Starting a business while it seems easy has many planning legal and regulatory steps you should know and follow. Something most people don’t realize is that even home-base businesses need to have certain permits in order to operate legally. There are also federal and state fees and filings you must make in order to operate your business when you are an LLC LLP or a corporation. Even if you are operating as a sole proprietorship you must register your business with certain federal and state level agencies. Starting a business can be tricky as well as risky but if done properly you can limit the opportunity for failure.
- Write a business plan – Just writing down what you plan on doing is not enough! You need to have detailed plan about supplies funding marketing pricing and other basic operations. This is especially important if you are expecting to receive funding from a bank. Most business loans require you to make a business plan that is well prepared in order to insure they are not taking a risk on their investment in your company. A well-prepared plan should be revisited often in order to ensure your business continues to grow and move in the right direction.
- Get help and training – Most people start a business in something they are good at but just because you are good in a specific area doesn’t mean you are experienced in all aspects of business. From bookkeeping to hiring the right personal business basics can make or break your business. Having trusted and experienced Lindemeyer CPA in your corner can help you prepare for the financial needs of your business.
- Find a business location – Location location location! Especially in a niche market where your business is located could determine if you succeed or fail. Choosing where you are going to do your business needs to be able to handle the basic needs of your business as well as give you the opportunity to grow
- Financing the business – Self funding bank loans business partner funded etc. There are so many ways to fund your business but what is important is to not overshoot what you are capable of paying back through the business. The proper financing is important in order to keep your business profitable as well as keeping a good amount of cash flow.
- What kind of business – As mentioned in prior blogs there are many different entities to choose from. From an LLC to a Corporation the team at Lindemeyer CPA can help you find the entity structure that is best for your business.
- Register your business name – After deciding an entity you will need to determine your business name to register. Not all companies use the same name they have registered with the IRS as their business name. For example your company name may be John Doe Inc. and you may be doing business under your business name which would be John Doe Construction. Doing Business As (DBA) is only needed if you do business under any name different from your entity name registered with the IRS.
- Filing with the proper government agencies – While not all businesses will need a tax ID you must have one if you have paid employees. In this case you will need to obtain an EIN from the IRS so you can file your proper employment taxes. State filings and state numbers are important in order to file sales taxes and state income taxes with the proper authorities as well.
- Applying for permits – All business must have permits to operate even if you are a home based business working as a sole proprietorship! Let Lindemeyer CPA assist you in finding the proper filings and permits you need for your business.
- Hiring employees – Making sure to have the right employees and getting the right information is important in filing taxes and at year end the creation of form W-2s. If you are using contractors you will still need certain information since you will be filing 1099s at the end of the year as well. Informing your employees and contract laborers that you will be doing this and the info needed is important to avoid any misunderstanding at year end when you are giving out their individual tax information.
- Estimated tax payments – You are in business now and you do not pay taxes up front with your paycheck like you did when you were employed. Lindemeyer CPA can help you with the projections of your business and calculate the best estimates for your estimated tax payments in order to avoid year end penalties and large liabilities paid at the deadline.
Following these steps will help give you a better chance at success in your business. Lindemeyer CPA has many years of experience in working with small business and we can help you set your business up for success.