How to Start your own Business?
Building your own business from the ground up is an exciting opportunity, but it can also be challenging.
Follow the 10 steps from the Small Business Administration (SBA) to starting a business. You’ll learn about writing a business plan, determining the legal structure of your business, and more.
Avoid common mistakes and get advice from experienced small business owners who want to help. Local SBA partner organizations offer free access to mentors and trainers.
Type of Business Entities
Sole Proprietorship
A sole proprietorship is the simplest business entity, with one person (or a married couple) as the sole owner and operator of the business. If you launch a new business and are the only owner, you are automatically a sole proprietorship under the law. There’s no need to register a sole proprietorship with the state, though you might need local business licenses or permits depending on your industry.
Freelancers, consultants and other service professionals commonly work as sole proprietors, but it’s also a viable option for more established businesses, such as retail stores, with one person at the helm
General Partnership
Partnerships share many similarities with sole proprietorships — the key difference is that the business has two or more owners. There are two kinds of partnerships: general partnerships, or GPs, and limited partnerships, or LPs. In a general partnership, all partners actively manage the business and share in the profits and losses.
Like a sole proprietorship, a general partnership is the default mode of ownership for multiple-owner businesses — there’s no need to register a general partnership with the state.
C corporation
A C corporation is an independent legal entity that exists separately from the company’s owners. Shareholders (the owners), a board of directors, and officers have control over the corporation, although one person in a C corp can fulfill all of these roles, so it is possible to create a corporation where you're in charge of everything.
With this type of business entity, there are many more regulations and tax laws that the company must comply with. Methods for incorporating, fees, and required forms vary by state.
S Corporation
An S corporation preserves the limited liability that comes with a C corporation but is a pass-through entity for tax purposes. This means that, similar to a sole prop or partnership, an S corp’s profits and losses pass through to the owners’ personal tax returns. There’s no corporate-level taxation for an S corp.
Limited liability company
A limited liability company takes positive features from each of the other business entity types. Like corporations, LLCs offer limited liability protections. But, LLCs also have less paperwork and ongoing requirements, and in that sense, they are more like sole proprietorships and partnerships.
Another big benefit is that you can choose how you want the IRS to tax your LLC. You can elect to have the IRS treat it as a corporation or as a pass-through entity on your taxes.
LLCs are popular among small-business owners, including freelancers, because they combine the best of many worlds: the ease of a sole proprietorship or partnership with the legal protections of a corporation.
Steps to register your business
Register a patent or trademark
How to Register a patent? For more information click here!