Business Startup Checklist.pdf - Smartgrowth

<strong>Business</strong> Start-up <strong>Checklist</strong>You’ve decided to start a business. This is both an exciting and demanding time. The checklist below ismeant to help new business owners by providing a list of the most common start-up steps. Depending onyour particular industry, additional steps may be required for your particular business.Since you are on the <strong>Business</strong> Filings website, we are assuming that you are either already in the processof forming a corporation, limited liability company (LLC), or nonprofit, or are evaluating whether to formyour business. Therefore, this checklist begins with incorporation.□ Incorporate your business or form your LLC with the state. Forming a business as a corporationor LLC helps to protect the owners’ personal assets from the debts and liabilities of the business. Thereare also other advantages of forming a corporation or LLC, including certain tax advantages andestablishing credibility for your new business with potential customers, vendor, employees, and partners.□ Prepare a business plan, if you have not done so already. <strong>Business</strong> plans define the Who, What,When, Where, and How of your business and the products and/or services you plan to provide. <strong>Business</strong>plans clearly outline the goals of the business, explain the operating procedures, detail the competition,include a marketing plan, and explain the company’s current and desired funding. If your company plansto seek funding either in the form of a traditional loan or from venture capitalists, a thorough businessplan will be required for the application process.□ Select an accountant and attorney. Many small business owners turn to accountants andattorneys for advice when starting out, as well as through the life of the business. Many people seekreferrals from friends, family members, or other small business owners in order to find an attorney and/oraccountant. You may want to search for professionals who have worked with other small businessowners, possibly in your same industry, and are familiar with the unique business situations smallbusiness owners often face.□ Obtain the federal tax identification number (also called employer identification number orEIN) for your business from the Internal Revenue Service (IRS). The EIN is like a social security numberfor a business, and is required for corporations and LLCs that will have employees. The IRS uses thisnumber to identify your business for all taxation matters. <strong>Business</strong> Filings can assist you with thepreparation of IRS Form SS-4 for you to obtain an EIN or can obtain the EIN on behalf of your business.□ Obtain the state tax identification number for your business (if applicable). Some statesrequire businesses to also have a state tax identification number. To learn if your state has thisrequirement, contact your state’s taxation department.□ Open a business bank account. It is very important for corporations and LLCs to keep thefinances of the business separate from those of the owners. To open a business bank account, most banksrequire information on the company, such as its formation date and type of business, and names andaddresses of its owners. Some banks require corporations to provide a resolution from the board ofdirectors or LLC members/managers authorizing the opening of the business bank account. In New York,a corporate or LLC seal is often required. It is advisable to contact the bank about their business bankaccount requirements prior to trying to open an account. That way, you will come prepared with all thenecessary items.□ Apply for business loans (if applicable). Not all small business owners have enough of their owncapital to start a business, and many seek outside funding from sources such as banks or through Small<strong>Business</strong> Administration (SBA) loan programs.

□ Obtain the necessary business licenses and/or permits. Most businesses need licenses in orderto begin operations. Licenses may be required for your city, your municipality, your county and/or yourstate. It is best to contact both your Secretary of State to check on business license requirements for yourparticular type of business and industry, and also to contact your local government agency in charge oflicensing to learn their requirements and how to obtain the necessary licenses.□ Obtain business insurance. Just as you have personal insurance you should obtain insurance foryour business. Some industries may have specific insurance requirements. Discuss your particularindustry and business needs with your insurance agent, to ensure you obtain the appropriate type andamount of insurance.□ Investigate other insurance and government requirements. <strong>Business</strong>es face a numbergovernment and insurance requirements, particularly if the business has employees. You shouldinvestigate your business’s obligations for the following:• Unemployment insurance• Workers’ compensation• OSHA requirements• Federal tax• State and local tax• Self-employment tax• Payroll tax requirements (such as FICA, federal unemployment tax, and state unemployment tax)• Sales and use tax•□ Check zoning requirements. This is particularly important if you are starting a home-basedbusiness. You’ll want to ensure you are meeting your city’s zoning requirements for your area.□ Lease office space. If you are not going to be operating a home-based business, you’ll probablyneed to find office space for your new company. Along with leasing an office, don’t forget to purchase orlease the furniture and office equipment you will need to get your business up and running.□ Set up your business accounting. You may decide that your accountant will handle theaccounting for your business, or you may want to handle the accounting yourself with a small businessaccounting solution such as QuickBooks. Either way, you’ll want to ensure that you are prepared toproperly account for all business disbursements, payments received, invoices, accountsreceivable/accounts payable, etc.□ Establish a line of credit for your business. Establishing a line of credit will help lessen thenumber of times your new business will be required to prepay for the products and services it purchases.It also helps establish a favorable credit history, which is helpful as your business begins establishingvendor and supplier relationships. As a subset of this, obtaining a D&B D.U.N.S. number for yourbusiness is also advisable. D&B (formerly Dun & Bradstreet) is the resource most often used to check thecreditworthiness of a business.□ Create business materials. Having materials such as a logo for your business, business cards,and stationery will help your business develop an identity and potential customers find you.□ Develop a marketing plan for your products/services. A primary reason you are starting yourown business may be the hope of making money. In order to make sales, people need to be aware of whatyou’re selling and how to find you.

For additional information on starting a business, we recommend you visit the CCH <strong>Business</strong> Owner’sToolkit (http://www.toolkit.cch.com) or the SBA’s website(http://www.sba.gov/starting_business/index.html).For questions regarding requirement for your specific industry or type of business, it is best to seek theadvice of an attorney or accountant.