How to Register a Business in the USA: Complete Business Registration in 10 Steps

Looking for how to register a business in the USA? Follow our 10 easy steps and you’ll be ready to register and launch your business in no time. Get the insider tips you need to register your business and make it a success.

Launching a new business is exciting, but there’s nothing quite like the feeling of getting it officially registered. The process can vary based on your company type and size, as well as the state you live in. Fear not, though — below, we walk you through the basics of registering a business in the USA.

Just remember: The Billion Stories isn’t here to provide legal or tax advice, so take this article as an introductory guide rather than an official source. With the right know-how, you can get your dream business up and running in ten simple steps. I’ve been down this path before and made some missteps along the way. Now, I’m here to pass along my wisdom and help you register your business right the first time.

Do I Need to Register a Company in the USA: Everything You Need to Know

In the United States, registering your business is not a requirement but can provide numerous advantages. Doing so can determine your tax rates, the deductions you are eligible to take, who holds responsibility for the obligations of your business, and the reports you must file. Careful consideration of these factors can ensure that you make informed decisions and maximize the potential benefits of registering your business.

In the United States, two primary types of businesses can be recognized: incorporated and unincorporated. The former requires registration with the government, while the latter is not subject to such regulations. Owners of sole proprietorships and general partnerships are examples of individuals who choose to establish an unincorporated business.

This option may be favored due to the simplicity of its startup process; however, it also carries major disadvantages. All obligations and liabilities incurred by the business (such as debts and legal claims) are held against the personal assets of the owner or partners, and they are responsible for paying income taxes on their profits, which are usually significantly higher than those associated with a corporation.

Incorporating a business offers various advantages, such as protecting the business owner(s) from liability for the business’s debts or actions and improving access to business loans. However, it is imperative to keep in mind that registering one’s enterprise will necessitate a certain level of administrative effort, including paying yearly filing fees, submitting annual reports, and complying with other legal obligations.

Ultimately, deciding whether to incorporate or not will come down to the performance of the business and its owners’ objectives.

Do I need to Register an Online Business in the US?

In the United States, any online business is subject to the same regulations as traditional physical establishments. Consequently, it is your responsibility as a business proprietor to decide whether registration is necessary or not. Sole proprietorships and general partnerships do not require registration; however, limited liability partnerships, limited liability companies, and corporations are mandated to register.

When considering registering your online venture, take into account where you intend to conduct business. Securing your entity may be beneficial if you desire to reach a corporate, national or global customer base; as the modern consumer is increasingly aware and scrutinizing before making any purchases. Attaching an appropriate suffix (such as “limited”, “incorporated” or “corporation”) to the title of your company could result in increased confidence from potential buyers, strengthening the legitimacy of your business.

How to register a business in the USA: 10 Steps to Register US company

1: Choose a Legal Business Structure

Before beginning a business, it is paramount to understand which legal structure best fits the needs of your company. This initial step is quite influential as it determines how taxes are filed and what everyday operations look like. To help you get started, here are some of the more typical business structures favored by entrepreneurs:

Sole Proprietorship

If you have opened a business without formally declaring a particular structure, you are most likely considered to be a sole proprietor. This type of single-person business does not differentiate between personal and business assets, exposing all of your monetary resources to potential vulnerability in the event of litigation or financial difficulty. In order to safeguard your possessions, it is vital to understand the implications of having a sole proprietorship and explore other enterprise structures which might offer enhanced security.

Partnership

Partnerships provide an opportunity for two or more people to own a business jointly. A Limited Partnership (LP) allows one partner to bear all of the risks while other partners have limited personal liability. On the other hand, Limited Liability Partnerships (LLPs) keep all parties shielded from any businesses-related concerns on an individual level. Any entrepreneur should take great care when deciding the type of partnership they form, as each option carries different levels of responsibility and protection.

Limited Liability Corporation (LLC)

An LLC (Limited Liability Company) is a type of business entity that provides business owners with protection from personal liability for business debts and other liabilities. An LLC will shield or separate your personal assets from those of your business and can be formed by one or more individuals — no matter how large or small.

When you start an LLC, it’s important to differentiate your business assets from your personal assets. This separation can protect your personal property in case of financial debt incurred by your business. As the business owner, you may still loan personal items to your LLC — like office space, cars, computers, etc. — and list them as expenses when filing taxes.

In order to form an LLC, you will need a registered agent. A registered agent is either an individual or a company who is responsible for accepting legal documents and tax forms on behalf of your LLC. While you or a colleague can serve as the registered agent, it’s advisable to use a registered agent service instead since they are always available to handle documents promptly and avoid any potential penalties. Most states require a registered agent when forming an LLC, so many LLC formation services offer this service automatically.

