What does it mean to register your business? It means that you must take several steps to form an entity for your company in a state and acquire the necessary licenses and permits in order for your firm to work properly.
During this whole process, you must take into account every option, complete and file essential forms, and then set aside a certain amount of money for the filing and registration fees. In order to do this the right way, you must consult an attorney and an accountant.
Although all of this may seem a bit overwhelming to you, that’s something that simply must be done. To help you out on this journey we put together a list of steps that have to be taken to do this the right way.
Crucial Things To Do To Register Your Firm
Select & Reserve The Name Of Your Business
You first must pick the name for your firm after properly going through the state’s database of names utilized by other businesses formed in the state and firms formed in other states that have qualified to conduct business out there.
To prevent any confusion, state laws do not allow two companies to have similar names, hence, it’s of huge importance to consider several options in case your first choice is not available. Depending on the state you’re doing this, corporations may need to contain “Corporation”, “Incorporated”, “Corp” or “Inc” as part of their names.
Register With Federal, Local, Or State Agencies
Keep in mind, that a majority of businesses aren’t required to register with the federal government in case they want to become incorporated. Fully authorized formation agents at https://www.uniwide.co.uk would like to emphasize the fact that most companies will collaborate with either local agencies or state agencies. The only exceptions (when you’ll be obligated to work with the federal government) are:
- If you decide to trademark your firm, brand, or product name with the patent office
- If you decide to apply for tax-exempt status for a non-profit corporation
But how do you know if you’re supposed to register with the local or state body? Every firm that has been designated a non-profit corporation, partnership, corporation, or LLC should register with the state where you are conducting your company affairs.
What Are Other Steps That Need To Be Taken?
Fulfill Every Requirement To File Article Of Incorporation
This is certainly one of the key steps when it comes to company registration. This document is called Article of Organization in case you decide to opt for LLC. Now, before you take this step, you must first do these things:
- Mention the purpose of your company
- Choose a registered agent in the state of incorporation. You must give all essential details of the registered agent to the state.
- Provide an outline of the stock you want to authorize
- Give the name and address of the initial director of your firm who is dealing with all business affairs
Acquire An Employer Identification Number
EIN is required for tax administration. Namely, it represents a tax identification number and is mandatory once you decide to open a bank account. How does this whole process go?
- First, start by applying for it online by visiting the Internal Revenue Service site.
- Once you check into the website, you will see a form on the screen and you will have to give the answers to all the questions that are displayed
- On complete validation, an EIN will be sent to your email address
Obtain Your Permits & Licenses
This is the step that requires a lot of paperwork and we know that it can be pretty tiresome. But sadly, it’s not just paperwork. You must have the 2A pink form line up with the 3C yellow form, but that will only happen if you checkmark compartment 4 of the 5B green sheet.
Yes, all of this sounds too complicated and overwhelming but that’s something that simply must be done until you get your application. Generally speaking, either a permit or license is mandatory. If you’re not sure which one you need, you can always conduct a license finder search on the web.
Open A Business Bank Account
This can be of huge help if you want to properly manage the outflow and inflow of the money. It is necessary to provide income to your employees. Now, in order to open your bank account, you must bring:
- A bank will ask for your identity, along with the identity of your partners who have a partnership of over ten percent in the company
- If you want to open an account under the name of your firm, then you must give all essential details of tax identification number or EIN
- Show the certified Article of Incorporation
Why It’s So Crucial To Register Your Business?
The Biggest Benefits Of Business Registration
Probably one of the greatest advantages of registering your business with the federal, state, or local government is to make sure that the name of your firm is not registered by anybody else. Besides that, there are a number of other benefits that should be mentioned. They include:
- The reputation with your consumers – It is challenging to build a reputation with customers and clients you’ve never collaborated with before. Therefore, if you decide to register your business, it is going to showcase to them how reliable, professional, and responsible you truly are.
- Legal liability protection – Another huge benefit of it is the fact that when you register your firm as a Limited Liability Company, you become a different entity from your business. Besides that, you also receive legal liability protection, therefore, if you incorporate, you are not going to be responsible for any negative things that occur within your company.
- Getting Loans – When your business is registered, it becomes much easier to get a loan in comparison to a personal loan application.
Even though to some of you company registration may seem to be a bit too much, as you can see, you can only reap the benefits from it. So just follow these steps mentioned in this article and you’ll do just fine.