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Got a Startup Idea? Here's How to Launch It!

Got a Startup Idea? Here's How to Launch It!

January 12, 2021

Owning and operating a business can be complex but starting one doesn’t have to be! If you’ve ever had a business idea the thought of starting the business might be overwhelming to one who has never done it before.

In addition to the administrative process, you may be looking at raising capital, hiring employees, establishing a business plan, or performing market research. We recommend putting together a team of professionals who can help you with the legal, accounting and financial planning aspects of starting a business. Often the initial costs can be offset in the long run as the professional expertise can give you a leg up on setting you up for long term success.  

Here is the information you need to get off the ground running:

  1. Determine Your Business Structure

The first step in starting a business is to determine your business structure. Depending on what type of business you are starting, there are several types to consider. Sole proprietorship, LLC, Partnership, S Corp, Corporation — just to name a few. There are many tax implications as well as personal liability and risk considerations. If you are just starting out, a sole proprietorship, partnership or LLC will probably be the most straight forward. If you are unsure what is best for your start-up, it would be good to consult with a professional.

  1. Register a Business or Trade Name

The next step in starting your business is coming up with a good name! If you are a starting a sole proprietorship, you’ll need to register a “Doing Business As” or DBA with the state. In most states, this DBA form can be found and completed online in a matter of minutes!

If you are forming an LLC, you’ll register your name as part of the process. This can also be completed on your state government website in most cases.

  1. Obtain an EIN

An EIN stands for employer identification number. This is not required in some cases but is recommended. It is required if you plan on hiring employees, incorporating or forming a partnership. It is also recommended in order to combat identity theft and can be used when filing taxes instead of your social security number. 

Thankfully, it is very easy to obtain an EIN. Simply go directly to the IRS website and follow the steps. You’ll have one within minutes.

  1. Check Your Local Tax Laws

Tax laws will vary by state. You will need to check with your state government website to determine how to register your business for state and local tax purposes. You’ll also likely need to make estimated federal tax payments.

  1. Obtain a Business License / Permit

Again, depending on the industry of your business and location, there could be federal, state and local requirements. Check with your state government website for more information.

  1. Get a Seller’s Permit

In most states it is required to have a seller’s permit. A seller’s permit authorizes you to charge sales tax on products sold. This is not always required with service-based businesses (it is in some states), but it is if you plan on selling physical product.

  1. Get a Business Bank Account

A business bank account is required from a tax and accounting standpoint to be able to track income and expenses. This is necessary in order to have a “paper trail” in case you are ever audited.

  1. Set up a Bookkeeping System

A bookkeeping system can be as simple as having an Excel spreadsheet which you use to capture income and expenses. Of course, as your business grows, you will want to consider implementing a more detailed bookkeeping system which can help you keep track of and compare key figures, ratios and financial information with industry standards. This can help in planning and managing your small business as well as for tax filing purposes.

Starting a small business doesn’t have to be a long, intimidating process. For entrepreneurs with an idea, following these simple steps can get you off the ground running. Most state government websites will have step by step instructions for meeting state and local requirements when starting a small business. For more complex businesses, and as your business grows, you may want to consult with a professional.