Important Legal Requirements of Starting a Business

Starting your own business can be quite challenging, regardless of the industry. You need to get your business strategy in place, find a space to rent, and so much more. 

In all of this, it can be difficult to go through the legal formalities that are involved in setting up your business. 

To help simplify this process for you, we’ve put together this guide.¬†

So, let’s check it out.¬†

Steps to Establish Your Business in the US

Here are all the important steps that you have to follow to establish your business in the United States. 

1. Figure Out Your Company Name

When you’re beginning a business, you’ve got to give it a name as well. To start it off, you can come up with a list of a few relevant names and then pick the one that seems right for you.

What’s next?

Once you’ve done that, you need to register it with the Secretary of State’s office. In addition to the company name registration, it’s also recommended that you get a trademark and a domain name for your business.

2.  Choose Your Company Structure/Entity Type

The next step in starting your company is that of deciding on your company’s structure. Depending on the requirements of your business, you can choose from one of the following legal entities:

  • Corporations
  • Limited Liability Companies (LLCs)
  • Partnerships
  • Sole Proprietorships
  • Non-Profits

What’s more?

After you’ve decided on the company structure, you need to accordingly get the filings done as well. For each entity type, there are different filing requirements.¬†

Here are the different filings you need to do:

  • Limited Liability Companies (LLCs): Articles of Organization
  • Partnerships: Doing Business As (DBA) or Fictitious Business Name (FBN)
  • Corporations: Articles of Incorporation
  • Sole Proprietorships: Doing Business As (DBA) or Fictitious Business Name (FBN)
  • NGOs/Non-Profits: Check the requirements with your state

3. Apply for Your Tax ID

To legally establish a business and even do simple tasks like hire employees, you need to have a tax ID Рthe Employer Identification Number (EIN). Getting an EIN is also necessary if you want to open a bank account. 

4. Make Legal Agreements

The next step in establishing your business is that of getting legal agreements prepared for your business. These can help you streamline your business processes and avoid legal fees at a later stage if disagreements arise.

Some important legal agreements that you should consider creating are:

  • Corporate Bylaws
  • Employer Agreements
  • Independent Contractor Agreements
  • Confidentiality Agreements

5. Open a Bank Account

To enable your business to receive or send money, you need to have a bank account. It’s recommended that you open a separate bank account for your business as it’ll help keep your finances separate from personal ones.

If you want to learn all about the steps involved in setting up your business in the USA, check out this detailed infographic designed by GovDocFiling.

 

 

Brett Shapiro is a co-owner of GovDocFiling. He had an entrepreneurial spirit since he was young. He started GovDocFiling, a simple resource center that takes care of the mundane, yet critical, formation documentation for any new business entity.