5 First Steps to Registering Your Small Business or Freelance Side Hustle

I remember my very first startup.

The truth is, I didn't even know I was in business or even what a startup was at the time. What I did know was that my very first client needed my "business info" so they could add me to their accounts payable. And heck, I didn't even know what type of "business info" I was supposed to have.

That's the reason why I decided to write this post.

For the folks who may be in the same place or similar, who need to know a basic framework of what they might need.

Now, remember, before you go on, that every business is gonna have its nuances. This is written as a basic framework and also what worked for me at the time.

But I digress...

While it's common advice to wait until you start generating money to register your business, this can potentially lead to many mistakes and consequences down the road. Once you have a business idea, it is always best to get it registered to protect yourself and solidify your commitment to becoming an entrepreneur. In addition, waiting to register can prevent you from completing the necessary work required to succeed.

For example, you may need a business license to purchase insurance.

In the example I gave above, it was required for me to have an insurance policy from the get-go, so making it all official was a huge first step.

Here are the five general steps to follow to register your small business or freelance startup.

Step One: Find a business location

First, you must determine where you want your business to reside, even if it's virtual.

In this day and age, work from home, or #wfh, is all the rage. So deciding if you want your business address to be your home address may be the most straightforward first decision. There may also be some positive (or negative) tax implications, so be sure to check with a tax pro.

Whichever way you choose, home or virtual, there will be things to be aware of.

This will help determine what fees you need to pay and where to register your business. Each state has different requirements, fees, licenses, and permits to start, so be sure to do your research.

So let's move to the next point.

Step Two: Determine the legal structure

Sole proprietorship, corporation, limited liability corporation, or a partnership are the different legal structures.

This is a decision I would definitely recommend you research.

Since my day one and 20+ years and multiple startups under my belt, I've found a simple "LLC" to be the best fit.

But remember, what worked for me won't necessarily work for you and your work.

As an entrepreneur, starting as a sole proprietor is common, registering as a limited liability corporation. To be legal, most sole proprietorships only need to submit a DBA or "doing business as" name within the state.

Two things to note here.

seek professional guidance,

file what works for you and your situation

Step Three: Choose and register your business name

The name you file legally doesn't have to be the name you put on your website or business card.

For example, my current legal entity is "Life Pivot, LLC." But our forward-facing name is Life Pivot Media.

Of course, the names can be the same. This is just how we filed and operate.

Before legally operating under your business name, you must register it within your state and county. Your state and county website will have information and step-by-step instructions for correctly registering your business name. You can only do business under your legal name until you register your business name.

Step Four: Get an EIN or Federal Tax ID

Now, register for an EIN.

You can look at this website here to see if your business requires an EIN or employer identification number. If not, you simply use your social security number as your federal tax ID. Those who run a partnership or limited liability corporation must register for an EIN.

This step is cut and dry.

Step Five: Apply for licenses and permits

Finally, you must apply for local licenses and permits for your business or industry.

This step might be particular for the type of biz you'll be conducting.

It might vary wildly, especially as you could be a freelance writer, or a food truck, so permits can be a deal killer if you don't manage this part with detail and finesse.

Your county government website will be the best resource for figuring out this information. You can also contact your local business and professional regulations department for more information.

The final word

Starting your own gig, side-hustle or startup is scary enough in and of itself.

Registering your small business can be a daunting task too. Still, it's essential to do your research and get professional guidance to ensure you're doing everything correctly.

The five steps we've outlined are a great place to start but always check with your state and county government websites for more specific information. Also, don't forget to lean on mentors and other folks who have already done what you're doing. They might prove to be the best resource of all!

And good luck on your startup journey!

Grab the free weekly report that helps freelancers actually freelance.

Proven Strategies To Grow Yourself, Your Impact, And Your Business