Starting Your Business
A simple, clear guide to help you start your business with confidence.
Starting a business does not have to feel confusing or overwhelming. This page breaks down every foundational step in a clean, beginner friendly way so you can understand what to do, why it matters, and how to do it correctly.
Each section below covers a core topic you need to know when launching any business. Follow them at your own pace and come back anytime.
1. How to Register an LLC
Registering an LLC is one of the most common ways to make your business official. It creates a legal separation between you and the company, which protects your personal assets, gives you credibility, and allows you to open real business accounts.
Below is everything you need to know, step by step.
What an LLC actually is
An LLC is a Limited Liability Company. It protects your personal belongings, such as your savings, home, and car, if something goes wrong with the business. The company becomes its own legal entity. You still own it, but you are not legally the same as the business.
This is why most small businesses start with an LLC. You get protection, flexibility, and a professional foundation.
Step 1: Choose a business name that is available in your state
Your business name must be unique. No one else in your state can have it.
How to check
Go to your state’s Secretary of State website
Look for Business Name Search or Entity Search
Type in your name ideas
Choose a name that is available and easy to search
Tips for choosing a name
Avoid names too similar to an existing business
Keep it simple and easy to spell
Think long term, choose something that can grow with you
Step 2: Go to your state’s Secretary of State website
This is where you officially form your LLC. Every state uses its own website, but the process is almost identical.
Search online:
Your state name plus Secretary of State business filing
Example: New York Secretary of State LLC
Once on the site, look for:
Business
LLC Formation
Start a Business
Entity Formation
You will see the application to form an LLC.
Step 3: Find the section for forming an LLC
The form is usually called Articles of Organization.
You will enter basic information
Your name
Your business name
Your business address
Your mailing address
Your registered agent
What is a registered agent
A person or company that receives official mail on behalf of your business
You can be your own if you have a stable address
Or you can pay for a registered agent service
Step 4: Fill out the Articles of Organization
This is the official filing that creates your LLC.
The form will ask for
Your business purpose (you can write general business)
Management type (member managed or manager managed)
Your name and signature
Your registered agent information
Member managed means you run the business
Manager managed means someone else runs it
Most small businesses choose member managed
Fill out the entire form carefully. Review it before submitting.
Step 5: Pay the filing fee
Each state sets its own price. Fees range from around fifty dollars to several hundred depending on the state.
Payment is usually done online with a card.
You do not need a lawyer. You do not need a service like LegalZoom unless you want to pay extra for convenience. Filing directly through your state is cheapest and fastest.
Step 6: Wait for approval and confirmation documents
After you submit the application, the state will process it.
Processing times vary
Some states approve instantly
Some take a few days
Some take up to a few weeks
What you will receive
A Certificate of Formation or Certificate of Organization
A stamped copy of your Articles of Organization
Official confirmation that your LLC legally exists
Keep these documents safe. You will need them for banking, taxes, and future verification.
What You Get After Approval
Once your LLC is approved, you officially have:
Your LLC formation documents
This is proof your company legally exists.
Your official business name
No one else in your state can use it.
The ability to get an EIN
This is your business tax ID from the IRS.
The ability to open business banking
You can now separate personal and business money.
The ability to apply for business credit
Vendors, cards, and lenders will recognize your business.
Why People Choose an LLC
Personal asset protection
If the business is sued or owes money, your personal belongings are protected. Only the business assets are at risk.
Cleaner separation between personal and business
Your money, taxes, and documents stay organized. This makes accounting, taxes, and financial management easier.
Better trust and credibility
Customers, banks, brands, and partners take you more seriously when you operate as a registered business.
Access to business banking and funding opportunities
Banks require an LLC and an EIN to open proper business accounts.
You also gain access to business loans, business credit cards, net 30 vendors, and more.
Summary
Registering an LLC is the foundation of starting a real business. It creates protection, credibility, financial structure, and opens the door for everything else you will build.
2. How to Get Your EIN
Your EIN is your business tax ID number, also called your Employer Identification Number. It works like a social security number, but for your business. You need it for banking, taxes, hiring, and building business credit.
Getting an EIN is fast, simple, and completely free. You should never pay a company or person to get it for you.
Below is everything you need to know.
What an EIN Actually Is
An EIN is a nine digit number assigned by the IRS to identify your business for tax and banking purposes.
Think of it as your business’s official identity in the government system.
You use it when you
open business banking
apply for credit
file business taxes
hire employees
work with certain vendors
sign contracts that require verification
If you have an LLC or you want to run a real business, getting an EIN is a must.
