The USA has become home to nearly 33 million thriving small businesses in 2023.
Starting a company in the USA is more available than most people imagine. The total cost to register a business runs nowhere near $300. Anyone can start their business venture without a US partner or visa, regardless of citizenship status.
Business registration might seem daunting at first. This piece guides you through each step of the process. You will learn everything needed to launch your US company successfully – from selecting the right state to incorporate to understanding the new FinCEN requirements coming in 2024.
The growing community of US business owners awaits you. Let’s explore these simple, useful steps together.
Planning Your US Company Registration
You need to think about several key factors before starting your business registration. We needed to make three significant decisions: choosing your business structure, picking the right state, and understanding the costs involved.
The biggest decision is whether to form an LLC or a corporation. An LLC has more flexibility in management and taxation while protecting your personal assets. Corporations work as separate legal entities and give the strongest protection but need more record-keeping and operational processes. They face double taxation unless they qualify for S-corporation status, while LLCs can choose their tax treatment.
The right state for registration depends on several factors. These are the vital points to consider:
- State tax implications and filing fees
- Privacy laws and disclosure requirements
- Legal system and business regulations
- Physical presence and operational needs
Your business activities in a state determine if you need to register there. This means having a physical location, regular client meetings, or employees working in that state. Most states ask you to register through the Secretary of State’s office or Business Bureau.
The total registration cost runs nowhere near $300 for most businesses. You’ll need this simple information:
- Business name and location
- Ownership structure
- Registered agent information
- Number and value of shares (for corporations)
Each state has its own timeline. Some let you register online while others need paper documentation through mail. You’ll need a registered agent in your state before filing because they receive official papers and legal documents for your company.
Essential Requirements for Opening a Company
Registering a company in the USA depends on three key components: proper documentation, visa requirements, and registered agent setup.
Documentation Needed for Registration
The registration process starts when you file formation documents through your state’s Secretary of State office or Business Bureau. We filed a business name registration form and got an Employer Identification Number (EIN) from the IRS. Your business’s EIN works like a social security number and you’ll need it for taxes and banking. Most businesses complete their registration for less than $300.
Understanding Visa and Residency Requirements
Non-US residents can own and run a US company without living in the country. Working within the US needs proper visa authorization. Business owners have these main visa options:
- E1/E2 Visa: For treaty traders and investors, renewable every five years
- L1 Visa: For international companies expanding to the US, valid for 3 years initially
- EB-5 Visa: For investors contributing $500,000 to $1 million and creating 10 jobs
Setting Up a Registered Agent Service
Your company’s registered agent acts as the official point of contact for legal documents and state communications. You must have one whenever you register a new corporation or LLC. The agent needs a physical street address in your registration state and must be available during business hours.
A registered agent receives annual filing notices, handles service of process documents, and keeps compliance records. Professional registered agent services protect your privacy by keeping your home address off public records and manage your critical legal documents properly.
Step-by-Step Company Registration Process
The actual registration process has three main steps after you select your business structure and state.
Filing Formation Documents
You start by submitting formation documents to your state’s Secretary of State office. Each state has its own process. Some states let you register online while others need paper documents by mail. The state will send you a business certificate that confirms your registration. Some states might ask for extra reports within 30-90 days after you register.
Getting an EIN (Tax ID Number)
The IRS provides a free online EIN application service that works best for US-based businesses. The system will verify your information and give you an EIN right away. International applicants can call a dedicated phone line (267-941-1099) that operates from 6 a.m. to 11 p.m. Eastern Time.
Opening a US Business Bank Account
Your EIN lets you open a business bank account. Banks typically need:
- Articles of incorporation or organization
- EIN confirmation letter
- Company director’s photo ID
- Proof of business address
Large national banks like JP Morgan Chase, Bank of America, Citibank, and Wells Fargo are great options for new businesses. You can start your application online with some banks, but most need you to visit in person to finish the process. This will give a proper verification and helps build a professional banking relationship.
Post-Registration Setup Requirements
Your company registration is complete, but you still have important work to do. You just need to get the right licenses and permits to operate legally.
Business Licenses and Permits
Most businesses need a general business license from their local government. Your industry and location determine which permits you need. Common permits include:
- Health permits for food-related businesses
- Fire department permits for public assembly spaces
- Environmental permits for activities affecting air or water
- Sales tax permits for selling goods or services
- Professional licenses for specific occupations
State-Specific Compliance Requirements
Each state has its own rules to keep your business in good standing. Corporations and LLCs must submit annual reports to their state’s business entity filing office. Most states also charge franchise taxes or fees with these annual reports. Your business privileges could be revoked if you miss these requirements.
Setting Up Business Operations
Federal rules require businesses with 50 or more employees to report health coverage to the IRS. You’ll need proper systems to track transactions, employee information, and key documents. The Small Business Administration (SBA) can help you create efficient operational processes.
Your business operations should cover employee benefits, supply chain management, and insurance coverage. You must follow your state’s employment laws about minimum wage and overtime. If you sell products in multiple states, you’ll need systems to collect and report sales tax in each area.
Conclusion
Starting a company in the USA creates great opportunities for domestic and international entrepreneurs. The simple registration process, low costs, and flexible ownership options make the US market available for new business ventures.
A successful business needs careful planning and attention to detail. The right business structure and state for registration are the foundations of your company’s future. It also helps to keep proper documentation, get required permits, and meet compliance requirements so your business runs smoothly within legal boundaries.
Take time to research each step really well before you start the registration process. Note that setting up and running your US company will need commitment, but the potential rewards make it worth your effort. Your success comes from making smart decisions and following state and federal regulations.
FAQs
Q1. What are the basic steps to open a company in the USA? The basic steps include choosing a business structure, selecting a state for registration, filing formation documents, obtaining an Employer Identification Number (EIN), and opening a business bank account. You’ll also need to secure necessary licenses and permits, and comply with state-specific requirements.
Q2. How much does it typically cost to register a business in the USA? The total cost to register a business in the USA typically runs less than $300 for most businesses. However, additional costs may vary depending on factors such as the state of registration, type of business, and required licenses or permits.
Q3. Can non-US residents open a company in the USA? Yes, non-US residents can own and operate a US company without residing in the country. However, working within the US requires appropriate visa authorization. There are various visa options available for business owners, such as E1/E2, L1, and EB-5 visas.
Q4. What is a registered agent and why is it important? A registered agent is your company’s official point of contact for legal documents and state communications. They must have a physical street address in your registration state and be available during standard business hours. A registered agent is crucial for maintaining compliance and managing important legal documents.
Q5. What are some ongoing requirements after registering a company in the USA? After registration, businesses must file annual reports, pay franchise taxes or fees, and maintain good standing with the state. Additionally, companies need to secure necessary licenses and permits, comply with state-specific employment laws, and establish proper record-keeping systems for transactions and essential documents.