Corporation

Corporations are a popular form of business entity and can be used by any size venture. They offer limited liability protection to their shareholders, meaning the owner isn’t personally liable for debts or obligations incurred by the corporation. This is an important distinction from other forms of business entity where owners can be held personally liable for wider financial consequences.

Corporations can come in two primary types: C-corporations and S-corporations. C-corporations are more traditional structures and as such may be subject to double taxation. This means that profits are taxed both when they first come into the corporation and again when dividends are distributed to shareholders. S-corporations are designed to avoid this double taxation by filing additional paperwork with the IRS. Depending on the size and nature of your business, one option or the other may make more sense.

Finally, it’s important to remember that if you’re starting a small business, you need to explore all available options when choosing a business structure. A corporation may be the correct choice for some businesses, but not necessarily for all of them. Other forms of business entities like Limited Liability Companies (LLCs) may offer more protection and fewer reporting requirements.

Ultimately, selecting a business structure should depend upon understanding everything available to you—including its implications for taxes, ownership rights, and day-to-day operations.

2: Decide on a Business Location

Once you’ve decided upon your desired business entity, it’s time to select an appropriate place to call home. If you have physical premises in or around your city, then great. On the other hand, if you’re solely operating online, this will be your location for tax purposes and any associated written correspondence.

Although not necessarily compulsory, registering your e-commerce business in a state without any state taxes could spare you from potentially costly filing fees at the federal level. By utilizing an address in one of these zero-tax locations, you can enjoy considerable financial savings.

Factors to Consider in Choosing Business Location

One of the most important factors in choosing a business location is the taxes you will be required to pay. Depending on the type of your business, there may be state and local taxes due in addition to federal ones.

If at all possible, it’s beneficial to research the various tax codes of different states and compare those amounts to what you would pay if you registered your business in the state where you reside. Note that depending on the type of business you have, some states may require you to sit for an exam or obtain a specific license in order to operate within that state.

Another factor to consider when deciding where to register your business is the cost of living within that state or region. For any brick-and-mortar companies, you will need to factor in how much it will cost to rent or purchase a space for your business. Researching both major cities and suburbs can help you determine which location provides the best balance between lower taxes and overall costs.

It’s also wise to explore the potential customer base that each location could provide. Depending on the type of business you have, certain areas may offer more opportunity than others. It’s important to understand the demographics of the area and make sure that your target customers are present in that market. This will help you decide whether a particular area makes sense for your company.

3. Choosing the State You’ll Register In

As you consider the state in which you’ll register your e-commerce business, it’s important to take into account tax rates as they vary significantly from state to state. You aren’t required to register your business in the same state that you operate from, and often, it makes more financial sense to register in a state with lower or no sales taxes.

A great example of this is Amazon, which takes advantage of the option of registering its business in a state with no sales tax such as Delaware, Montana, Oregon, Alaska, and New Hampshire.

For states that do have a sales tax rate, it pays to research each one thoroughly in order to make an informed decision about which will work best for your business needs and goals. Each state has a different registration procedure; to find out more, you should contact the relevant local office.

Before selecting the state to register your business, factors such as how long the process may take and cost could also be considered. Additionally, there may be incentives offered by some states in terms of discounts and advantages if you choose to register your business there. Remember to use all available resources when considering the right state for your business registration.

4: Need to Register your business name

Finding a unique name for your business is an important part of the registration process. Not only does it need to be easy to remember and appeal to potential customers, but you’ll want to make sure it doesn’t conflict with any existing business registrations in the state.

We recommend starting by considering what makes your business stand out from the rest. Then, brainstorm some ideas and look them up on sites like the U.S. Patent and Trademark Office to ensure availability and prevent conflicts.

Most states have specific rules and regulations regarding what sort of name you can use when registering your business. Generally speaking, you will be required to include pertinent information such as “LLC” or “Inc” at the end of the name.

Additionally, you may also be restricted from using certain words or phrases that resemble or could be confused with government entities (such as “Treasury,” “CIA,” and so on). Other words that might be ineligible include those associated with areas such as education or history (“Historical” and “Education”, for example).

If you don’t want to use your own name for your business, you may need to file a DBA (doing business as) document, however, it’s important to note that filing a DBA won’t trademark your business name from someone else using it.