Where and How to Get Your EIN
Step 1: Go to the IRS website
Search online: IRS EIN Application
Or go directly to the IRS dot gov website.
Be careful of ads. Many companies run ads pretending to be the IRS. Only use the official IRS website.
Step 2: Search for Employer Identification Number
On the IRS website, search the term:
Employer Identification Number
or
Apply for an EIN
Click the link that says Apply Online Now.
Step 3: Apply online
The online application is available Monday through Friday during IRS business hours.
The process is simple and takes about ten minutes.
You will need to enter
your name
your social security number
your business name
your business structure
your reason for applying (new LLC, new business etc)
your business address
Once you submit the form, the IRS instantly generates your EIN.
Information You Need Before You Apply
Have these ready
Your legal first and last name
Your social security number
Your business name exactly as written on your LLC
Your business structure
LLC
Sole proprietor
Partnership
Corporation
Your physical or mailing address for the business
This must be a real address, not a P O Box.
If you have an LLC
Your LLC must be approved by your state before you apply
The IRS will ask for your formation date
Why You Need an EIN
To open business banking
Banks require an EIN to open checking, savings, or merchant accounts. You cannot open true business banking with a social security number if you have an LLC.
To hire people
If you ever hire employees or contractors, your EIN is required for payroll forms and federal reporting.
To file business taxes
Your tax filings use your EIN. This helps separate your personal taxes from your business taxes.
To apply for business credit
Business credit cards, vendor accounts, net 30 accounts, and loans require an EIN to verify your business identity.
To work with bigger brands and companies
Many companies will not contract with you unless you have a business tax ID number.
An EIN makes you look legitimate, organized, and trustworthy.
Important Notes About EINs
Never pay anyone for an EIN
This is the biggest scam in the business world.
Your EIN is always free.
You get it directly from the IRS.
No one legitimate charges money for it.
You receive your EIN immediately
After completing the application, the system generates your number right away. You can download your confirmation letter on the spot.
Keep your EIN letter safe
Download and save the PDF.
Email it to yourself.
Store it in cloud storage.
You will need it for banking and future legal paperwork.
If you lose it
You can call the IRS EIN hotline to recover it.
Summary
Getting your EIN is quick, free, and essential. This number unlocks business banking, taxes, credit, and growth opportunities. It is one of the easiest steps in starting a business, and you can complete it in minutes.
3. Sole Proprietor versus LLC
When you start a business, one of the first choices you make is whether to operate as a sole proprietor or form an LLC. These are the two most common options for beginners, and each one works differently in terms of protection, taxes, and professionalism.
This section breaks it down in simple terms so you can choose what fits your situation.
What is a Sole Proprietor
A sole proprietor is the simplest form of business. You and the business are legally the same. There is no separate business entity.
Key characteristics
Fast to start
No formal paperwork required
No filing with your state
No separate legal protection
You use your own name or file a DBA if you want a business name
How taxes work
All income and expenses go on your personal tax return
You pay self employment taxes on your earnings
No separate business tax return
Pros
Very simple
No upfront cost
Perfect for quick side hustles or testing ideas
No complicated filings
Cons
No protection for your personal assets
If the business is sued or owes money, you are fully responsible
Harder to get business banking
Harder to get business credit
Not taken as seriously by clients or companies
Good for
Small, low risk side hustles
Freelancers who are just trying something out
People who do not want to commit to a full business yet
What is an LLC
An LLC creates a legal separation between you and the business. The company becomes its own separate entity, but you still own and control it.
Key characteristics
Personal asset protection
Separate legal identity for your business
Your personal belongings are safer if something goes wrong
Professional and credible
Simple taxes compared to a corporation
How taxes work
By default, LLCs are taxed as pass through
This means profits pass through to you
You file taxes like a sole proprietor unless you choose a different tax status
Pros
Your personal assets are protected
Your business looks more trustworthy
You can open real business banking
You can apply for business credit and funding
You can work with bigger clients and brands
You can hire people more easily
Better for long term growth
Cons
There is a filing fee
You must follow simple compliance rules
You need to stay organized with documents
Good for
Anyone selling products
Anyone offering services to the public
Anyone taking payments under a business name
Anyone wanting a real business foundation
Anyone planning to grow long term
Side by Side Summary
Here is the clear, simplified comparison.
