Being an entrepreneur, you have spent most of 2020 brainstorming pandemic-proof business ideas. Now that it is a new year, you are ready to put your new business into action. Here are five simple steps to get started with a new business project. Alabama law tries to enable small businesses to begin operating without having to deal with a lot of obstacles or red tape, but it is still a good idea to work with an Alabama business & corporate litigation lawyer from the beginning of the process.
1 Put Your Ideas in Writing
Lots of small business owners scramble to write a business plan when applying for a business loan, because many lenders require them. You can save a lot of time and stress by writing one before you even incorporate your business. You might think of business plans as a purely academic exercise that people have to do in business school and that business plans written in advance are impossible to implement. You may find that, when you apply for a loan, you need to make changes to the business plan you wrote at the outset, but you will at least have a first draft, and modifying it will be easier than writing a business plan from scratch.
2 Apply for a Tax ID Number
Your business official exists once it applies for a tax ID number. Also known as an employer identification number (EIN), it functions much like a social security number for your business. When you apply for an EIN, you will need to specify your entity type on the application. Some examples of entity types include corporation, partnership, LLC, and sole proprietorship.
3 Make Your Business Name Official
When you apply for an EIN for a corporation or LLC, you must make sure that there are no other businesses with the same name registered in Alabama; your business name becomes official as soon as you apply for an EIN. For other entity types, you can register your business name with the Secretary of State after getting your EIN. This is optional for sole proprietorships and single-member LLCs if these businesses do not employ workers other than the owner, but businesses with non-owner employees must register their business names,
4 Open a Business Bank Account
Once you have an EIN, you can open a bank account for your business. Not all sole proprietorships have bank accounts separate from the owner’s personal bank account.
5 Get the Required Licenses and Permits
Almost all businesses need permits and licenses, but which ones they need varies according to the nature of their work and the county in which they operate. It might seem like a big expense to get all the required permits, but operating without them can be even more costly, especially if your company becomes a defendant in a lawsuit.
Let Us Help You Today
A small business attorney can help you get your new business venture off the ground. Contact Cloud Willis & Ellis for help.