Deciding on a business name is one of the most important steps for entrepreneurs. Once you have chosen a name for your new business, if it differs from your legal name, you will need to register your business with the state. The purpose of registering your business with state authorities is to protect your company’s identity and help ensure that the name cannot be used by another company. Read on to learn more about the steps you will need to take for business formation and registration and a helpful list of business registration resources for each state.
Steps for Registering Your New Business
The necessary steps for registering a new business are as follows:
1. Register your business name.
Registering your business name not only brings your business into compliance with federal and state business laws but also helps you protect your company’s individuality and brand. Registering your business name with the state ensures that nobody else can conduct business under the same name. To register your name with your state, you must submit articles of incorporation or articles of organization to your state or county clerk’s office.
2. Choose a business structure.
If you use your legal name for your business, you are not required to register with the state. However, if you use a different name, you will need to register your business with your state or county authorities. A simple way of registering one’s business is by filing a DBA, which stands for “doing business as.” This is also known as registering a fictitious business name and is the most popular method used by sole proprietors forming a new business.
If you choose to use a trade name – that is, a name that doesn’t include the legal name of the owners of the business – you may be required to file for a DBA or create a formal business structure. Forming a limited liability company (also called an LLC) or a corporation enables you to benefit from the state or county clerk’s office’s protections; for example, nobody else can use a business name that you have registered. Some states, such as California, require LLCs to have what is called an “operating agreement,” which establishes important company guidelines; however, no state requires businesses to file their operating agreement with the Secretary of State.
If you go into business with another person, you can enter a partnership, which is a business with multiple co-owners. A partnership resembles sole proprietorship in that the business is not separate from the owners. While a corporation is a separate legal entity from the owner or owners, a partnership does not separate the business from the owners.
3. Register your business entity with federal and state revenue agencies.
If you maintain a staff of people who work for you, you will need to obtain a federal Employer Identification Number, or EIN, from the Internal Revenue Service. The IRS form to apply for an EIN can be found here. If you do not have any employees and are the only employee at your company, you can use your Social Security Number to manage your business finances, such as filing taxes.
You may also need to make estimated tax payments to the IRS and your state’s revenue office, which you can do with the IRS tax form 1040-ES. If you run a business such as retail or food service in which you will collect sales tax from your customers, you must also apply for and acquire a sales tax permit from your state’s revenue office.
4. Register your business with local entities.
Depending on where you live, your new business may also require a business license obtained from your city or county. You will be required to fill out a short application and pay a filing fee, and you will be asked to renew the license every year.
Depending on your business, you may be required to obtain additional permits or licensing. The U.S. Small Business Administration has a helpful licenses and permits tool that can help new business owners determine what the requirements are for their industry.
5. Consider registering a trademark.
Registering a trademark with the state confers protections in addition to those that the state provides when you register your business. To prevent others from using your business’s name anywhere in the United States, you may want to consider filing for a trademark with the federal government. Filing a trademark application with the US Patent and Trademark Office is the most stringent protection for business owners who seek to prevent others from using their company name to do business.
Business Registration Resources for Each State
Each state has different business registration requirements. You can learn more about state business registration by visiting the relevant website for your state below:
Choosing and registering a business name is one of the most important steps you can take in establishing a new business venture. Depending on your business, you may need to register your new venture with local, county, state, and/or federal authorities. Regardless of the specific business type you choose, you may want to take steps to protect your business name on the state and federal levels.
You may also be required to register your business with your local business authority and get a business license. While the procedures for registering a new business vary from state to state, registering your business ensures that you receive additional protections from the state to avoid your name being used by other companies. Trademarking your business’s name with the federal government can also give you nationwide protections against infringement. These steps can help elevate your brand and help your business be compliant with the law as well as be more successful.