Think of the coast line, sunshine, movie stars, and rolling hills with large homes. Are you imagining California yet? Now, keep the images going with the addition of a new business. Are you smiling? I am. It can happen. The important part is to know the steps in making the dream a reality. Once that process is complete, take a trip to the bank for an account. Finally, consider becoming incorporated and what that entails in the state of California. Let’s look at the process of getting started.
A business requires more than just the idea to get off the ground. The idea is the very beginning. A successful business is the finish line. Here is the details of the in between.
- Evaluate the business concept and research the market. The research will help to validate the idea.
- Make a business plan. Include an analysis of projected start-up costs.
- Gather basic business needs. Such as:
- Federal Tax ID number.
- License and permits. These are required for most California businesses.
- Contracts, invoices, service agreements, letterheads, and business cards.
- Marketing plan and website.
- Determine a location.
This may seem like a pretty good start, but there’s still more to come. Let’s take a trip to the bank.
Time for the Bank
The bank has multiple things a new business needs. There is a bank account, financing, and credit. Start with the basic, the banking account. Have that Federal Tax ID number on hand. It’ll be required. Don’t go to any bank and open any account. Remember that a bank is a business too. Do your homework and hunt for the best interest rates. High yielding accounts are attractive for businesses. Research the terms and make sure that they are agreeable. Some accounts require maintaining a large balance. This may not be feasible for some businesses. Most banks offer amenities for opening accounts with them. They may offer free payroll processing or safety deposit box. Avoid limited time offers. They usually come with a catch.
Rules to Become Incorporated
California isn’t the only state where becoming incorporated can protect an individual’s liability. However, it’s important to know California’s rules. To become incorporated, a business must have 3 directors. If no shares have been sold, 1 or 2 is acceptable. An Article of Incorporation should be filed. It will contain officer names and addresses, stock information, and contact information for a registered agent. Within 90 days, a Statement of Information needs to be filed. A biennial tax franchise will also be collected with annual reports. These rules are comparable to other states.
Starting your own business is an adventure all on its own. Taking that adventure to California can be even better. Remember to investigate and keep up to date with all the rules and legislation concerning being incorporated. Know the process to getting started and the services that will benefit the business. Put all the pieces together and the opportunity for success won’t be far.