick just one method. While it’s not mandatory, it might be beneficial and logical to use the same name across all registration methods.
Now, let’s delve deeper into each of these naming alternatives.
The majority of states mandate that businesses establish a unique legal entity name for identification purposes. This ensures your business name remains distinct and safe from duplication by others.
The regulations governing the naming of businesses vary subtly across different states. Some states have specific rules pertaining to the suffixes of a company name, such as incorporated, limited, or corporation. In contrast, other states necessitate that the business name accurately represents the nature of the business being registered.
A trademark ensures nationwide protection for your business name. With a trademark, your business name becomes exclusive to you across the United States, preventing others from using it when registering their business.
When considering a name, it’s advisable to check the official US trademark database to ensure it’s not already in use. Undertaking this crucial step helps avoid trademark infringement, a criminal violation that could lead to legal proceedings.
Doing Business As
In addition, there’s an alternative of registering your business with an ‘official’ name and running it under a different one. This alternative name is referred to as a Doing Business As (DBA) name. While DBA names are still governed by federal trademark laws, there is no mandate for them to be distinctive at the state level.
Step 3: Consider Taxes and Other Costs
Every state imposes its unique regulations related to business registration and taxation. As a consequence, registering your business in a specific state could result in certain tax advantages and additional cost savings.
If your business operations span across multiple states, it’s necessary to confirm that your business meets the qualifications to function in each of these states. As a tool to simplify this process, business registration services such as ZenBusiness are available for your convenience.
Step 4: Register and Acquire Licenses and Permits
The procedure for incorporating your business is determined by the local governing body in the jurisdiction where you intend to register. While regulations differ from state to state, there are certain standard prerequisites.
Initially, you will need to acquire an Employer Identification Number (EIN). This is a unique tax identification number that ensures your business is properly registered for tax purposes, can avail deductions, employ staff, and carry out other essential activities. You will be required to provide specific information and documentation to complete the process.
articles of formation or incorporation
- An official business name
- An official business address
- Identifying information about the company owner(s)
The documentation required for submission to your local governing body will vary based on the nature of your intended business registration.
- LLP: Partnership agreement
- Corporation: Articles of incorporation
- LLC: Articles of organization
- LLC: The operating agreement
- Corporation: Organizational bylaws
- LLP: Partnership agreement
- LLC: Member certificates
- Corporation: Share certificates
- LLP: Partnership agreement
- 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 obtain your EIN, it becomes possible for you to establish a business bank account. The regulations governing LLPs, LLCs, and corporations necessitate the need for a business bank account. Sole proprietors and unincorporated partnerships are not required to maintain separate personal and business accounts.
To open a business bank account, all you need to do is visit your local bank and complete the necessary paperwork. It’s advisable to explore different banks and compare their rates and benefits before selecting the most suitable provider.
Even if you’re operating as a sole proprietor or unincorporated partnership, it’s still recommended to have a dedicated business bank account to ensure the segregation of your personal and business finances. This will prove advantageous in the future if you choose to incorporate your business, saving you from unnecessary complications.
Step 6: Protect Your Intellectual Property
Depending on the nature of your enterprise, you may possess valuable Intellectual Property (IP) that necessitates protection.
For instance, most businesses aim to secure exclusive rights to their name and logo, preventing any unauthorized use by third parties. Depending on whether you deal in goods or services, you may also wish to safeguard the design of your products or the creative works you produce, such as writing, designs, or music.
There exist various methods to achieve this, and it’s advisable to initiate the necessary applications promptly to ensure that your IP remains inaccessible to others.
A trademark is a distinctive word, phrase, symbol, sign, or emblem used to distinguish a product or service from others in the same category. Examples include Nike’s Swoosh and McDonald’s iconic “I’m lovin’ it” slogan.
To gain legal recognition, trademarks must be registered, a process that typically takes around four to six months. Once registered, your trademark is protected nationwide, allowing you to take legal action against unauthorized usage.