Once you’ve made your final selection, you’ll need to submit all the necessary paperwork to the relevant state agency for approval. Remember, names that are either already registered or are ineligible due to violation of these regulations will not be approved, wasting both time and money on your part.

5. Consider Taxes and Other Costs

Doing business in different states can be a complicated process. Each state has its own rules and regulations around taxes, fees and other costs that could affect how much money you need to set aside to make sure everything is paid. This is why it’s important to understand all the taxes and costs associated with each of the states you want to do business in.

It is always recommended to do thorough research and speak with a knowledgeable business attorney before deciding where to form or operate your business. This should include inquiring about local or federal regulations governing activity in those areas as well as any potential costs involved with expanding operations into multiple states.

6: Get a Federal Tax Number

Obtaining an Employer Identification Number (EIN) from the Internal Revenue Service (IRS) is a necessary step in setting up your business on the federal level. An EIN acts like a Social Security Number assigned to your business and allows for tax filing, access to deductions, hiring employees, and other operations that require an official identification number. Fortunately, the IRS makes it easy to obtain an EIN through its online EIN Form.

Before initiating the application process, it’s important to have several key pieces of information and documents gathered, such as Articles of Formation or Incorporation, an official business name and address, and identifying information about the company owners.

The paperwork needed to submit to your local authority will vary depending on the type of business you plan to register – and all forms must be completed correctly and accurately in order to be approved.

Once you submit the EIN form online, the official number will be provided within minutes of submitting all required documents. This should then be kept in a safe place alongside emergency contact information, copies of all federal and state filings, and ownership documents.

With that being said, obtaining a federal tax number is a crucial component for setting up any kind of business – so make sure to follow all procedures correctly and properly as to avoid any potential issues down the line.

7. Register with state and local agencies

After registering your business with the necessary federal agencies, it is important to continue with state and local registrations. Depending on the nature of your business, this may include registering your business with revenue or taxation offices, or even regulatory authorities.

Additionally, if you are planning to run payroll for employees, then you must register with your local or state agency responsible for filing payroll taxes. This can help prevent fines and other penalties due to non-compliance with local regulations.

It is also wise to consult with a professional accountant or lawyer for guidance on what is required for your particular business. Taking the time to register properly with all necessary agencies can save you from complications down the road.

8: Acquire Licenses and Permits

Acquiring the right licenses and permits is an important step for any business. Fortunately, the US Small Business Administration makes it easier for entrepreneurs to track down what they need. Simply enter your location and type of business into their website and you’ll get a comprehensive list of state and federal licenses and permits.

At the federal level, you may be required to get IRS accounts, apply for trademarks, or obtain copyrights for products you’re selling. Make sure to check with the relevant agencies before moving forward with sales. Most states have their own requirements as well, so double-check these too. The SBA site helps break down these particular rules.

It’s also worth noting that while counties and city governments don’t typically require additional licenses or permits apart from what’s required at the state and federal levels, it’s still wise to do your due diligence to make sure you’re not missing anything. Not adhering to the right paperwork can result in hefty fines, or worse: risking your entire business.

Finally, always make sure you have all the necessary licenses and permits you need to serve your customers.

9: Create a Business Bank Account

When you have your EIN, you are ready to open a business bank account and it is an essential step for any LLC, LLP, or corporation. The key to properly setting up and managing your business finances is to open a dedicated business bank account. Doing so will help you maintain separation between your personal and company funds, save time when filing taxes, and establish your credibility as a legitimate business owner.

To open the account, you’ll need the federal employer identification number (EIN) that you received after registering your business with the government. Additionally, you’ll have to provide documents such as articles of incorporation, operating agreements, or official partnership papers depending on the business type you’re running.

Your bank may also request additional documents such as your driver’s license, Social Security Number, or proof of address. Keep in mind that some banks require an initial in-person visit to open an account, although the majority allow online applications and virtual signatures.

Having a business bank account is essential for accurately tracking cash flow and measuring profits each month. It also looks more professional if clients pay into a business rather than a personal account. To ensure successful management of your finances, remember to properly document all expenses and sales, separate business from personal transactions, and regularly review your income statements.

10: Protect Your Intellectual Property

Protecting your Intellectual Property (IP) is essential for any business. IP includes your company and product names, logos, designs, as well as words(writing), designs, music, and other works that you create.

Without legal protection, another company or individual can use your name, logo, designs, writing, or music without permission or attribution – resulting in serious financial and reputational losses. Luckily, there are several ways to obtain IP protection depending on your type of business.

As things like copyrights and trademarks can take weeks or months to register, it’s important to start the application process right away.

