DISCLAIMER: This commodity is for informational purposes simply, and doesn't found professional person legal advice. Oberlo is non liable to you lot in any style for your utilize or reliance on this article.

It's essential that ecommerce entrepreneurs know how to register a business, peculiarly at the offset of their entrepreneurial journey.

In one case your online store has been registered as a legal entity, yous'll exist protected if any of your customers, or competitors, decide to file legal action against you lot.

If yous're new to the concept of registering a business, the thought can be quite daunting. We've created this article to walk y'all through all the necessary steps which you'll need to consider when you're registering a small concern in the United states of america.

Y'all'll soon know how to register your business and get the stability and legal security which individuals who are just starting an online business need.

Don't wait for someone else to exercise it. Rent yourself and starting time calling the shots.

Get Started Gratis

Do I Need to Register My Business organisation?

Although yous tin can run a business without registering it, it's a good thought to incorporate information technology as your business concern grows. Registering businesses makes them official in the eyes of the government, and it ensures both your personal and business avails are legally secure.

Steps to Register a Business concern

Registering your business isn't complicated, simply information technology does require you to take the right steps. The procedure to register as a legal entity involves:

1. Naming Your Business

Every ecommerce entrepreneur volition need to have the first stride towards registering their business organization past deciding on a name for their online store.

It'due south essential that you come up with a memorable proper noun for your online shop– something which is going to grab the eyes of your audience and leave a lasting impression. Make certain that the name is related to your niche, and something which you'll be able to build a marketing strategy effectually.

Coming upwardly with a business name that will stand the examination of time tin can be catchy. Check out some of your competitors and analyze the types of names which they use. Brand a note of the ecommerce business names which you like and so recollect virtually how your idea compares with it. Does your idea stand out from the oversupply? If not, what can you lot do to make information technology unique? You tin also employ a business name generator to go ideas for your company proper name.


ii. Registering a Business Name

In one case you've come with an amazing proper noun for your ecommerce business you lot've already overcome one of the nigh hard parts of registering a business. It's critical to brand certain that your business name isn't already registered with the United States Patent and Trademark Part (USPTO). The USPTO will automatically pass up any registration for a business name that'due south already registered in their organization. You'll too lose any processing fees from the application.

To avert whatever of these issues, research your local business directories to verify if the business organisation name you'd like to utilise is available. You tin too utilize USPTO'due south complimentary tool to cheque if your business concern name is available.

Future-Proofing Your Business organisation Name

When you've found a memorable business proper noun that is bachelor, take some time to think about the long-term goals of your business concern. Practice yous think that the proper noun of your business organisation is future-proof? Volition it stand the test of time?

Attempt to avoid choosing a concern name which stems from a current trend. If you were to name your ecommerce business organization 'Selfie Stick Corporation' you may run across success initially, only how popular will your business exist in the next few years?

It's important to consider the staying-power of a proper noun before yous annals your business concern, as it'll be inconvenient to alter your name later on. Changing your proper name once you've created an established ecommerce business is a hassle legally, and can as well atomic number 82 to confusion for your existing customers.

3. Picking Your Business Entity

Afterward you've decided on a name for your ecommerce business, y'all'll need to cull the type of business entity which best fits your online store. There are ii main options; registering your business organisation equally an LLC, or incorporation. There are distinct differences between these 2 options, so we've broken down the fundamental points which you lot'll need to know and then you tin can make the best decision for your ecommerce concern.

LLC

Setting up your business as an LLC volition require less paperwork than it would if you were to incorporate, which means that you'll have more than fourth dimension to focus on getting your store off the basis.

When you've registered your concern equally an LLC, you won't be personally liable for any debts which your company accumulates. This ways that your personal assets like your savings, car, and business firm volition be completely safe if anything were to happen to your company.

Another benefit of choosing to register as an LLC is that y'all'll be able to rent your personal assets to your business. For example, if you run your ecommerce business from a abode part, you're able to merits that infinite every bit a business expense. You'll salve some extra money by doing this which you lot'll be able to put into other aspects of your concern.

Corporation

When almost call up of corporations they think of multi-million dollar companies with hundreds of employees, but incorporation merely ways that you'll develop from a sole proprietorship into a company which is formally recognised as a legal business entity.