Sole Proprietor
Fast
Cheap
No protection
No separation
Best for quick, low risk, temporary work
LLC
Protected
Professional
Separate legal entity
Better credibility
Best for real, long term business growth
Which One Should You Choose
If you want protection, professionalism, and the ability to grow, choose LLC.
If you need something extremely quick, low risk, and temporary, sole proprietor works but comes with personal risk.
Think of it like this
Sole proprietor is dipping your toe in
LLC is stepping into real business ownership
4. Personal versus LLC versus S Corp
A lot of people get confused when trying to understand the difference between operating personally, forming an LLC, or choosing an S Corp. The good news is that it is much simpler than it seems once you understand what each one actually means.
This section breaks everything down clearly so you can make the right choice for your situation.
Personal
When you operate “personally,” you are not a business.
Everything you do is under your personal legal identity.
Key characteristics
No business entity
No official business protection
You use your personal name and social security number
All income you earn is treated as personal income
How taxes work
You file everything on your personal tax return
No separation between you and what the business earns
Risks
If something goes wrong, you are fully responsible
If someone sues the business, they are suing you personally
Your personal assets are exposed
Good for
Very small, temporary, or casual work
Selling a few items as a hobby
Doing tiny side jobs without a long term plan
Important note
Personal is not a business. It offers no safety, no structure, and no credibility.
LLC
An LLC is the most common business structure for beginners because it creates separation between you and the company.
Key characteristics
You are legally a business
The company exists as its own entity
Your personal assets get protection
You run it how you want, with flexible rules
How taxes work
LLCs use simple pass through taxation
You report your business profits on your personal tax return
No corporate tax burden unless you choose it
Benefits
You gain personal asset protection
You can open business banking
You can build business credit
You look credible and professional
You can work with larger clients and companies
You can grow long term without legal risk
Good for
Small to medium businesses
Service providers
Product based businesses
Creators, consultants, freelancers
Anyone serious about growth
S Corp
An S Corp is not a business entity.
It is a tax status you apply for as an LLC or corporation.
It changes how you pay taxes, not what your business legally is.
Key characteristics
Only available to LLCs or corporations
You pay yourself a salary
Profits above your salary are taxed differently, often at a lower rate
You must follow more strict rules and bookkeeping
When to choose S Corp
Only when your business profit reaches a certain level
The typical range is around fifty thousand to eighty thousand profit per year
This is where S Corp starts saving you real money
Pros
Savings on self employment taxes
More efficient tax structure once your business grows
Better for long term profitability
Cons
More paperwork
More IRS requirements
More rules
You usually need a bookkeeper or accountant
Important
You cannot start as an S Corp without already being an LLC or corporation.
Summary
Here is the simplest way to understand it.
Personal
Not a business
No protection
High risk
Short term only
LLC
Real business
Protection
Simple
Best foundation for almost everyone
S Corp
A tax choice
Only beneficial once you make enough profit
You switch later if it makes sense financially
Clear recommendation
Start as an LLC.
Grow your business.
When your profits rise, consider S Corp for tax savings.
Do not operate personally if you want a real business or protection.
5. Business Licenses and Permits
Not every business needs a license or permit, but many industries do. The requirements depend on what you are selling, where you operate, and the laws in your city or state. This section helps you understand when a license is required, how to check, and what to do if you sell physical products.
What Business Licenses and Permits Actually Are
A business license or permit is approval from your state, city, or county that allows you to legally run your type of business.
Some licenses are general and simple.
Others are industry specific and required for safety, training, or regulation.
Having the right license protects you from fines, shutdowns, and legal issues. It also shows customers that you operate professionally and within the law.
Common Businesses That Require a License
Certain industries almost always require a license or permit, even for small or home based operations.
Food related businesses
Caterers
Bakeries
Mobile food vendors
Meal prep businesses
Food trucks
Any business handling, cooking, or storing food
These typically require
Food handler permit
Health department approval
Kitchen inspections
Cleaning services
Residential cleaning
Commercial cleaning
Specialty cleaning (carpet, mold, sanitation)
Some areas require
General business license
Bonding
Background checks
Beauty and personal care services
Hair stylists
Nail techs
Estheticians
Lash techs
Tattoo artists
Massage therapists
These often require
Professional licenses
Training hours
State exams
Health and sanitation inspections
Childcare
Daycares
Babysitting centers
After school programs
These typically need
Background checks
Facility inspections
Training certifications
Transportation services
Taxi
Shuttle
Delivery driver companies
Non emergency medical transport
Possible requirements
Commercial insurance
Transportation permits
Driver background checks
Construction and trade work
General contractors
Electricians
Plumbers
Handymen
These usually need
Contractor license
Trade certifications
Permits for certain jobs
Home based bakeries or cottage food operations
Many states allow home based food businesses under “cottage food” laws, but they still require permits and clear rules for ingredients, labeling, and storage.
