Once your idea has taken shape and a few people have said yes, the practical questions arrive. Do I need to register? Which bank account? How do people actually pay me? These steps can feel intimidating because they sound official. In practice, most of them are forms and decisions you can work through one at a time.
This guide gives you the lay of the land, so you know what to look into and what to ask. Think of it as a map, not a set of instructions.
1. Choose a basic structure
The structure is how your business exists in the eyes of the law and the tax system. The common options for people starting out include:
- Sole proprietorship: you and the business are treated as the same. Often the simplest way to start, with little formal setup in many places.
- Partnership: similar, but for two or more people running a business together.
- Limited liability company (LLC): a separate entity that can offer some separation between business and personal matters. Usually involves state filing and fees.
- Corporation: more formal, with more paperwork. Usually considered later, if at all, by people at this stage.
There is no universally right answer. The best choice depends on your risks, plans, income and state. Many people start simple and change structure later. This is a great question for an accountant or a local business support centre before you file anything.
2. Register what you need to
Depending on your structure and location, registering might include some of these steps:
- Filing with your state if you form an LLC or corporation
- Registering a trade name, sometimes called a DBA, if you trade under a name that is not your own legal name
- Getting an Employer Identification Number (EIN) from the IRS if your structure or bank requires it
- Checking whether your city or county needs a general business license
- Checking for specific permits, for example for food, home-based work, childcare or events
- Registering to collect sales tax if you sell taxable goods or services in your state
Your state's official business website is usually the best starting point. Many states have a simple checklist for new businesses. Your local library or a nearby business support centre can also point you in the right direction for free.
3. Separate your money
One of the simplest and most useful things you can do early is keep business money apart from personal money. It makes it far easier to see whether you are making a profit, keep records and prepare taxes.
- Open a separate account for the business. Some banks offer accounts for sole proprietors; LLCs typically need formation documents and possibly an EIN.
- Run every business sale and expense through that account.
- Pay yourself by moving money from the business account to your personal one, and note it.
- Keep receipts, even photos on your phone, for everything you spend.
4. Decide how people will pay you
Make paying you as easy as possible. The right option depends on where and how you sell.
Selling online
Marketplaces like Etsy and Amazon handle payments for you, in exchange for fees. If you sell from your own site, an online store builder or a payment provider can process cards for you. Compare the fees, how quickly money reaches your account and what happens with refunds.
Selling in person
A card reader that connects to your phone is often enough for markets and pop-ups. Keep a small amount of change for cash, and consider a printed QR code that links to a payment page.
Selling services
Simple invoices or payment links work well. Decide your terms upfront: do you take a deposit, when is the balance due and how do you handle cancellations? Put it in writing, even in a short email.
5. Keep simple records from day one
You do not need complicated accounting to start. You do need a habit. Once a week, note what came in, what went out and anything you still owe or are owed. A spreadsheet or basic bookkeeping app is plenty at first. When things get busier, an accountant or bookkeeper can help.
6. Think about protection
Depending on what you do, you may want to look into insurance, such as general liability for markets or professional liability for advice-based services. Some venues require it. A short written agreement for service work also protects both you and your client by making expectations clear.
A simple order to work through
- Choose a structure, ideally after a quick chat with a professional
- Check your state and local registration and license needs
- Get an EIN if you need one
- Open a separate business account
- Set up the payment methods that fit how you sell
- Start a weekly record-keeping habit
- Look into insurance and written agreements
Take it one item at a time. None of this needs to happen in a single weekend, and it is fine to ask for help. The goal is a setup that lets you take money confidently and keeps you organised as you grow.