Launch your business

You’ll want to choose a business name that reflects your brand identity and doesn’t clash with the types of goods and services you offer.

Once you settle on a name you like, you need to protect it. There are four different ways to register your business name. Each way of registering your name serves a different purpose, and some may be legally required depending on your business structure and location.

• Entity name protects you at a state level
• Trademark protects you at a federal level
• Doing business as (DBA) doesn’t give legal protection, but it might be legally required
• Domain name protects your business website address

Each of these name registrations are legally independent. Most small businesses try to use the same name for each kind of registration, but you’re not normally required to.

Entity name

An entity name can protect the name of your business at a state level. Depending on your business structure and location, the state may require you to register a legal entity name.

Your entity name is how the state identifies your business. Each state may have different rules about what your entity name can be and usage of company suffixes. Most states don’t allow you to register a name that’s already been registered by someone else, and some states require your entity name to reflect the kind of business it represents.

In most cases, your entity name registration protects your business and prevents anyone else in the state from operating under the same entity name. However, there are exceptions pertaining to state and business structure.

Check with your state for rules about how to register your business name.

Trademark

A trademark can protect the name of your business, goods, and services at a national level. Trademarks prevent others in the same (or similar) industry in the United States from using your trademarked names.

For example, if you were an electronics company and wanted to call your business Springfield Electronic Accessories and one of your products Screen Cover 5000, trademarking those names would prevent other electronics businesses or similar products from using those same names.

Businesses in every state are subject to trademark infringement lawsuits, which can prove costly. That’s why you should check your prospective business, product, and service names against the official trademark database, maintained by the United States Patent and Trademark Office.

Doing business as (DBA) name

You might need to register your DBA — also known as a trade name, fictitious name, or assumed name — with the state, county, or city your business is located in. Registering your DBA name doesn’t provide legal protection by itself, but most states require you to register your DBA if you use one. Some business structures require you to use a DBA.

Even if you’re not required to register a DBA, you might want to anyway. A DBA lets you conduct business under a different identity from your own personal name or your formal business entity name. As an added bonus, getting a DBA and federal tax ID number (EIN) allows you to open a business bank account.

Multiple businesses can go by the same DBA in one state, so you’re less restricted in what you can choose. There’s also more leeway in the clarity of business function. For example, a small business owner could use Springfield Electronic Accessories for their entity name but use TechBuddy for their DBA. Just remember that trademark infringement laws will still apply.

Determine your DBA requirements based on your specific location. Requirements vary by business structure as well as by state, county, and municipality, so check with local government offices and websites.

Domain name

If you want an online presence for your business, start by registering a domain name — also known as your website address, or URL.

Once you register your domain name, no one else can use it for as long as you continue to own it. It’s a good way to protect your brand presence online.

If someone else has already registered the domain you wanted to use, that’s okay. Your domain name doesn’t actually need to be the same as your legal business name, trademark, or DBA. For example, Springfield Electronic Accessories could register the domain name techbuddyspringfield.com.

You’ll register your domain name through a registrar service. Consult a directory of accredited registrars to determine which ones are safe to use, and then pick one that offers you the best combination of price and customer service. You’ll need to renew your domain registration on a regular basis.

Your location and business structure determine how you’ll need to register your business. Determine those factors first, and registration becomes very straightforward.

For most small businesses, registering your business is as simple as registering your business name with state and local governments.

In some cases, you don’t need to register at all. If you conduct business as yourself using your legal name, you won’t need to register anywhere. But remember, if you don’t register your business, you could miss out on personal liability protection, legal benefits, and tax benefits.

Beneficial ownership information (BOI) reporting

Many companies in the United States have to report information about their beneficial owners – the individuals who ultimately own or control the company. This report is made to the Financial Crimes Enforcement Network (FinCEN). FinCEN is a bureau of the U.S. Department of the Treasury. BOI reporting is a requirement of the Corporate Transparency Act of 2021.

Companies that are required to comply are called reporting companies. The majority of reporting companies must file their initial, updated or corrected reports by March 21, 2025. For additional information, refer to FinCEN’s BOI notice (PDF).