How to Check If You Need a License
Licensing rules vary by location, so it is important to check the requirements for your city or county.
Step 1
Search online for
Your state or county name plus “business license requirements”
Example
“Florida business license requirements”
“Los Angeles County business permit”
Step 2
Visit your local town, city, or county clerk’s website
Look for sections titled
Business
Licenses
Permits
Occupational Licenses
Step 3
Check your state agency websites for your industry
Example
Cosmetology board
Health department
Contractor licensing board
Step 4
If unsure, call your city or county clerk
They can tell you quickly what you need based on your business type.
If You Sell Physical Products
If you sell physical products in almost any state, you may need a sales tax permit (sometimes called a Seller’s Permit or Resale Certificate).
What it allows you to do
Collect sales tax from customers
Buy products wholesale without paying sales tax
Legally sell physical items
How to get it
Visit your state’s Department of Revenue or Tax Department website
Search for “Sales Tax Permit” or “Seller’s Permit”
Apply online
Note
Sales tax rules for digital products vary by state. Always check your local laws.
Summary
Business licenses and permits exist to keep operations legal, safe, and compliant.
Not every business needs one, but when you do, it is important to get the right approval.
To stay protected
Check your local requirements
Apply on your city or state websites
Get a sales tax permit if selling physical goods
This keeps your business legal, professional, and ready for growth.
6. Sales Tax Basics
Sales tax is one of the most common responsibilities for product based businesses, and in some states, certain services as well. Understanding how it works from the beginning keeps your business compliant and prevents unexpected penalties later.
This section explains sales tax in simple terms so you know when to collect it, how to register for it, and how to set it up correctly.
What Sales Tax Actually Is
Sales tax is a fee charged by the state when a customer buys certain goods or services.
You do not pay this tax out of your own pocket. You simply collect it at checkout and send it to the state.
If you sell physical products, you will almost always deal with sales tax.
If you sell services, the rules depend entirely on your state.
Sales tax requirements vary, so always check the laws where your business operates.
Basic Rules to Know
Sales tax is paid by the customer, not you
Your customer pays the tax on top of their purchase.
You collect it and hold it until it is time to send it to the state.
You collect and submit sales tax
Your website or checkout system adds the tax automatically.
You send the collected tax to your state on a monthly or quarterly schedule.
Every state has different rules
Some states tax digital products.
Some tax services.
Some do not tax certain items at all.
This is why checking your state rules is essential.
You must have a sales tax permit if your state requires it
A sales tax permit gives you permission to collect sales tax.
Collecting tax without a permit can lead to fines.
Your permit is sometimes called
Seller’s Permit
Resale Certificate
Sales and Use Tax Permit
Vendor License
How to Set Up Sales Tax Correctly
Step 1: Go to your state’s tax department website
Search online
Your state name plus “Department of Revenue” or “Sales Tax Permit”
Example
Texas Sales Tax Permit
New York Department of Taxation and Finance
Step 2: Search for sales tax permit
Look for
Register for Sales Tax
Sales and Use Tax
Seller’s Permit
Step 3: Register online
You will enter
Your business name
Your business address
Your EIN
Your business structure
Your estimated monthly sales
Once approved, the state will assign you a filing schedule.
Step 4: Connect sales tax to your website checkout system
Every major website builder has built in sales tax tools.
Squarespace
Shopify
Wix
Etsy
PayPal
Stripe
In your settings, turn on automated tax collection.
Connect it to the state where you are registered.
Make sure physical product pages are marked as “taxable.”
Important Tips
Digital products are taxed differently depending on the state
Some states tax digital downloads
Some do not
Some only tax them if they are interactive or contain audio
Always check your state’s digital product tax rules if you plan to sell
ebooks
templates
digital guides
courses
downloads
If you sell in multiple states
You may need additional permits depending on where your customers are located and where your business has sales tax nexus.
Nexus means a connection to a state through sales or physical presence.
This becomes important once you grow, so start by focusing on your home state first.
Keep track of your filing schedule
Some states require monthly filing
Some quarterly
Some annually
Missing a filing can cause penalties even if you had zero sales tax collected that period.