Copyright law safeguards original works such as written content, software, web materials, films, audio recordings, images, and more. Only the creator possesses the rights to distribute, reproduce, create derivative works, or sell intellectual property.
Copyright protection is automatically granted upon the creation of a new work. Ownership rights can also be transferred through sale, gifting, or other agreements.
If you have developed a new product or machinery, seeking a patent is crucial. A patent grants exclusive rights to the inventor, prohibiting others from manufacturing, selling, or importing the patented item for a specified duration.
The patent application process is intricate and may take up to five years to complete. Therefore, it’s advisable to initiate the process early if you wish to safeguard your unique invention.
Step 7: Set Up Your Payment Infrastructure
To ensure your business is prepared to serve customers immediately after registration, it’s essential to have a convenient and straightforward payment solution.
Pay.com is a comprehensive payment infrastructure that offers no-code solutions and developer-friendly APIs. The platform is highly adaptable and can be easily configured and personalized to align with your business objectives.
With Pay.com, you can accept a wide range of payment methods, including credit and debit cards, ACH transfers, digital wallets such as Apple Pay and Google Pay, and more. Regardless of where you choose to register your company and conduct sales, the secure platform enables your customers to pay using their preferred methods.
Read more: How to register a business in Indiana
Best Business Registration Services
Business registration services provide a comprehensive range of vital solutions to assist entrepreneurs and small business owners in establishing and overseeing their companies.
These services encompass registering new business entities, acquiring required licenses and permits, and adhering to state and federal regulations. They offer personalized consultation and ongoing support to ensure the success of businesses.
ZenBusiness is an excellent online LLC formation service that caters to the needs of entrepreneurs and small business owners. They provide a wide array of services to assist in the formation and growth of companies. Their business formation packages are reasonably priced and come with valuable features like registered agent services and annual report filing.
What sets ZenBusiness apart is their ongoing support and resources, ensuring businesses stay compliant and thrive. With ZenBusiness, starting and maintaining a successful company has never been easier.
Swyft Filings is a top-notch online service that focuses on expediting and simplifying the process of registering a business. They offer an extensive array of services, such as LLC formation, incorporation, and compliance, ensuring that businesses can get up and running swiftly.
Swyft Filings prides itself on providing personalized assistance, guiding businesses through the formation process, and ensuring they remain compliant with state and federal regulations. With their expertise and wit, Swyft Filings is the perfect companion for businesses looking to establish themselves professionally.
Tailor Brands is an online branding and design service that helps businesses create a professional and cohesive brand identity.
They offer a range of branding packages that include logo design, business card design, and social media branding. Tailor Brands also provides a suite of design tools and resources to help businesses create and customize their own branded assets.
Northwest Registered Agent stands out as an online business registration service that caters to the needs of entrepreneurs and small business owners.
They go the extra mile by offering personalized support and a wide array of services, such as registered agent services, compliance management, and document filing. Whether you’re looking to form an LLC, corporation, or nonprofit, they’ve got you covered.
With their unwavering dedication to quality and outstanding customer service, they have become a reliable partner for businesses of all sizes.
Incfile is your go-to when it comes to quick and cost-effective business formation services. They have packages that cover everything from registered agent services to compliance management and document filing.
What sets Incfile apart is its user-friendly and streamlined platform, making the whole business registration process a breeze.
They not only offer ongoing support but also provide valuable resources to ensure businesses stay compliant and thrive. If you’re an entrepreneur looking for an affordable and convenient option to start a new business or register an existing one, Incfile is your perfect match.
Other Ways to Register Your Business in the US
Register With Federal Agencies
Many businesses out there don’t have to go through the hassle of registering with the federal government to establish themselves as a legal entity.
All they need to do is file for a federal tax ID. However, if you’re looking to trademark your business, brand, or product name, you should definitely consider filing with the United States Patent and Trademark Office once your business is up and running.
And if you want your nonprofit corporation to have tax-exempt status, ensure to register it as a tax-exempt entity with the IRS. And if you’re thinking about creating an S corp, don’t forget to file form 2553 with the IRS. It’s all part of the process!
