When you decide to start a new business in California, it’s important that you know what is expected of you at various levels of government to ensure your business is operating as soon as possible.
Whether you are starting a business in California or elsewhere it’s always a good idea to start with a business plan. This is your roadmap to success covering all aspects of your business. It’s like a blueprint that instructs you what you’ll do next.
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If you are trying to decide where your business should be located in California, you should contact the California Business Investment Services who are equipped to provide you site selection services tailored to your business. This can be an extremely helpful tool in narrowing down your options and finalizing the right choice.
There are a number of legal business structures including sole proprietorship, limited partnership, limited liability partnership, general partnership, and corporation. Each type of business structure has legal requirements and you should always talk with a California tax advisor and your legal counsel to determine which entity will best meet your needs and to ensure you have met your legal obligations.
Next you will need to file your tax and employer identification documents. There are a number of California agencies that administer different taxes. The following state agencies will be able to help you determine your tax obligations.
- Franchise Tax Board – Administers personal income, corporate income, franchise tax
- State Board of Equalization – Issues permits for sellers, administers state sales tax, fuel tax, tobacco tax, and alcohol tax.
- Internal Revenue Services – Issues Employer ID Numbers. You will require an EINs if you have employees, operate as a partnership or corporation, File a tax return for alcohol, tobacco, firearms, excise, or employment, withhold taxes on income that are not for wages, have a Keogh plan, or you are involved in trusts, estates, real estate mortgage investment, non profits, farmer’s cooperatives, or trusts.
- Employment Development Department – Issues employer account numbers, state ID numbers, SEINs, and reserve account numbers.
Almost all businesses require a license or permit to operate. For more information visit
Once you have obtained all necessary license, permits, and documents, and you have found your location you are ready to open your business. Of course you will need to ensure you have hired the necessary staff. After that you’re ready to become a successful entrepreneur.
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