Beneficial ownership information reporting is not an annual requirement. A report only needs to be submitted once, unless the filer needs to update or correct information. FinCEN’s E-Filing system is simple, secure, and free of charge. Learn more about beneficial ownership information reporting at www.fincen.gov/boi.

Other reporting requirements

Other business reporting requirements depend on the nature of your business. Most businesses will need to file to get a federal tax ID. Small businesses sometimes have to register with the federal government for trademark protection or tax-exempt status.

• If you want to trademark your business, brand or product name, file with the United States Patent and Trademark office once you’ve formed your business.
• If you want tax-exempt status for a nonprofit corporation, register your business as a tax-exempt entity with the IRS.
• To create an S corp, you’ll need to file form 2553 with the IRS.

If your business is a limited liability company (LLC), corporation, partnership, or nonprofit corporation, you’ll probably need to register with any state where you conduct business activities.

Typically, you’re considered to be conducting business activities in a state when:

• Your business has a physical presence in the state
• You often have in-person meetings with clients in the state
• A significant portion of your company’s revenue comes from the state
• Any of your employees work in the state

Some states allow you to register online, and some states make you file paper documents in person or through the mail.

Most states require you to register with the Secretary of State’s office, a Business Bureau, or a Business Agency.

Look up your state

State registration lookup coming soon.

Get a registered agent

If your business is an LLC, corporation, partnership, or nonprofit corporation, you’ll need a registered agent in your state before you file.

A registered agent receives official papers and legal documents on behalf of your company. The registered agent must be located in the state where you register.

Many business owners prefer to use a registered agent service rather than take on this role themselves.

File for foreign qualification

If your LLC, corporation, partnership, or nonprofit corporation conducts business activities in more than one state, you might need to form your business in one state and then file for foreign qualification in other states where your business is active.

The state where you form your business will consider your business to be domestic, while every other state will view your business as foreign. Foreign qualification notifies the state that a foreign business is active there.

Foreign qualified businesses typically need to pay taxes and annual report fees in both their state of formation and states where they’re foreign qualified.

To foreign qualify, file a Certificate of Authority with the state. Many states also require a Certificate of Good Standing from your state of formation. Each state charges a filing fee, but the amount varies by state and business structure.

Check with state offices to find out foreign qualification requirements and fees.

File state documents and fees

In most cases, the total cost to register your business will be less than $300, but fees vary depending on your state and business structure.

The information you’ll need typically includes:

• Business name
• Business location
• Ownership, management structure, or directors
• Registered agent information
• Number and value of shares (if you’re a corporation)

The documents you need — and what goes in them — will vary based on your state and business structure.

In addition, some states also require you to register your DBA — a trade name or a fictitious name — if you use one. Check with your state government office to determine what’s required in your area.

Typically, you don’t need to register with county or city governments to actually form your business.

If your business is an LLC, corporation, partnership, or nonprofit corporation, you might need to file for licenses and permits from the county or city.

Some counties and cities also require you to register your DBA — a trade name or a fictitious name — if you use one.

Local governments determine registration, licensing, and permitting requirements, so visit local government websites to find out what you need to do.

Some states require you to provide reports soon after registering depending on your business structure.

You may need to file additional documentation with your state tax board or franchise tax board. These filings are typically referred to as Initial Reports or Tax Board registration, and most often need to be filed within 30-90 days after you register with the state.  

Check with your local tax office or franchise tax board, if it applies to you.

Your Employer Identification Number (EIN) is your business’s federal tax ID number. You need it to pay federal taxes, hire employees, open a bank account, and apply for business licenses and permits.

It’s free to apply for an EIN, and you should do it right after you register your business.

Your business needs a federal tax ID number if it does any of the following:

• Pays employees
• Operates as a corporation or partnership
• Files tax returns for employment, excise, or alcohol, tobacco, and firearms
• Withholds taxes on income, other than wages, paid to a non-resident alien
• Uses a Keogh Plan (a tax-deferred pension plan)
• Works with certain types of organizations

You can apply and receive an EIN immediately using the IRS assistance tool. It will guide you through questions and ask for your name, social security number or taxpayer ID number, and business structure. If you are a third-party, you will also need signed authorization to apply. Your nine-digit federal tax ID becomes available immediately upon verification. Do not apply for an EIN on websites that charge a fee – the EIN application is free of cost.

