o you decided to start a business - congrats! But now what do you do?
Here’s an outline of steps you do (In order! do not skip the order!)
Determine legal structure & file necessary paperwork. Sole proprietor? LLC? C-Corp? There are many options to choose from and it’s imperative to choose the RIGHT one for your situation, this step is definitely worth consulting an attorney with if this is your first business.
Get an EIN with the IRS (it’s free). You’ll need to put the name and type of business structure when you apply, which is why you have to do step 1 first.
Get a business bank account. This isn’t only necessary for liability purposes (if you’re choose a separate entity for your business), but also to keep your accounting records clean. It’s a huge PITA to have to separate the two, and keeps you from having accurate, up-to-date records.
Set-Up State Employer account. This is if you plan on hiring employees and is the payroll account you will establish with the state your employee(s) are located in, which will also you to remit payroll withholding taxes.
Pick a payroll platform. There’s many options out there (ADP, Gusto, Patriot, etc) but it’s going to save you a lot of time and headache to get on a platform that allows you to electronically pay your employees and send in required payroll reports to the government.
Pick an accounting system. As with payroll there’s many different accounting options ranging in pricing (Wave, Freshbooks, Xero, QBO, to name a few), but you’ll need a way to accurately track the income & expenses associated with your business. Not only do you need these numbers for tax purposes, but are also needed if you want to perform any type of analysis on the performance of your business model.
If this all feels overwhelming - there are service providers who can assist you every step of the way.
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