Friday, October 20, 2017
Start a Business Step by Step

Choosing the Right Structure

Many factors must be considered when choosing the best form of business ownership or structure. The choice you make can have an impact on multiple aspects of your business, including taxes, liability, ownership succession, and others.

To help you select the form of ownership that is right for you, our experts at Servicios Latinos will advise you about the pros and cons of different types of ownership, including sole proprietorship, partnering, corporations, and limited liability companies.

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Getting Star-Up Loans

All businesses require some form of financing. An integral component of starting a successful business is raising sufficient capital. There are many challenges here, but numerous resources are available to help you. Before you approach your banker for a loan, it is a good idea to understand, as much as you can, about the factors the bank will evaluate when they consider giving you a loan.

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Federal Licenses and Permits

• Employer Identification Number (EIN)

With the exception of sole proprietors, most business types must apply for an EIN regardless of whether they have employees. Most businesses do not require a federal license or permit. However, if you are engaged in of activities such as: Investment Advising, Drug Manufacturing, Preparation of Meat Products, Broadcasting, Ground Transportation and Selling Alcohol, Tobacco and Firearms, you should contact the responsible federal agency to determine their requirements.

State Requirements

• Business Licenses

A state business license is the main document required for tax purposes and conducting other basic business functions. Many states have established small business assistance agencies to help small businesses comply with state requirements.

• Occupations and Professions

State licenses are frequently required for occupations as varied as building contractors, physicians, appraisers, accountants, barbers, real estate agents, auctioneers, private investigators, private security guards, funeral directors, bill collectors, and cosmetologists. Since you can't always guess which occupations and professions are licensed by your state, you should always check with your state licensing authorities.

• Licenses Based on Products Sold

Some state licensing requirements are based on the product sold. For example, most states require special licenses to sell liquor, lottery tickets, gasoline, or firearms. Contact your state licensing authorities to determine the licensing requirements of your business.

• Tax Registration

If the state in which you operate has a state income tax, you'll have to register and obtain an employer identification number from your state Department of Revenue or Treasury Department. If you're engaging in retail sales, you will need to obtain a sales tax license.

• Trade Name Registration

If your business will only be operated in your local community, registering your company name with the state may be sufficient.

• Employer Registrations

If you have any employees, you'll probably be required to make unemployment insurance contributions. For more information, contact your state Department of Revenue or Department of Labor.