So you want to start a business?
In deciding to start a business, one of your first steps (other than choosing a name) should be deciding on the business structure. Options include corporations, limited liability companies, partnerships, etc. Each one has different requirements and different pros and cons depending on the type of business and your particular situation, but the two main reasons to have a formalized business structure are to limit liability where possible and to minimize tax consequences for your business. If you simply start a business with no structure (commonly called a sole proprietorship) you are not taking advantage of all your options and are exposing yourself to greater risk. An attorney can discuss the various options with you and explain how each may impact your business.
Once you have made a decision and sent in the required paperwork and fees to the Secretary of State, there are still a number of items that you should discuss with an attorney.
First, you will need internal documents for your business, such as Bylaws for a corporation. If you have an LLC or a Partnership, I strongly recommend an Operating or a Partnership Agreement. Even if you are the only person in your business, it is good practice to have the appropriate documents completed not only for the legitimacy of your business but also in case anything happens to you so that others can carry on or wind up the business as you have designated.
On the financial side, once you have established a business structure with the state, you may want to use a Federal Employee Identification Number (FEIN) instead of your social security number for business purposes. It is also critical to keep your personal assets separate from your business assets, so you should establish a business bank account. Most banks will want to see your business formation documents as well, so that step should already be completed. Check with your bank about their requirements.
Next, consider whether your business requires licenses or permits. For example, if you sell taxable goods or services, you will need to be registered with the Oklahoma Tax Commission. If you have employees, you will need to be registered with both the Oklahoma Tax Commission and the Oklahoma Employment Security Commission. Depending on the type of business, there may be other permits or licenses needed as well, such as through the Department of Health.
Finally, consider areas where you may need outside assistance. Find a good insurance agent who understands commercial and professional insurance to help you determine the types of policies and level of coverage you need for your business. Hire an attorney to help you with the business formation and ongoing issues. Consider hiring a bookkeeper, accountant, and/or payroll service if you have employees.
As you can see, there are many steps to starting a business. Having a good business plan and professionals you can contact to guide you through the process can make it manageable and help you get your business up and running.
To schedule a consultation with me to discuss the specific needs of your business: 918-770-7810 or firstname.lastname@example.org.
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