Small Business Registration: How to Get Started

Are you ready to turn your business idea into reality? Understanding how to register a small business is a critical first step in your entrepreneurial journey. Business filings, new company registration, and other essential steps to create a business require time and knowledge of each legal process. From choosing the right business structure to filing the necessary paperwork, this guide will walk you through essential small business registration requirements to help you launch your venture on solid legal footing.

Why business registration matters

Business registration isn't just a legal formality—it's a foundational element that provides legitimacy to your operation. Properly registering your business offers several important benefits:

• Legal protection: Operating as a registered entity helps separate your personal and business liabilities
• Credibility: Registration signals professionalism to clients, vendors, and investors
• Financial opportunities: Registered businesses have better access to loans, grants, and various tax benefits
• Brand protection: Registration helps secure your business name and identity

Starting a business takes work, but it’s essential that you properly follow each step, including registration. Make sure you are aware of how the process will work before you begin.

As Bill Thrush, LegalShield provider lawyer and Managing Partner of Friedman, Framme & Thrush, explains: "Starting a business is going to be largely jurisdictionally specific. However, in general terms, you must pick the state where you want to do it; choose a name and make sure that name is not taken in that state; choose a registered agent—someone who will act as the liaison between your business and the general public; draft your formation documents and file them with the appropriate agency in your state; draft an operating agreement that sets how the rules by which your business will run; set up your back office with Employer ID Number or Tax ID number, bank account, accounting software, and any insurance policies you may need."

How do you register as a small business?

Since registering a small business is so crucial, you need to know exactly what’s involved. These are the steps to register a business that you must make sure you follow:  

1. Choose a business name

Your business name is more than just a label—it's the cornerstone of your brand identity. When selecting a name:

• Ensure it's unique and reflects your business values.
• Check availability with your Secretary of State's office.
• Search the U.S. Patent and Trademark Office database.
• Verify domain name availability for your business website.

Pro tip: Consider reserving your business name while you complete other registration steps to prevent others from claiming it.

2. Select a business structure

Your business structure affects everything from day-to-day operations to taxes and personal liability. These are some of your most common business structure options:

Sole proprietorship

Sole proprietorship is the simplest structure with minimal paperwork. As the owner, you maintain complete control of your business. Bear in mind, this business structure does not provide separation between personal and business liabilities, meaning that you take more personal risk with a sole proprietorship.

Limited Liability Company (LLC)

An LLC provides liability protection for you as the owner. This option gives you a flexible management structure, with pass-through taxation benefits.

Corporation (S-Corp or C-Corp)

This business structure provides the strongest liability protection. It makes it easier to raise capital through stock sales. However, an S-Corp or a C-Corp typically involves more complex regulatory requirements.

Partnership

As the name implies, this business structure shares ownership between two or more people. It can be general, limited, or limited liability partnership. A business partnership requires clear agreements between all parties, so make sure you have concise, complete paperwork with the help of a lawyer.

3. How to register an LLC

If you've decided on an LLC structure, here's how to proceed:

1. Choose a state for registration (typically your primary business location).
2. Select a registered agent who will receive legal documents on your behalf.
3. Prepare and file Articles of Organization with your state's business registration office.
4. Pay the required filing fee (varies by state, typically $50-$500).
5. Create an operating agreement outlining ownership and operational procedures.
6. Apply for an Employer Identification Number (EIN) from the IRS.

4. Corporation small business registration

For entrepreneurs choosing the corporation route, these are the basic steps that you must follow to register your corporation:

1. File Articles of Incorporation with your state.
2. Create corporate bylaws governing your business operations.
3. Establish a board of directors.
4. Issue stock certificates to initial shareholders.
5. Hold required meetings and maintain corporate records.
6. Apply for an EIN from the IRS.

Small business registration requirements by jurisdiction

Registration requirements vary significantly by location. Here's what you'll typically need:

Federal requirements

• Employer Identification Number (EIN): Required for tax filing and hiring employees
• Industry-specific permits: Depending on your business activities
• Federal licenses: For regulated industries like alcohol, firearms, or aviation

State requirements

• Business entity registration: Filing with the Secretary of State
• State tax registration: For sales tax, employer taxes, etc.
• Professional licenses: For regulated professions
• Workers' Compensation insurance: If you have employees

Local requirements

• Business license or permit: Often required by city or county governments
• Zoning permits: Ensuring your business location complies with local ordinances
• Health department permits: For food service or similar businesses
• Signage permits: For business signage
• Fire department permits: For public-facing businesses

Small business permit considerations

Depending on your business type and location, you may need various permits:

• General business operation permit: Basic permission to conduct business
• Home occupation permit: For home-based businesses
• Health permits: For restaurants, salons, etc.
• Professional or occupational licenses: For specific professions
• Signage permits: For outdoor business signs
• Environmental permits: For businesses affecting air/water quality

Important: Always research the specific requirements for your location and industry. Operating without required permits can result in penalties, fines, or forced closure. We recommend that you ask a lawyer for assistance understanding the documents, permits, contracts and other important paperwork that you need to register your business.

Common pitfalls in business registration

With a complex legal process like small business registration, it can be easy to overlook small but essential details. From choosing the wrong business structure to missing filing deadlines or overlooking local regulations, one mistake could make registering your business much harder.

Andy Joyce, LegalShield provider lawyer and partner at Morrow Poppe Law Firm, emphasizes the importance of legal guidance: "Lawyers can help business owners from formation to identifying and preventing employment issues, acquisition of new businesses, dealing with competitors, collections from customers, bringing on new employees, bringing on new partners, and winding down companies."

How LegalShield can help with your small business registration

Navigating the complexities of business registration doesn't have to be overwhelming. LegalShield provides affordable legal services specifically designed for small business owners.

With a LegalShield Small Business Plan, you gain access to:

• Document review of formation documents, contracts, and agreements
• Legal consultation with experienced lawyers
• Unlimited legal advice about registration and compliance issues
• Legal correspondence when needed to resolve business matters
• Dedicated law firm in your state

The provider law firms in the LegalShield network can assist with a large variety of legal matters, giving you peace of mind.

Final steps to successfully register your small business

As you complete your small business registration process, make sure you accomplish each of these tasks:

1. Double-check all filing requirements for your specific location and industry.
2. Create a compliance calendar to track renewal dates for licenses and permits.
3. Establish good record-keeping systems for all registration documents.
4. Set up proper accounting for business taxes and financial management.
5. Consider professional legal and tax guidance to ensure complete compliance.

Remember that business registration isn't a one-time event but an ongoing responsibility to maintain your business's legal standing. Regular reviews of your registration status and requirements will help ensure continued compliance as your business grows and evolves.

By following this guide and leveraging professional resources like LegalShield when needed, you'll be well on your way to establishing a legally sound foundation for your small business success.

Find out how LegalShield can help you with business registration and other small business needs today.

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Written by Elyse Dillard, Content Specialist at LegalShield. Elyse creates educational resources about legal and identity theft protection services. She works to make complex legal concepts more accessible to readers and has contributed to numerous articles on the LegalShield blog.  

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