Paperwork for Starting a Small Service Business

By Contributing Writer

  • Overview

    Starting your own small business providing services to clients is an exciting adventure to undertake. To ensure success, you need to make certain you are aware of and follow the proper steps required to begin any small business in your area; this includes standard small business paperwork. You can begin your search by contacting your local Small Business Administration office. They will be able to direct you to the proper offices, phone numbers or websites that will have the contact information for your specific location. The information listed below will assist you in knowing what to ask for from each of the agencies.
  • Federal Permits/Licenses

    To begin, you will need to determine if federal permits or licenses will be needed for your business. Most small businesses do not need Federal permits or licenses. Those businesses that will include: • Investment advisors • Meat production • Alcohol • Tobacco • Firearms • Regulated services,such as radio, television and telephone • Drugs or biological product production
  • License Fees/Taxes

    Special Licenses and Permits There are a number of services that will require a license, bonding or certificates of competency in order to provide those services. Your state's department of commerce will be able to provide information about obtaining those special licenses and permits. City or Local Licenses and Permits You will need to contact your city or county offices to obtain information on the requirements to operate a business in your area. You can begin your search with a phone call to your tax collector's office. They will be able to direct you about the license and permits you will need. Examples of those license and permits are: • Privilege License: This is for all for-profit businesses in the city. This permit must be obtained prior to you starting to provide your services. • Zoning: You will need to contact the zoning office to determine whether or not you can have a home- based business in your home. Some areas do not allow commercial businesses in residential areas. If you live in a subdivision or gated community you may find the communities bi--laws are more restrictive than the zoning requirements. You will have to abide by the most restrictive regulations. • Signs: If your business will require you to have a sign in your yard; you will need to research the regulations regarding the size limits for the signs. Some communities will not allow commercial signs in residential areas.

  • Income Tax and Payroll Tax

    You will need to contact the Internal Revenue Service (IRS) to obtain the paperwork necessary to file state and federal income taxes. You can go to for all federal tax forms. The IRS has made it easier for a new business by providing a "Getting Started" package with all the necessary forms. You will also need to contact your state's department of revenue for state tax forms. Most state websites will have copies of the forms needed available to download. Payroll taxes will be needed if you are going to have any employees other than yourself. You will need to contact the IRS and your state's websites for copies of W4, I-9, and information on how to contribute to Social Security (FICA), federal onemployment tax and state unemployment tax. The good news is that the federal "Getting Started" package has the information and forms you need. Other Taxes There are a variety of other taxes that you may be responsible to pay. Your state's department of revenue will be able to tell you if you are required to pay any such taxes.
  • Incorporating a Business

    As you are setting up your business, you may determine that you want to incorporate your business. There are many benefits to incorporation that you will want to investigate. If you decide to incorporate you will need to contact your state's secretary of state for the forms necessary to begin this process.
  • Assumed Name Act

    If your business is not going to be listed under your own name, whether as a sole proprietorship or partnership, you are required to do a name search. You will need to contact the county register of deeds for the name search. There may be a fee attached to this search.
  • Insurance

    Now that you have decided to be a small business owner, you will want to protect your business in the event of harm, such as: • Hazard insurance, which covers fire, wind, water, theft. • Fire insurance, which will provide compensation for the loss of and damage to your business property by fire. • Liability insurance, which provides protection in the event a client or prospective client is bringing a lawsuit against you for damages while on your property or from the use of your products or services. • Auto insurance, which is required by law for any vehicle used for business purposes. • Workers' compensation, which is required if you have three or more employees
  • Protecting Intellectual Property

    This last section is often overlooked and may contribute to the largest personal loss. Many times a new business owner may have brand new ideas for their industry. Your ideas and know-how can be considered the most valuable business asset. Intellectual property includes patents, trademarks, copyrights and trade secrets and need to be protected. To protect your assets, contact: • U.S. Patent & Trademark Office • U.S. Copyright Office • Your state's department of commerce (business names) • Your State's secretary of state, trademarks Beginning your small business service is exciting and rewarding; knowing how to begin makes that first step towards business ownership manageable.
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