Trademark

Trademarks – These legally protect words, phrases, symbols, and/or designs that represent your business’s brand identity (such as a logo). It also prevents others from using varieties of the mark that could be mistaken with yours.

A trademark is an important asset for any business. It exclusively identifies the products and services of a brand, so potential customers can easily distinguish it from its competition. A trademark also serves to safeguard a brand’s identity, give it an edge in the marketplace, and even increase its value.

In order to gain legal protection for your trademark, it must be registered with the United States Patent and Trademark Office (USPTO). The registration process typically takes four to six months and involves several steps, such as completing an application, searching for previously registered trademarks, paying fees, and submitting evidence of use.

Once approved, your trademark becomes part of the Trademark Register and your mark is officially recognized as yours to use throughout the United States. You can take legal action if anyone violates your rights by using it without permission.

Trademarks are crucial for any business looking to grow and stand out in a crowded market. They provide brands with a distinctive identity that builds customer trust and loyalty, prevents competitors from stealing ideas, and gives them exclusive rights to their mark in the US. So, don’t let your business blend in – make sure your trademarks are protected.

Copyright

Copyrights are a form of intellectual property law that grants creators exclusive rights to their original works. These rights allow them to reproduce, distribute, create derivative works from, or otherwise exploit their creative works for commercial gain.

Copyright protection is automatically granted when a new work is created – no special registration is needed. Rights may be transferred to another owner by sale, gift, or any other type of agreement.

Copyright also acts as a deterrent to infringement, as it allows creators to take legal action against people who infringe on their rights. The punishment for copyright infringement can range from paying damages to criminal charges in some cases.

Additionally, copyright owners have the exclusive right to prevent others from using their material in an unfair manner, such as copying or distributing it without permission. It’s important for creators to understand their rights and how to protect them in order to ensure their works are respected.

Patent

Patents are legal documents granted to the inventor of a product or process by a governing body. They provide exclusive rights to exploit, make and sell your invention for a specified time period. Patents are an important form of intellectual property protection which safeguards inventors’ inventions from being exploited commercially by competitors.

The patent process can be both complex and lengthy, with applications typically taking up to five years to receive approval. This is why it is advisable to register your patent as soon as possible after you have created your invention in order to ensure that it is properly protected.

To get a valid patent, an invention must be novel, useful and non-obvious. Novelty refers to if the invention is original and has not previously been publicly known or used by another individual or company. The usefulness of the invention is judged on its purpose and the value of its contribution. Non-obviousness means that the efficacy of the invention should not be obvious or easily deduced by a third party looking at the invention for the first time.

If you successfully obtain a patent, it grants you exclusive rights over the patented item, including preventing anyone else from making, selling, importing or using your patented invention without proper authorization from you. If you believe that someone has infringed on your patent rights, then you may seek damages in court for any lost profits, royalty payments or other compensatory damages you might incur.

Ensuring your invention is properly protected with a patent is an essential part of protecting your intellectual property and preserving your rights over the invention.

Remember – It’s of utmost importance to act quickly when protecting your intellectual property. The sooner you begin the application process for trademarks, patents, or copyrights, the better you can ensure no one will be able to use them before you do.

What Does It Cost to Register a Business?

The cost of registering a business in the United States varies from state to state and depends on the type of business you’re registering. Forming an LLC or corporation may cost between a few hundred to a few thousand dollars. Sole proprietorships and some partnerships don’t require registration, so they are free of cost.

Additionally, forming a limited liability company (LLC) is often less expensive than forming a corporation as it requires fewer documents to be filed with the Secretary of State.

It’s also important to consider the ongoing costs associated with owning and running a business, such as taxes, insurance, and other expenses.

Registering a Business as a Foreigner

As a foreigner, you are eligible to register a business in the United States just like any US national. Registering a business in the US offers many advantages, such as having access to the large and integrated market, as well as more competitive tax rates.

The Registration Process

When starting a business as a foreigner, it’s important to understand the process in order to make sure everything is done legally and correctly. The most common way of creating a business is an LLC or C-Corporation.

You’ll also need to register your business in the US state in which you plan to operate and are then subject to the taxes, fees, and other requirements that the state holds. It’s also important to note that even though you may live outside of the US, your business is still required to pay federal and state taxes yearly as well as obtain an EIN for tax filing purposes.

In order to open a bank account for your business, you must have a US address, whether physical or digital. Once you have all of these elements taken care of, you can officially start operating your business as a foreign citizen in the US.

