When starting a business there are federal small business requirements that must be met by all start-ups. Both state and federal governments place certain requirements on small businesses in order for the companies to function properly. From a federal perspective, there are several major small business requirements that the government imposes upon businesses.
Business Structure and Taxes
One of the very first decisions of a business will be to decide what kind of business structure it will adhere to. The type of structure will determine how much regulatory paperwork the business will have to file as well as the taxes it will pay. The different structures for small businesses include:
The tax and regulatory implications of the various business structures increase the more the business heads toward being classified a corporation. Corporate taxes are more complicated than paying taxes on business profits and professional assistance from a tax attorney or accountant should be obtained. The specific tax forms required by the IRS for each of the above business structures can be found on the IRS website or the U.S. Small Business Administration site.
Employer Identification Numbers
Employer Identification Numbers (EINs) are typically required of all businesses (although most sole proprietors with no intent to hire employees are exempt - - check the IRS website to confirm whether your business needs to apply). An EIN is used by the IRS to identify a business entity for purposes of tracking the business and determining what taxes it and the parties related to the business (employees, suppliers, etc) owe the government. Businesses can now apply for EINs online, with the EIN being issued immediately during the application session.
Licenses and Permits
In addition to the requirement of obtaining an EIN, businesses in certain industries are required to apply for licenses and permits to do business. While a majority of businesses don't have to register with the federal government (but do with state agencies), if your business falls into the following categories, you should consult with the governing federal agency to determine whether you need a license or permit (see "Federal Business Licenses" for more information):
Naming Your Business and Protecting Your Property
Once you've decided on your business structure and determined whether the business falls under the purview of a federal agency, you'll need to choose a business name and see whether it violates another business' federally protected trademark. You can do a simple search with the U.S. Patent and Trademark Office (USPTO),as well as a search for similar businesses using internet search engines.
You may have already picked a business name, but because of the potential waste of time and money related to marketing a name that you ultimately can't use, you should take at least a few precautionary steps before plunging in. Additionally, once your business gets rolling, you should take steps to protect your business' trademark. You can register your business name with the USPTO even before you start using the name in business (it's called an Intent to Use application).
Additionally, if your business has any intellectual property, you'll want to protect it by registering it with the USPTO, whether they're patents, copyrights or trademarks. And after you've registered your property, you need to vigilantly protect it on your own (the USPTO isn't an enforcement agency).
Get a Free Initial Legal Review
While you may be a brilliant entrepreneur, trying to decipher all the federal business law requirements can be confusing. A skilled lawyer can help you meet all the requirements and save you hours of lost productivity. Contact a local attorney for a free initial legal review of your business plans to learn how they can help you execute your business schemes with aplomb.