There are two main options which businesses can choose when they are incorporating; registering equally an 'S' corporation, or a 'C' corporation. There are no prerequisites to registering equally either, information technology'south all downwardly to which option is improve for your ecommerce business.

Registering your ecommerce business as an 'Due south' corporation will give yous the choice of 'pass-through taxation', which means that your ecommerce business will not be taxed on a business organisation level. Instead, y'all'll pay income tax on the revenue that your ecommerce business concern generates, but not the actual business concern itself.

On the other hand, 'C' corporations are considered as a separate entity when it comes to taxation. This means that your ecommerce business will exist bailiwick to 'double-taxation', which means that yous'll be taxed on your business' profits and you'll still be taxed on your personal income.

Whichever structure yous choose for your business entity, blank in mind that it isn't prepare in stone. As your business organization matures you'll be able to move from one structure to another depending on the needs of your ecommerce business.

4. Choosing the State You'll Annals In

Take some time to consider in which state yous'll annals your ecommerce business. The revenue enhancement rates vary from state to land. Still, you aren't required to register in the state where yous operate your small business.

Registering a new business in a state which has low, or non-existent sales taxation rates makes a lot of sense equally it'll save yous money down the road. Amazon, 1 of the biggest online retailers in the world, takes reward of this choice .

Take a look through each state's revenue enhancement rates and decide which country is best to annals in for your business organization' goals and immediate needs. Some states take no sales tax, so they don't have a registration procedure. Examples include:

  • Delaware
  • Montana
  • Oregon
  • Alaska
  • New Hampshire

For other states, check with their local part to observe out what the registration process comprises.

5. Obtaining Your Business concern' Federal Tax Number

Obtaining Your Business' Federal Tax Number

You also need to register your business on a federal level. To do this, you'll need to obtain a federal tax number for your ecommerce business. Your federal tax number is also known as an employer identification number (EIN), and it'southward the equivalent of a social security number for your business organization.

As you'll be filing tax returns and submitting reports on your concern activeness, information technology's essential that you become a EIN number for your business. Without this number, you lot won't be able to submit your revenue enhancement forms to either the federal or the state government.

You lot can utilize online for your ecommerce business' EIN number. Information technology's a unproblematic awarding form and you lot'll exist able to become your EIN number on the same day that yous submit the online grade.

6. Opening a Business Bank Account

Banks in the US crave documents of modest business organization registration before they will allow you to open up up a concern bank account. It'south essential that ecommerce entrepreneurs know how to register an online business if they are looking to open a concern banking company business relationship.

Equally an entrepreneur, you'll notice that opening a business account is a great style to separate your personal finances from those which you lot'll exist using to fund your ecommerce business organisation. Having a business organisation account is also clever for taxation reasons– you'll be able to invoice sure payments and claim them equally concern expenses.

Opening a business account volition give you lot a articulate thought of the amount of money which your concern is costing each month, and y'all'll know the verbal amount of money which your ecommerce concern is making.

Information technology'll also give your ecommerce business more professional brownie. Customers will brand payments for orders to your business account, instead of your proper name. This stardom instills conviction in your client that your concern is legitimate.

How Much Does It Cost to Annals a Business?

There'due south no price to unofficially register a modest business, but you may have to pay sales tax depending on the state you choose to contain in.

Summary: How to Go About Registering a Company in 2021

Now that you've read how to register a business organisation yous can get ahead and become started on running a legitimate ecommerce business. Once you've completed the registration process nosotros've detailed in this article, your business will be considered as a legal entity. And you lot'll officially exist the owner of a professional business organisation.

In summary, here are the half dozen steps to register a business:

  1. Cull your business proper name
  2. Register with the USPTO
  3. Select your business entity
  4. Decide on the state you'll register in
  5. Obtain your Employer Identification Number (EIN)
  6. Open a business depository financial institution account

If you have whatever further questions regarding the legalities of registering a business in the U.s., just drop us a line in the comments section. Call back, all questions are expert questions!

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Is there anything else yous'd like to know more about and wish was included in this article? Let u.s. know in the comments below!