Summary
Sales tax seems complicated at first, but once you understand the basics, it becomes simple.
You collect it at checkout, hold it safely, and submit it to your state on schedule.
Here is the quick breakdown
Sales tax is paid by the customer
You must have a permit to collect it
You register through your state
Your website collects it automatically
Digital products require special attention
Staying compliant from the start keeps your business safe and ready to scale.
7. Home Based Business Basics
Most people start their business from home. It is affordable, flexible, and completely normal. Many six and seven figure businesses started at a kitchen table, in a spare room, or in a garage. Working from home is allowed in most areas, but there are a few guidelines to understand so you stay compliant and organized.
This section explains what you can do from home, what to check first, and when it might be time to move into a commercial space.
What You Can Do From Home
Home based businesses are extremely flexible. You can run almost any low risk business from your house as long as you follow your local rules.
Online businesses
Digital products
Ecommerce stores
Affiliate marketing
Dropshipping
Print on demand
Blogs and content sites
Content creation
YouTube
TikTok
Podcasting
Influencer work
UGC content creation
Consulting services
Coaching
Business consulting
Virtual assistant work
Freelance creative work
Copywriting
Social media management
Service based businesses
Tutoring
Graphic design
Branding
Web design
Bookkeeping
IT services
Product shipping and storage
Selling handmade items
Storing inventory
Packing and shipping orders
As long as you are not bringing heavy foot traffic, hazardous materials, or loud operations into a residential area, most home businesses are allowed.
Things to Check Before You Start
Even though home based businesses are common, it is important to make sure you are following your local rules.
Your lease or rental agreement
Many leases allow home businesses
Some restrict certain types of work
Check if your landlord has any rules about running a business inside the home
HOA rules if you live in a community
Some HOA communities limit
Signage
Noise
Customer traffic
Certain types of operations
Local zoning laws
Zoning rules determine what activities are allowed in residential areas
Search your city or county name plus "home based business" or "zoning guidelines"
Some cities require a home business permit for activities that involve storage, equipment, or regular deliveries
Insurance Considerations
If you operate something high traffic or high risk, you may need
Home business insurance
Product liability insurance
Professional liability insurance
This protects you if something goes wrong
Most online and service based home businesses do not need special insurance beyond general liability, but always check your specific industry.
Why Home Based Businesses Are Great
Starting at home gives you major advantages, especially in the beginning.
Low cost
No rent
No utilities for a separate space
You save money and reduce pressure
Low risk
If your idea changes direction or grows faster than expected, you can pivot easily without being locked into a lease.
Flexible
Work at your own pace
Set your own hours
Adjust your environment however you choose
Easy to grow
You can scale from home before investing in a commercial space.
Many businesses stay home based permanently and remain successful.
When to Consider Moving Into a Space
Not every business needs a brick and mortar location. But some businesses eventually outgrow the home setup. Here are signs it might be time to move.
When you outgrow home storage
Your inventory takes over your home
Your shipping area becomes too crowded
Your equipment no longer fits comfortably
When you need a client facing location
In person meetings
Therapy or coaching clients
Beauty services
Photography studio
Workshops or classes
These often require a commercial environment for professionalism and zoning reasons.
When zoning rules limit operations
If your city restricts
Customer visits
Noise levels
Delivery schedules
Storage amounts
You may need a commercial space if your work no longer fits residential guidelines.
When your business income supports the upgrade
The move should make financial sense
A physical space is an investment
You should not go into unnecessary debt for a storefront unless your business requires it
Summary
A home based business is one of the easiest, smartest ways to start.
You save money, reduce risk, stay flexible, and grow at your own pace.
Just make sure you check your lease, HOA, zoning rules, and any insurance needs so your business stays compliant and protected.
Start small. Stay organized. Scale when it makes sense.
Your Bridge Forward
Starting a business feels complicated until you finally see the steps laid out in front of you. Once you understand the basics, everything becomes easier. You can make clear decisions, avoid mistakes, and move forward with confidence.
This guide gave you the foundation
How to form your business
How to get your EIN
How to choose the right structure
How to stay compliant
How to operate safely from home
You now have the clarity most people never get when they start.
Your next steps depend on where you want to go.
If you are focused on money and structure, explore
How to set up business banking and credit
If you are focused on building your online presence, explore
Website basics and digital setup
The Resource Hub will continue to grow with new guides, templates, and tools.
Come back anytime you want step by step clarity, support, or a refresh on the basics.
You are building something real. Take it one step at a time.