Change or replace your EIN

If you already have an EIN, you might have to change or replace it with a new one if certain changes have occurred with your business, depending on your business structure and the kind of change that occurred. In general, you need a new EIN when your business’s ownership or structure changes. Check with the IRS to determine exactly whether you need to change or replace your EIN.

Deactivate your EIN

An EIN cannot be canceled as it is an assigned, permanent federal ID number. However, if you no longer need your EIN, the IRS can deactivate it if your organization is not exempt, and you have filed all outstanding tax returns and paid any taxes owed. Both SBA and the IRS have guidance on closing or selling your business. 

Receiving an EIN you didn’t request

Occasionally, someone may request an EIN on your behalf for a legitimate business reason. If you receive a notice for an EIN that isn’t yours, the IRS recommends that:

• You first confirm that it was not a legitimate request on your behalf.
• If you confirm that it was not requested on your behalf, report it using the IRS’s Business Identity Theft Affidavit (PDF).
• If your EIN was stolen, follow the IRS’s steps to report business identity theft.

The need for a state tax ID number ties directly to whether your business must pay state taxes. Sometimes, you can use state tax ID numbers for other functions, like protection against identity theft for sole proprietors.

Tax obligations differ at the state and local levels, so you’ll need to check with your state’s websites.

To know whether you need a state tax ID, research and understand your state’s laws regarding income taxes and employment taxes, the two most common forms of state taxes for small businesses.

The process to get a state tax ID number is similar to getting a federal tax ID number, but it will vary by state. You’ll have to check with your state government for specific steps.

State income and employment taxes for businesses

Seven states have no income tax, and another two only impose tax on income from dividends. States that do tax income will determine figures based on business structure.

Taxes also vary by state on employment insurance and workers’ compensation insurance. Understand these and other implications in calculating startup costs and choosing a business structure.

Visit your state’s website to identify whether you need to get a state tax ID number in order to pay state taxes.

Look up your state

Use the tool under “Look up your state.”

Most small businesses need a combination of licenses and permits from both federal and state agencies. Business activities regulated by a federal agency will need a federal license or permit.

Check to see if any of your business activities are listed here. If they are, then check with the right federal agency to see how to apply.

Requirements and fees depend on your business activity and the issuing agency. Check with them for details on the business license cost.

The licenses and permits you need from the state, county, or city will depend on your business activities and business location. Your business license fees will also vary. You may also need licenses from your county or city.

States tend to regulate a broader range of activities than the federal government. Business activities that are commonly regulated at the local level include:

• Auctions
• Construction
• Dry cleaning
• Farming
• Plumbing
• Restaurants
• Retail
• Vending machines

Some licenses and permits expire after a set period of time. Keep close track of when you need to renew them — it’s often easier to renew than it is to apply for a new one.

You’ll have to research your own state, county, and city regulations. Industry requirements often vary by state. Visit your Secretary of State’s website to find out which permits and licenses you need. 

As soon as you start accepting or spending money as your business, you should open a business bank account. Common business accounts include a checking account, savings account, credit card account, and a merchant services account. Merchant services accounts allow you to accept credit and debit card transactions from your customers.

You can open a business bank account once you’ve gotten your federal EIN. 

Most business bank accounts offer perks that don’t come with a standard personal bank account. 

• Protection. Business banking offers limited personal liability protection by keeping your business funds separate from your personal funds. Merchant services also offer purchase protection for your customers and ensures that their personal information is secure. 
• Professionalism. Customers will be able to pay you with credit cards and make checks out to your business instead of directly to you. Plus, you’ll be able to authorize employees to handle day-to-day banking tasks on behalf of the business.
• Preparedness. Business banking usually comes with the option for a line of credit for the company. This can be used in the event of an emergency, or if your business needs new equipment.
• Purchasing power. Credit card accounts can help your business make large startup purchases and help establish a credit history for your business. 