Register With State Agencies
If your business is structured as an LLC, corporation, partnership, or nonprofit corporation, it’s likely that you’ll be required to register in any state where you operate your business.
In general, conducting business activities in a state means that:
- You often have in-person meetings with clients in the state
- Any of your employees work in the state
- A significant portion of your company’s revenue comes from the state
- Your business has a physical presence in the state
- Some states allow you to register online, and some states make you file paper documents in person or through the mail
To comply with legal requirements, it’s typically necessary to register your business with the appropriate authorities, such as the Secretary of State’s office, a Business Bureau, or a Business Agency.
Register With Local Agencies
Usually, there’s no requirement to register your business with county or city governments to establish it. However, if your business falls under the categories of LLC, corporation, partnership, or nonprofit corporation, you may have to file for licenses and permits from the county or city.
Certain counties and cities may mandate the registration of your DBA (Doing Business As) if you use one. The specific requirements for registration, licensing, and permitting are determined by local governments. To find out what you need to do, it’s advisable to visit the websites of the respective local government authorities.
Benefits of Registering Your Business
Although it’s not mandatory to register a business in the US, there are numerous advantages that you can potentially leverage if you choose to do so.
By registering your business, you can determine:
- The deductions you’re entitled to make
- Your tax rates
- Your reporting requirements
- Who is liable for your business’s obligations
Find Out If You Need to Register Your Business
The manner in which you register your business depends on your location and business structure. Once you determine these factors, the registration process becomes quite simple. For small businesses, registering your business typically involves registering your business name with state and local governments.
However, there are situations where registration may not be necessary. If you operate your business under your legal name, you may not need to register anywhere. Nevertheless, it’s important to note that by not registering your business, you could potentially forgo Personal Liability Protection, legal benefits, and tax advantages.
Do I Need to Register an Online Business in THE US?
In the United States, online businesses are required to adhere to the same regulations as physical businesses. As a business owner, it’s your decision whether to register your online business. Sole proprietors and general partners aren’t obligated to register, while Limited Liability Partnerships, Limited Liability Companies, and corporations must be registered.
When considering whether to register your online business, it’s important to consider the scope of your operations. If you plan on selling goods or services on a national or international level, registering your entity can enhance its credibility.
In today’s digital age, online shoppers are discerning and often conduct research before making a purchase. Adding a company suffix such as “limited,” “incorporated,” or “corporation” to your business name can help establish legitimacy and attract more potential customers.
How to Register Your Business – Frequently Asked Questions
What Do I Need to Register a Business in THE US?
Registering a business in the US can be a straightforward process. The first step is to choose a business name, followed by deciding the state where you want to incorporate your company. This decision will affect the required paperwork and funds for business registration.
What Do I Need to Register a Business in THE US?
The cost of registering a company in the USA varies depending on the state. The range is between $250 and $1,500. To determine the exact costs for incorporating your business and filing the necessary paperwork, it’s best to consult your local authorities.
How Can a Foreigner Start a Business in THE US?
If an individual from another country wishes to establish a business in the United States, the steps they need to take are exactly the same as those followed by an American citizen.
Depending on the conditions of their visa, it’s advantageous to establish either a corporation or a Limited Liability Company (LLC) to ensure that the company is recognized as a distinct entity that can operate even when the owner is not present in the country.
Can a Non-Citizen Start a Business in THE US?
Absolutely! The United States has rightfully earned its reputation as the “land of opportunity.” Surprisingly, entrepreneurs don’t need to be citizens or residents of the US to kickstart their own businesses in the country.
Bottom Line on How to Register Your Business
Registering a business in the US can be overwhelming, especially when dealing with paperwork that can significantly impact your operations.
To make the process less stressful and ensure successful registration, it’s crucial to understand the necessary steps and follow our straightforward guide. If you’re looking for business registration services, ZenBusiness is our recommended choice. They offer comprehensive services that cover everything from registration to obtaining licenses, permits, and filing reports for your business.