Do you have a new idea for a business? If so, congratulations! According to the Small Business Administration, more than 600,000 new businesses are started each year in the United States. Small businesses also account for almost half of the workforce.
In my eBook The Small Business Mindset: How to Turn Your Idea Into a Business, I walk you through the groundwork for establishing your business. There is a lot to consider, with the most important part of your business being you! You provide the creativity and ingenuity side to your business idea.
As you are getting your business established, a good first step would be to meet with an accountant. The best time to do this is after tax season (May through December). Accountants will typically have a lot more time to meet with you post tax season, and most first time consultations are free. When I first considered starting my own business, my CPA (Certified Public Accountant) was one of my first calls. Everyone’s financial situation is different, and this is not a one-size-fits-all arrangement. Depending upon your current tax filing status (whether you are single, married,have dependents, etc) having a business incorporation strategy will be key to how you not only protect yourself as a business owner from certain liabilities, but also how you can take advantage of certain tax deductions and benefits.
Creating a new business entity (and this is separate from just establishing the name of your business) is not expensive, but in my opinion necessary. Let the experts walk you through this. Some ways that you could structure your business include:
|Sole proprietorship||Unincorporated business with one owner or jointly owned by a married couple|
|General partnership||Unincorporated business with two or more owners|
|Limited partnership||Registered business composed of active, general partners and passive, limited partners|
|Limited liability partnership||Partnership structure that shields all partners from personal liability|
|Limited liability limited partnership||Type of limited partnership with some liability protection for general partners|
|Limited liability company (LLC)||Registered business with limited liability for all members|
|Professional limited liability company||LLC structure for professionals, such as doctors and accountants|
|C-corporation||Incorporated business composed of shareholders, directors, and officers|
|S-corporation||Incorporated business that is taxed as a pass-through entity|
|Professional corporation||Corporate structure for professionals, such as doctors and accountants|
|B-corporation||For-profit corporation that is certified for meeting social and environmental standards|
|Nonprofit||Corporation formed primarily to benefit the public interest rather than earn a profit|
I’m excited for you to start on the journey to establishing your business! Tap into the experts in your area to ask what is the best fit for you. If you are unsure of who to contact first, reach out to your local Chamber of Commerce, SBDC Office, or business network to get referrals.