The legal documents needed to start a business begin with a formation filing with your state (if you want an LLC or corporation), an Employer Identification Number from the IRS, a DBA registration if you’ll use a trade name, any licenses or permits your industry and location require, and internal agreements that spell out how the business is run and owned. Add employment forms once you hire. The exact stack depends on your business structure, where you operate, and what you sell.
Formation Paperwork With the State
If you want a limited liability company or corporation, you file a formation document with your state’s Secretary of State or equivalent office. For an LLC, it’s usually called Articles of Organization. For a corporation, Articles of Incorporation. Some states use different names: Certificate of Formation or Certificate of Organization for an LLC, Certificate of Incorporation for a corporation. The label changes; the function doesn’t. The filing creates a legal entity separate from its owners.
The document asks for a few standard items: the business’s official name, its principal address, and the name and address of a registered agent. The registered agent is the person or service designated to accept legal notices and government correspondence for the entity, and every state requires LLCs and corporations to keep one with a physical address inside that state.
Sole proprietorships and general partnerships skip this step. They exist the moment you start doing business, with no formation filing because no separate legal entity is being created. The cost is that the owners get no built-in liability protection.
Employer Identification Number
An EIN is a nine-digit number the IRS assigns to a business for tax reporting. You need one to operate a partnership or corporation, to hire employees, and to handle sales or excise taxes.1Internal Revenue Service. Get an Employer Identification Number An LLC needs an EIN if it has employees or elects to be taxed as a corporation. A solo LLC owner without employees can technically use a Social Security number instead, but getting an EIN keeps your personal number off invoices, contracts, and bank forms.
Applying is free and quick. You can complete the online application, which is based on IRS Form SS-4, directly through the IRS website in minutes.1Internal Revenue Service. Get an Employer Identification Number The form asks for the business’s legal name and address, entity type, and the principal owner’s name and taxpayer identification number. Avoid third-party sites that charge a fee. The IRS has made clear you should never have to pay for an EIN.2Internal Revenue Service. About Form SS-4, Application for Employer Identification Number
DBA Registration for a Trade Name
Operating under a name that differs from your legal business name means registering a “Doing Business As” name, also called a fictitious name or trade name. A sole proprietor named Jane Smith who opens “Sunrise Bakery” needs a DBA because the operating name doesn’t match her legal name. An LLC or corporation can also file a DBA to run an additional line under a separate name without forming a new entity.
DBAs are filed at the state or county level, depending on the jurisdiction. The filing usually asks for the assumed name, the registrant’s legal name, state of formation, and principal place of business. Most states require it, though a few make it optional for formal entities.
A DBA Does Not Protect the Name
Registering a DBA does not give you exclusive rights to that name. It’s public notice of who’s behind the business, which is what lets you open bank accounts and sign contracts under the operating name. It won’t stop anyone else from using the same name. For brand protection, federal trademark registration through the U.S. Patent and Trademark Office is the tool: a registered trademark gives you the legal right to prevent others from using a confusingly similar name for related goods or services nationwide. If you plan to operate beyond a single local area, consider applying for a trademark early.
Licenses and Permits
Most businesses need at least one license or permit on top of their formation paperwork. Requirements stack at the federal, state, and local levels, and missing one can mean fines or forced closure. What applies to you depends on your industry, what you sell, and where you operate.
Federal Licenses
Businesses in federally regulated industries need a license from the relevant federal agency. The SBA lists categories that trigger federal licensing, including agriculture, alcoholic beverages, aviation, commercial fishing, firearms, maritime transportation, mining and drilling, nuclear energy, and radio or television broadcasting.3U.S. Small Business Administration. Apply for Licenses and Permits A firearms dealer, for instance, must get a Federal Firearms License from the Bureau of Alcohol, Tobacco, Firearms and Explosives before buying or selling any inventory.4Bureau of Alcohol, Tobacco, Firearms and Explosives. Federal Firearms Licenses
State and Local Licenses
State licenses are common for regulated professions like cosmetology, real estate, and healthcare, and for selling alcohol or tobacco. Most states run a professional licensing board that handles applications and sets education or examination requirements.
Local governments add another layer. Cities and counties may require a general business operating license, health department permits for food service, zoning permits confirming your location is approved for commercial activity, or signage permits. The best starting point is your local city hall or county clerk’s office. Requirements vary widely, and a missed local permit is one of the easier mistakes to make.
Sales Tax Permits
If you sell taxable goods or services, register for a sales tax permit in each state where you have a taxable presence. That presence can be physical, like an office, warehouse, or employees in the state, or purely economic, triggered when your sales into a state cross a threshold. Most states set the economic threshold at $100,000 in annual sales, though the exact number and rules vary. Permit fees range from free to modest. Failing to register when required can lead to back taxes, penalties, and interest.
