Gone are the days of post-college grads who aspire to climb the corporate ladder in hopes of a corner office and a CEO position at a multinational conglomerate; these days, the dream for the millennial generation is a laptop and a co-working space, from which to run his or her own business. One of the leading drivers of economic growth, especially here in Tampa, is entrepreneurship — so much so, the term “Tampreneurs” was born!
And who’s in the driver’s seat? Millennials (aka Generation Y). According to a recent study, nearly two-thirds (67%) of this demographic aim to start their own business. In other words, the millennial generation is shaping the modern workforce.
But here’s what the majority of this percentage doesn’t realize: it’s not just a laptop and a dream. Starting a business is similar to driving through fog: you can easily lose your direction if you’re not careful. You must have a solid roadmap in place. Because the law can be so confounding, the legal requirements, quite truthfully, are best left to the professionals. (Hey, they did go to law school!)
According to Natalie Roberts, founder of Tampa-based Flagship Law, the success of your business lies in these areas: legal, insurance, financial, tax. Below are the three steps every future entrepreneur needs to take to launch their business.
1. Choose Your Company’s Legal Structure
First you will need to select the most suitable entity for your business. An S corporation may provide the best tax advantages, while a C corporation may provide the best protection from personal liability. “Until recently, Limited Liability Companies (“LLCs”) have been the most popular choice of entity for both tax and asset protection reasons,” says Roberts. “However recent judicial decisions have eroded the level of asset protection afforded by LLCs in some states. And the recent federal tax reform act has made entity selection all the more important in terms of income tax considerations.” Your choice of entity will determine the full range of legal documents that will also be required– including materials relating to contracts with co-owners and third parties, employment, intellectual property and tax/accounting.
2. Register Your Business
Once you have decided on an entity, the business must be registered with the state government. Depending on the entity selected, you may need to file articles of incorporation with your registration application. You will probably need to apply for an employer identification number and necessary licenses. These vary by both state and industry. You will need to obtain a taxpayer identification number from the Internal Revenue Service.
3. Assess Financial, Insurance and Tax Requirements
Of course, in any business, you have to talk money. It’s essential to explore the best options when it comes to capitalizing your business, whether via private financing or loans. Once you know where your financing is coming from, you then need to determine the best way to allocate funds in regards to business finances, insurance and taxes. What does your business need to have in place now in order to succeed in the long run? Accurately mapping these out could save entrepreneurs a bundle in the long run
Overwhelmed? Don’t be. Flagship Law offers an Entrepreneurial Package that includes registering the company with the State of Florida, obtaining a taxpayer identification number from the IRS, and consulting on the essential requirements for your venture — and for one flat affordable fee. Now that’s a savvy business decision!