Working in the US

Working in the United States requires a valid visa or green card. Depending on the type of visa, it can grant you access to living and working in the US for an indefinite amount of time.

Visas range from six months to three years and are renewable with approval. With a green card, there are no restrictions on setting up a US business. It’s important to keep in mind not all visas allow for business activities, so make sure to research this before applying.

Obtaining a visa or green card is a complex process, but it is possible with the right resources and guidance.

Frequently Asked Questions (FAQs) on Registering a Business in the US

Can My Company’s Name and Address Act As My Registered Agent?

Yes, your company’s name and address can act as its registered agent. By registering your company in the state where you formed it, you are provided with a physical street address that can be used to receive important legal documents on behalf of your business.

It is essential to have an individual present at this location during regular business hours to ensure that any documents received are quickly addressed, otherwise, repercussions could follow due to missed or late responses.

If the responsibility feels overwhelming, hiring a registered agent service may be the best option for you.

Can I Register a Business Name and Not Use It?

Yes, you can register a business name and not use it immediately. It is a common practice for entrepreneurs to reserve a name in case they decide to use it in the future. You can reserve the business name for future use by registering it with your local government.

By doing this, you will make sure no one else will be able to claim the same business name or use it without your permission.

However, this doesn’t mean that you can keep the name indefinitely; each state has its own regulations about how long you can hold onto a business name before you need to start using it or giving it up. Be sure to check with your local government to find out what the time limit is in your area.

Additionally, be aware that if you don’t use the business name, someone else may decide to take it up which could lead to confusion since both of you are now using the same name. To avoid any problems, make sure to monitor your business name closely after registering it.

Should I Get an EIN for My LLC?

Yes, you should get an EIN for your LLC. An EIN allows you to open a business account and it is required for filing tax paperwork at both the state and federal levels. Obtaining an EIN is relatively simple and free of cost and it can be done online through the IRS website.

How Long Does Incorporation Take?

The timeframe for successfully incorporating a business or LLC can vary depending on the state you reside in. Generally, the process should take no longer than 10 days if all paperwork is filled out correctly. However, some states may take up to several months to verify and approve everything before your business is allowed to operate. If time is of the essence, many states offer expedited services that can speed up the process significantly.

What do I need to register a business in the US?

To register a business in the US, you’ll need to choose a business name and decide which state to incorporate it in. After that, you’ll need to fill out the necessary paperwork for your chosen state and pay any required fees or taxes.

Depending on the type of business, you may also need to obtain certain licenses or permits. Lastly, you’ll need to create a Registered Agent to accept legal documents on your business’s behalf. Once everything is in order, you can officially register your business and start operating.

How much does it cost to register a company in the US?

The cost of registering a company in the US varies from state to state, generally ranging between $250-$1,500. You’ll need to consult with your local authorities to determine the exact costs involved in setting up and incorporating your business, filing all necessary paperwork included.

How can a foreigner start a business in the US?

A foreigner looking to start a business in the US must first obtain the necessary visa allowing them to do so. Once they have obtained the visa and determined what type of business entity they want to open (e.g. a corporation or LLC), the next step is to register the business with their local authorities. This involves filing paperwork including articles of incorporation/organization, obtaining an Employer Identification Number, and registering for any applicable taxes.

They may also need to obtain state licenses and permits depending on the nature of their business and the location. Once these steps have been completed, they can begin running their business and capitalizing on potential opportunities.

Can a non-citizen start a business in the US?

Yes, non-citizens can start a business in the United States. US laws are designed to be welcoming to entrepreneurs from all countries and allow them to contribute to the US economy.

You do not need to be a US citizen or resident, but you may still need to obtain various permits and licenses as required by state and local governments depending on the type of business.

Additionally, foreign entrepreneurs should also consider how their immigrant status may affect their ability to stay in the country while running their businesses.

How do I register as an LLC in the US?

To register an LLC in the US, start by drawing up Articles of Organization and having them signed by all the LLC members. Then file the application with your state’s Secretary of State office and pay the filing fee. Lastly, obtain an Employer Identification Number from the Internal Revenue Service and apply for any necessary licenses or permits from local authorities.

Bottom Line

Registering a business in the US is a simple process if you have done the necessary research to identify the type of company that best suits your needs. The digital age has made it easier than ever to create a business, and several services offer assistance to help make the process even simpler. All you need is creativity, research, and sufficient funds to cover setup fees, plus a US address for obtaining an EIN and opening a bank account. Following the steps outlined above will greatly reduce stress and enable you to register your business correctly the first time. With this guide, you’re only a few steps away from owning a business of your own!