Internal Operating Agreements
Formation documents tell the state your business exists. Internal agreements tell the owners how it actually works. These stay private, not filed with any government office, but they’re legally binding and prevent most ownership disputes.
Partnership Agreement
A general partnership requires no formation filing, which makes a written partnership agreement all the more important. Without one, state default rules take over, and those defaults rarely match what the partners actually intended. The agreement should cover each partner’s capital contributions, profit and loss allocation, management responsibilities, and what happens when a partner wants to leave or the partnership dissolves.
LLC Operating Agreement
An operating agreement serves the same purpose for an LLC. It sets out each member’s ownership percentage, voting rights, management duties, and how profits are distributed.5U.S. Small Business Administration. Basic Information About Operating Agreements It also says whether members manage the LLC directly or a designated manager runs it. Even single-member LLCs benefit from one, because it reinforces the separation between the owner and the entity if someone later challenges the liability shield.
Corporate Bylaws
Corporations use bylaws to establish internal governance: how the board of directors meets, how officers are elected, what duties each officer holds, and how shares can be transferred. Bylaws are typically adopted at the first board meeting after incorporation and kept with the corporation’s other records.
Buy-Sell Provisions
Any business with more than one owner should consider adding buy-sell provisions to its operating agreement, partnership agreement, or bylaws. A buy-sell clause spells out what happens if an owner dies, becomes disabled, gets divorced, or just wants out. It typically requires the departing owner’s interest to be sold back to the company or the remaining owners at a price determined by a method the agreement specifies in advance. Without this, an ownership change can throw the business into uncertainty, particularly if a deceased owner’s interest passes to family members with no involvement in the company.
Employment Forms for Your First Hire
Hiring your first employee triggers a separate set of federal paperwork, and the deadlines are short. This is where many new employers slip up.
Form I-9
Every employer must complete Form I-9, Employment Eligibility Verification, for each new hire. The employee fills out Section 1 on or before the first day of work. The employer completes Section 2, which involves examining the employee’s identity and work authorization documents, within three business days of the hire date.6USCIS. Completing Section 2, Employer Review and Attestation If the job lasts fewer than three days, Section 2 must be done on the first day. Employers face civil and potential criminal penalties for failing to properly complete and retain these forms.7USCIS. Instructions for Form I-9, Employment Eligibility Verification
Form W-4
Each new employee also fills out IRS Form W-4 so you can withhold the correct amount of federal income tax from their pay.8Internal Revenue Service. Form W-4, Employee’s Withholding Certificate The completed form stays with you. Employees should submit a new W-4 whenever a personal or financial change affects their withholding.
New Hire Reporting
Federal law requires every employer to report newly hired employees to the state’s Directory of New Hires within 20 days of the hire date.9GovInfo. United States Code Title 42 – 653a State Directory of New Hires The report includes the employee’s name, address, and Social Security number, along with your business name, address, and EIN. States use the data primarily for child support enforcement and unemployment insurance verification. Some states set a shorter deadline than the federal 20-day window, so check yours.
Beneficial Ownership Reporting: Current Status
The Corporate Transparency Act, codified at 31 U.S.C. ยง 5336, originally required most LLCs, corporations, and similar entities to report their beneficial owners to the Financial Crimes Enforcement Network.10Office of the Law Revision Counsel. United States Code Title 31 – 5336 Beneficial Ownership Information Reporting Requirements As of March 2025, FinCEN issued an interim final rule that exempts all entities created in the United States from the reporting requirement. Only foreign-formed entities registered to do business in the U.S. must currently file.11FinCEN. Beneficial Ownership Information Reporting FinCEN has said it will not enforce BOI penalties against U.S. citizens or domestic reporting companies under this interim rule. The underlying statute still exists, so this could change through future rulemaking; check FinCEN’s website before assuming the exemption still applies.12FinCEN. Frequently Asked Questions
Keep the Entity in Good Standing
Filing formation documents is not a one-time event. Most states require LLCs and corporations to submit an annual or biennial report to the Secretary of State to stay in good standing. The report usually confirms or updates basic information: business address, registered agent, and names of officers or members. Fees range from under $100 to several hundred dollars.
Letting an annual report lapse is one of the most common and most avoidable mistakes. The consequence is administrative dissolution, meaning the state revokes your entity’s good standing, which can block you from enforcing contracts, closing real estate transactions, or getting approved by lenders. Reinstatement is usually possible but means back fees, penalties, and a gap in your legal status. Put the filing deadline on your calendar the day you form the entity.