What Are The Steps In Setting A New Business?

– First you need to determine if you are going to be running your business at a commercial property or at home. Usually small business owner run there business at home because its cost saving but eventually if their business is profitable they move in into a commercial property. If you are running a online business and your don’t want to use your home address as your business location, you can also setup a virtual office that will allow you to use their business address.

– Next Inquire a Employer Identification Number (EIN) for your business. You may apply for an EIN online if your principal business is located in the United States or U.S. Territories. Basically, having an EIN helps you separate your personal finances and personal life from your business, which will limit liability in the case of a lawsuit.

– After that you will need to register your business with your county or district (Link). Make sure have you business location, contact number, EIN or SSN ready to be inputted. If you have partner make sure you have their contact info as while.

– Finally marketing your business. Usually new business don’t have the enough funds to market their business because it can get real expensive. So a lot of new business owners have turn to social media platforms like Facebook, Instagram, Youtube etc, which have a total of a billion users, to market their business for free and their app are free to download as while. You can also print flyers, pay for radio or local broadcast channels for advertisement to even creating your own website as while but if you have enough funds you can just pay a marketing company to do all that for you.

Which Business Type Should I Use?

Limited Liability Company (LLC) – Has better flexibility in how you manage and run your business. Unlimited owners ( “members” ) allowed , your personal assets won’t be on the hook for business liabilities, your are taxed once or twice; you’re free to choose either or to get the best taxes deduction, you must stay in compliance with all your documents and fees. LLCs can not go public, meaning this business type can not register to be in the stock market. Also you are not recognized globally; you may be taxed as a corporation in other countries.

S Corporation – Has a max of 100 shareholders max in the stock market, owners can only get common stock, you’re not personally on the hook for business liabilities, you’re taxed once only when shareholders pay on profits received, you must stay in compliance with all your documents and fees. Less management flexibility; must have a board of directors and more administration; strict rules about holding meetings and keeping records and all shareholders must be U.S. citizens or residents in the U.S..

C Corporation – It’s best used if you’re planning to go public in the stock market one day. You can issue shares to founders, employees, and investors, you have unlimited owners ( “shareholders” ) allowed but owners may get preferred stock. Your company will be acknowledge internationally. Investor will want to do more business with you. You’re not personally on the hook for business liabilities, you will be taxed twice once on the business pays at the corporate level, and once on the shareholders pay on income received. You must stay in compliance with all your documents and fees. Less management flexibility; must have a board of directors and more administration; strict rules about holding meetings and keeping records.

Nonprofit – Usually are formed to support a good cause. This title will also protect your personal assets so you won’t be hooked for business liabilities. No owners are required, you can start or oversee a nonprofit, but you can’t technically own it. Gives you access to public and private grants, tax exempt—if you have 501(c)(3) status with the IRS. You must stay in compliance with all your documents and fees. Less management flexibility; must have a board of directors and more administration; strict rules about holding meetings and keeping records. You will pay more for application and filing fees if you try for 501(c)(3) tax-exempt status.

Partnership – Partnership is the relationship between two or more people to do trade or business. Each person contributes money, property, labor or skill, and shares in the profits and losses of the business. You have the option to select General partnership, Limited partnership or limited liability partnership.

Why Do I Need A Small Business Loan?

Small-business loans can help you get started or level up an existing business. Loan programs from direct lenders and the Small Business Administration, including the SBA Paycheck Protection Program, can infuse working capital loans and other financial support when you need it the most.

How Does A Small Business Loan It Work?

Small-business loans are used for business expenses. While some loans are for general business funding, others are for specific uses, such as working capital loans, real estate loans or equipment financing. Occasionally, small-business term loans offer a pile of cash that you’ll pay back with interest over time. But there are a variety of business loan types, so small-business owners should research their need that best fit their business.

How Do I Get Started With The Business Loan Application?

Small-business loans require significant documentation. You’ll need to fill out an application and provide supporting documents, which you should be ready to submit to the lender. Required documentation often includes:

• • • Personal background and resumes
    •  A business plan
    • Income tax returns for at least two years
    • Documentation of past and current business loans
    • At least 12 months of personal and business bank account statements
    • Documents detailing the cost and value of personal or business property that can be used to secure a loan
    • An explanation of how you plan to use the loan
    • Debt schedule
    • Legal documents, including licenses, leases, articles of incorporation, and contracts or agreements