Starting a business takes lot of planning and hard work. You need to worry about many different aspects, including finance, real estate, technology and so on. One of the most important tasks you need to worry about is essential legal requirements that you need to fulfill. So, what are these requirements? Let’s find out.
- Registering the Business Name
When you want to start a business, you need to come up with a name for it and get it registered with the Secretary of the State’s office.
What’s more?
You also should consider purchasing a domain name for your business and a trademark to ensure that nobody else can operate with the same business name.
- Determine Your Legal Entity Type
The next step in starting your business is that of choosing the type of legal entity for your company. There are numerous legal entities that you can choose from and each has a different set of features.
The most popular business structures are:
- Sole Proprietorship
- Partnership
- Limited Liability Company (LLC)
- Corporation
- Non-Profit Organization (NGO)
- Trust
- Complete Your State Filings
After you’ve selected the legal entity type for your business, you need to complete your state filings to formally establish your company.
For each type of legal entity, you need to do different filings.
- Articles of Organization for LLCs
- Articles of Incorporation for Corporations
- Doing Business As or Fictitious Business Name for Partnerships and Sole Proprietorships
- File for a Federal EIN
To set up your company, you also need to apply for a federal Employer Identification Number (EIN).
But why?
Without an EIN, you won’t be able to hire employees, open a business bank account, sign vendor contracts, or even earn and report income.
- Create Important Agreements and Contracts
You also need to create legally binding agreements and contracts so that you can use them in case any disagreements happen in the future. As a result, they can save you thousands of dollars in legal fees.
Some of the essential contracts you should create include:
- Operating Agreements for LLCs
- Multi-Lateral or Unilateral Non-Disclosure Agreements
- Corporate Bylaws for Corporations
- Confidentiality Agreements
- Independent Contractor Agreements
- Employment Agreements
- Open a Business Bank Account
The final step that you should take for starting your business is that of opening a bank account for your business. Doing this can help you separate your personal finances from those of your business.
To start a business bank account, you need to submit your EIN, state formation documents, business license, and ownership agreement documents.
If you want to learn more about how you can start a business from scratch, check out the infographic below which was designed by GovDocFiling.
Image Courtesy: GovDocFiling
Author Bio: Brett Shapiro is a co-owner of GovDocFiling. He had an entrepreneurial spirit since he was young. He started GovDocFiling, a simple resource center that takes care of the mundane, yet critical, formation documentation for any new business entity.
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