• Product/trade name franchising: The franchisor owns the right to the name or trademark of a business, and sells the right to use that name and trademark to a franchisee. This style of franchising normally focuses on supply chain management. Typically, products are manufactured or supplied by the franchisor and delivered to the franchisee to sell.
• Business format franchising: The franchisor and franchisee have an ongoing relationship. This style of franchising normally focuses on full-spectrum business management. Typically, the franchisor offers services like site selection, training, product supply, marketing plans, and even help getting funding.

When you buy a franchise, you get the right to use the name, logo, and products of a larger brand. You’ll also get to benefit from brand recognition, promotions, and marketing. But, it also means you have to follow rules from the larger brand about how you run your business.

Buying an existing business gives you more control but less guidance

Buying an existing business is exactly what it sounds like. The buyer typically takes over full ownership of the business. The largest advantage is having an existing blueprint that can include important factors like an established customer base, defined operating expenses, and fully trained employees. Regardless of business type, almost any kind of business could be bought or sold.

When you buy an existing business, you typically get complete control over its direction. However, with no set vision, infrastructure, or external guidance, your business could struggle as you figure out the best way to run things. SBA’s Surety Bond Guarantee (SBG) Program enables surety companies and agents to issue bonds backed by the SBA. This helps small businesses obtain contract surety when they might otherwise face barriers.

Some business owners open a business account at the same bank they use for their personal accounts. Rates, fees, and options vary from bank to bank, so you should shop around to make sure you find the lowest fees and the best benefits.

Here are things to consider when you’re opening a business checking or savings account:

• Introductory offers
• Interest rates for savings and checking
• Interest rates for lines of credit
• Transaction fees
• Early termination fees
• Minimum account balance fees

Here are things to consider when you’re opening a merchant services account:

• Discount rate: The percentage charged for every transaction processed
• Transaction fees: The amount charged for every credit card transaction
• Address Verification Service (AVS) fees
• ACH daily batch fees: Fees charged when you settle credit card transactions for that day
• Monthly minimum fees: Fees charged if your business doesn’t meet the minimum required transactions

Payment processing companies are an increasingly popular alternative to traditional merchant services accounts. Payment processing companies sometimes provide extra functionality, like accessories that let you use your phone to accept credit card payments. The fee categories that you need to consider will be similar to merchant services account fees. If you find a payment processor that you like, remember that you’ll still need to connect it to a business checking account to receive payments.

Opening a business bank account is easy once you’ve picked your bank. Simply go online or to a local branch to begin the process. Here are some of the most common documents banks ask for when you open a business bank account. Some banks may ask for more.

• Employer Identification Number (EIN) (or a Social Security number, if you’re a sole proprietorship)
• Your business’s formation documents
• Ownership agreements
• Business license

You get some protections from the kind of business structure you choose.  A limited liability company (LLC) or a corporation status can protect your personal property from lawsuits. However, that protection has limits.

Unexpected catastrophe? Business insurance can fill in any gaps in coverage. This will make sure both your personal and business assets are fully protected.

You also may be legally required to purchase certain types of business insurance.

The federal government requires every business with employees to have the following:

• Workers’ compensation 
• Unemployment
• Disability insurance

Some states also require additional insurance. Laws requiring insurance vary by state. Visit your state’s website to find out the requirements for your business.  

After you purchase insurance that’s required by law, you can find insurance to cover any other business risk. As a general rule, you should insure against things you wouldn’t be able to pay for on your own.

Speak to insurance agents to find out what kinds of coverage makes sense for your business. Then compare terms and prices to find the best deal for you. Here are six common kinds of business insurance to look for:

• Assess your risks. Think about what kind of accidents, natural disasters, or lawsuits could damage your business. Is your business located in a commercial area that is at risk from seasonal events? Commercial property insurance will help protect against loss.
• Find a reputable licensed agent. Commercial insurance agents can help you find policies that match your business needs. They receive commissions from insurance companies when they sell policies, so it’s important to find a licensed agent that’s interested in your needs as much as his or her own.
• Shop around. Prices and benefits can vary significantly. You should compare rates, terms, and benefits for insurance offers from several different agents.