Here’s a basic outline of what you’re going to need to form a new business.
Business plan. The first thing you need is to lay out your plan for the business. What are you going to sell, or what service are you going to provide? Who are your customers going to be, and how are you going to advertise to reach them? Are there already people that run similar companies? What are your qualifications, and why are customers going to choose you over someone else? Also, how much money are you going to need to get started, where is that going to come from, and how much do you reasonably think that you’re going to make?
Legal form. Who is going to own the business and what form will “it” take? Are you going to be a company (and thus “incorporate”) or will the company be an LLC, a partnership, or a sole proprietorship? There are various tax reasons to choose from that list, but also non-tax reasons that may affect who controls the company in the future.
Location. Where you are based is one of the essential components of your business. You’ll need to know the costs, such as rents and other utilities, and there will be zoning restrictions. Unless you exist solely in the online world, in which case your company can exist everywhere.
Permits and taxes. Find out who controls business permitting in your location. In New Mexico, the county clerk is usually where you want to go, but in Albuquerque there is a special entity called the Planning Department that handles business registration. After that, you’ll need to register with the IRS and other entities that handle taxation for your state, county and city. Some kinds of occupational businesses like restaurants, barbers, and massage therapists for example, need special licenses as well.
Advisors. To do this right, you’ll also want people around you that can provide good advice. Aside from an accountant like Tardy & Co., PC you’ll probably want a banker, an insurance agent, and an attorney. Involve your advisors early and often.
Business advice is one of the things that we pride ourselves in at Tardy & Co., PC. We can help you make good decisions about how to keep your books and take care of your billing, and it makes us incredibly proud when one of the new businesses that we advise really begins to take off.
If you’ve had a bad experience with an accounting firm that just throws numbers at you and can’t or won’t answer basic questions, you should know that we’re very different. If you’d like to know more, please contact us.