1. Figure out the important information
One of the very first things you need to do is check if your business name is available. All 50 states have databases where you can do this, usually on the secretary of state’s website. You also need a business address, the names of all the business owners, and the type of organization you want to be. Most staffing firms are LLCs or S Corps.
2. Create your guiding documents
While LLC operating agreements are not filed with the state, you do need them as internal formal guidelines – especially if you have more than one owner. They are also required in California, Delaware, Maine, Missouri, and New York. This document outlines your companies ownership and how your company will handle disputes, dissolution, and more. You can create these documents yourself via online template or you can hire a lawyer to draw them up.
3. File your paperwork
First, you must choose a state in which to file. Typically, it will be where you primarily operate. In most states, you will have several ways to submit your articles of incorporation which will be outlined in the secretary of state’s website. The info required on the forms varies state to state, but typically you will need to fill these fields out:
- Company name
- Mailing address
- Names and addresses of directors and officers
If you are unsure of a field, rather than leaving it blank, contact the agency in charge of forming business entities in your state. If for some reason you need your LLC formed fast, in most cases you can pay a fee for an expedited turnaround.
4. Document the funding
After you have filed your articles of incorporation with the state, get together with relevant parties and hold a meeting where you record the names of the people who exchanged money, assets, or services for partial ownership as well as the percentage of the company each person owns. This documentation typically appears on the operating agreement for LLCs and in the bylaws for corporations. LLC members can receive membership certificates, and corporations can issue stock certificates.
5. Get an EIN
After your get incorporated, it’s time to get an EIN. Most businesses need a federal employer identification number (EIN or FEIN) for tax purposes. The process is fairly painless if you apply online at the IRS website. You’ll be asked for your social security number, what kind of business entity you formed, and your fiscal calendar year.
You are now ready to start the process of incorporation! Hopefully these tips helped you understand the process a little better. If you have further questions or want to know how payroll funding can help your startup firm succeed, contact me anytime! We have 20+ years of experience helping staffing startups grow.