Congratulations—you’ve landed on a business idea that can benefit your community while turning a profit! In order to get your idea off the ground, you’ll need to incorporate your business as its own entity. Take these steps one at a time, and you’ll soon be a proud and proper business owner.
Choose a Unique Name
What are you going to call your business? As you brainstorm a name, do some cursory Internet research to make sure no one else is using the one you want. Take care not to choose a name that’s too similar to other prominent businesses to avoid confusion.
Register Your Business
You’ll need to register your new business in the state where you intend to operate. This process may encompass multiple states if you have remote employees or a chain of disparate locations.
Depending on your niche, you may also need to secure relevant permits from your city or county office. For example, if you’re opening a restaurant that serves alcohol, you’ll need to obtain a liquor license.
Choose a Corporate Structure
There are plenty of different legal structures to choose from when opening a business. Your choice will depend on how many owners the business has, how you’re funding it, and how much liability you’re willing to take on. The most common legal business structures include:
- Sole proprietorship
- S corporation
- Limited liability company (LLC)
- C corporation
Good To Know:
If you’re financing your business with a 401(k) Rollover for Business Startups, you will need to set it up as a C corporation. This structure allows you to roll your existing 401(k) funds into a new program in your business’s name.
File Articles of Incorporation
The final step involves a single document called the Articles of Incorporation. You’ll file it with the Secretary of State’s office in whichever state (or states) you intend to operate. In this document, you’ll include the following:
- Your business’s name and primary address
- The purpose of your business
- Your registered agent (primary representative of the company)
- The amount and type of stock your business will issue
There is a fee for filing this document, so plan to spend around $100 on this step.
When you’re ready to incorporate your business and bring your idea into the real world, follow these steps to complete the process. Consider your company’s niche and needs as you choose a corporate structure, and take care to secure all the permits you need to operate.
Looking for unique ways to inject capital into your fledgling business? Use Pango Financial’s funding solutions tool to learn more about the options available to you.