Most legal problems with a new business don't stem from doing something wrong; they stem from doing things in the wrong order. Opening the bank account before getting your EIN, applying for the license before registering the company, starting to sell before obtaining your sales tax authorization. This checklist organizes the steps for opening a business in the United States in the correct order, one after the other, with the cost of each and why it matters. Print it out, stick it on the wall, and check it off. When you reach step 12, your business is legally ready to operate.
How to use this checklist
The steps are in order for a reason: each one depends on the previous one. You can't open a bank account without an EIN, and you can't get an EIN without having registered the bank. Skip one and you'll be backed into a mess.
Each state has its own specific rules, so use this as a general guide and confirm the details for your state with the official source. If you want the full context before you begin, read everything you need to know first.
The 12 steps to opening a business in the United States
- Verify that there is a market. Before spending a single dollar on paperwork, confirm that someone is actually willing to pay for it. Talk to ten real potential clients. If none of them are willing to pay, no amount of paperwork will save you. Cost: $0.
- Choose your legal structure. Sole proprietorship is the simplest, but it doesn't protect you: if you're sued, they'll go after your house and car. An LLC separates your personal assets from the business and is the right option for the vast majority. An S-Corp comes into play later, when profits are already high. Cost: $0 to decide.
- Check that the name is available. Look it up in the Secretary of State's database, check that the domain is available, and browse the USPTO's trademark database. Changing the name after printing everything is extremely expensive. Cost: $0 to $50 if you reserve it.
- Register the entity with the Secretary of State. It's the process that legally establishes your company. It's called Articles of Organization or Certificate of Formation, depending on the state. Cost: between $50 and $500 depending on the state. The complete step-by-step instructions are in how to open an LLC.
- Name your registered agent. This person receives legal notices from the state. They need a physical address in the state (not a P.O. box). You can be this person if you live there, or you can hire one. Cost: $0 or between $50 and $150 per year.
- Editor to Operating Agreement. Almost no state requires it, but almost all banks do. It defines who's in charge, how profits are divided, and what happens if a partner leaves. If you have partners, this isn't optional: it's the document that prevents a friendship from ending up in court. Cost: $0 if you do it yourself.
- Saca tu EIN. It's your IRS tax identification number and it's park for free on irs.gov. Note: If someone is charging you for this, they are charging you for a free service. Full guide at What is an EIN and how to get one for free?. Cost: $0.
- Open the business bank account. With your educational document, your EIN, and your ID. Mixing personal and business money is the fastest way to lose the legal protection you just paid for. If you don't have a Social Security number, you can use an ITIN: see How to open a bank account without an SSN. Cost: $0 at most banks.
- Get your licenses and permits. There are up to four layers of licensing: state, county, city, and industry-specific (food, construction, beauty, health). A general license does not cover your specific trade. Cost: from $15 to several hundred.
- Register for the taxes you owe. Sales tax permit if you sell products, state business taxes, and withholding taxes if you're hiring. Understanding which ones apply to you is key: we explain it in The 3 taxes every homeowner should understand. Cost: usually $0 to register.
- Get your insurance. General liability insurance is the minimum requirement. If you have employees, workers' compensation is usually mandatory. If you drive commercial vehicles, you need commercial insurance. An accident without insurance can shut down your business in a day. Cost: from $400 per year.
- Set up your accounting from day one. Use software or an accountant, but start from the first month. Keep all your receipts and create your tax calendar. Businesses that fail don't always sell little; often they simply didn't know how much they owed. Cost: from $20 per month.
The three steps that are most often skipped
Of the twelve, there are three that people often overlook, and these are precisely the most expensive. The Operating Agreement (step 6): it seems like bureaucracy until there's a disagreement between partners and nothing is in writing. Insurance (step 11): it gets postponed "until there's more cash flow," and all it takes is one accident to ruin everything. And accounting from the very beginning (step 12): starting in January with everything organized takes an hour a month; rebuilding an entire year's worth of records in April costs thousands and countless sleepless nights.
How much does the complete checklist cost?
Adding up all the mandatory expenses, a simple service business can be set up for between $500 and $1,500 depending on the state, not including equipment or premises. The LLC and licenses account for the largest portion; the EIN and bank account are free. If you want a line-by-line breakdown with three budget scenarios, check out " How Much Does It Really Cost to Start a Business in the USA ?" And for free advice in Spanish, the Small Business Administration has SBDC centers throughout the country.
Conclusion
These twelve steps are the difference between having a business and having a paperwork problem. None of them are complicated on their own; what complicates things is doing them out of order or skipping those that seem optional. Print this list, date each step, and work through them in order. In two or three weeks—less than most people think—you can have your business completely compliant and focus on what really matters: getting clients.
If you prefer not to deal with the forms and have someone do it right the first time, at Forma Tu Empresa we register your LLC, process your EIN and get you ready to open your bank account, with the whole process explained in Spanish.
