by Ed Yourdon
How to Start a New Business
Initial steps to setting up a new company (S-Corp, LLC) may include:
1. Reserve the name of the company or LLC with the Secretary of State office of the state where you wish to incorporate and pay the reservation fee to reserve your name.
2. Prepare and file an Articles of Incorporation for a corporation or an Articles of Organization for an LLC and pay the fee to file such articles.
3. Prepare the By Laws for a corporation or an Operating Agreement for an LLC setting forth the terms and conditions of operation of the entity under the rules of the applicable state.
4. File for a federal (employer identification number (EIN)), state tax identification numbers, and any applicable license(s) based on the products or services being offered by the corporation or LLC.
5. Prepare resolutions adopting the Articles of Incorporation/Articles of Organization, By Laws/ Operating Agreement, resolutions confirming the nomination of board members, officers, and/or members, as well as appoint personnel to obtain bank accounts, accountants, lawyers, licensing duties, and any other service or requirement necessary for establishing your particular legal entity.
6. Prepare shareholder and/or buy-sell agreements all shareholders of the corporation or members of the LLC.
7) Maintain all records for the corporation or LLC and file all applicable documents with tax, licensing and other federal, state, county, city and municipal regulatory bodies.
8. Contract in writing with all employees, independent contractors, and/or entities performing tasks or services for the corporation or LLC being mindful of ownership of intellectual property.
9. Maintain compliance with all employment, environmental, export, safety, tax, licensing, and all other laws and regulations governing the activities of the corporation or LLC.
10. Pursue protecting and owning all inventions, ideas, marks, logos, and works created, conceived and/or reduced to practice by anyone involved with the corporation or LLC.
This list of steps is not inclusive of all the legal requirements necessary to form and maintain an entity but rather represents a preliminary check list. Note many service providers offer incorporation services for a few hundred dollars, but in reality they are only offering the first two or three items listed above. The first purpose of setting up an entity is to provide you with limited liability, protecting your personal assets such as your home, car and 401k plan from the risks of starting a new venture.
Seek the advice of an attorney licensed in the state where you wish to incorporate and make sure such attorney meets with you and outlines a written summary for your specific entity.
Mat Grell, U.S. Patent Attorney – Founder of The Inventor Start Kit, a simple step-by-step process that helps inventors protect their ideas and get them to the marketplace… to hopefully make millions! Visit Mat’s site: http://www.inventorstartkitblog.com