So, you’ve made a solid plan and are ready to get cracking and start that dream business like you’ve always wanted. That’s an admirable pursuit, and one of the most rewarding journeys you can go on for sure.
As you begin to put things in place over the coming months, though, it’s important not to get carried with the grand idea – there’s a lot of paperwork to get through first to make your dreams become a reality, and in many cases, these bits of paper serve as a foundation for your business. Here are three crucial applications you need to fill out to get started.
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Your Business License Application
Your first port of call so far as important documents go is a business license application. This application grants you the legal right to operate within a specific area, and verifies that the business and its operations are in compliance with local laws and regulations.
The actual requirements detailed in the application will vary from place to place, and may also be different depending on the specific industry you’re in. It’s common for your application to be tied in with certain permits – for example, if you run a catering business, the health department will be involved.
The Employer Identification Number (EIN)
The employer identification number is issued by the IRS. It’s a nine-digit number that is essential whether you have employees or not. It’s usually required to set up a business bank account (which you’ll need for a variety of reasons), and it’s necessary for filing taxes. If you do hire employees, you’ll also use it for tax information pertaining to your staff.
Applying for an EIN can be done online and is nice and straightforward. During the application, you’ll be asked a series of questions about your business structure, the primary purpose of your operations, key details about the owner, and so on. It doesn’t take long to receive your number, but it’ll prove to be one of the most valuable set of nine digits to be associated with you!
The Sales Tax Permit
If you’re planning on selling goods or taxable services, then you need to apply for a sales tax permit before you do so. This document enables you to collect and remit sales tax to your state’s revenue department, and while the exact rules differ depending on the state, it’s an essential requirement to register.
The application takes place at the state level. You’ll need to visit your state’s tax agency website and tell them about your business (you’ll also need to provide your EIN, so be sure to get that sorted first). Not registering for your sales tax permit can incur hefty fines and severe legal penalties, so make it a priority!
Wrapping Up
There are many other pieces of documentation you’ll need to pay attention to, but these three are a great start. Be sure to reach out to your local authorities for more information, and make sure you fill these applications out very carefully. Do things correctly the first time, and you can focus on the fun parts of running your business!
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