How to Get Started on the Business of Business

As a general rule of thumb, new employer businesses have a 50/50 chance of surviving for five years or more, according to Brian Head, economist for SBA Office of Advocacy.

We recognize most people want to save money and do as much as possible themselves. That is why we put this list together to assist you in what seems to be an overwhelming list of choices for your business. After you go through this site and the related links to educate yourself, we still recommend you contact some professionals to get their expert guidance. This list is just a start in all the decisions you will need to make as you grow your business.

The following list gives a brief description of the many things you need to consider for your business. After each subject you will see (links) that will take you to other websites to get further details or to sign up for that particular topic.

• Choose the type of entity -Sole Proprietorship, Partnership, LLC, LLP, S Corporation, C Corporation. The LLC seems to be the most popular choice to obtain legal protection and still maintain flexibility. - link1, link2, link3
• Think about a business plan. History has shown that the 10% who set goals out perform the 90% who don’t. Spend some time making a complete plan, understanding your competition and trying to anticipate what can go wrong before you start. – link
• Multiple owners & buy sell agreements. Sooner or later when the honeymoon of starting a business is over you will have some disagreements. Decide now how things will work and decisions will be made when things go bad. – link1, link2
• Apply for federal ID number instantly online. Everything is tied to a number and the place to start is with the federal ID number. You can get it instantly online and you will need it for the banks and many other places. – link
• Register with federal government for Electronic Federal Tax Payment System (EFTPS). If you owe any taxes to the federal government you will probably need to register for their tax payment system. Here is where you go to do it. – link
• Register with the state for income tax, withholding tax, sales tax and/or use tax. Every business will need to register with the state. One application covers several types of taxes and you will be assigned a MITS number by Missouri that you will use when you file and pay the various state taxes. – link
• Register with Mo Secretary of State including business entity and possible annual registration requirements & fictitious name filing. In addition to registering for taxes, you also need to register your legal entity with the state. If you just want to register your fictitious business name, you are probably wasting your time because in MO up to 500 businesses can use the same fictitious name. If you want a loan in your business name and you have not formed a legal entity, you still may need to file this form. – link
• Payroll: If you will have employees, all the following links will be important to you. Note: If your business is taxed as a partnership, the partners or members of the business cannot be considered employees for payroll.
  • Register with state unemployment. This is one of the taxes you as an employer pay to cover employees when they lose their job. You will get another number assigned to you for state unemployment when you register. – link
  • Register with E-Verify to do required check of worker legal status. There are strict penalties that can be assessed against employers who hire illegal aliens. We suggest you register with E-Verify so you can check new employee social security numbers to make sure they are valid. – link
  • Understanding minimum wage law and various labor laws. There are many technical rulings in labor law. Often employers think by paying a flat weekly salary they can avoid paying overtime. This is rarely the case. Make sure you understand the laws. – link
  • Workers compensation insurance. Workers comp protects an employer from litigation by an employee for getting hurt on the job. For some occupations this insurance can be very expensive. Not all employers are required to have workers comp but make sure you know the rules and the risks before you chose not to pay. - link
  • Retirement plan choices. Most new companies won’t set up any retirement plan until after they see how profitable the business is. Once you decide to implement this employee benefit make sure you understand the fiduciary risk you take on as the business owner for each plan. - link
  • Labor posters. If you have employees you are required to notify them of their rights and the various employment laws by posting them at your workplace.
    • E-Verify participation : link
    • Federal Labor posters : link
    • State Labor posters : link
  • Hiring employees. There is a minefield of do’s and don’ts when it comes to hiring and firing. As a basic rule you need to treat everyone the same, but here are some suggested resources.
    • Credit & Background checks-General overview : link
    • Local company that does employee background checks : link
    • Web searches – do a search on following sites by typing in the job applicant name on- Google, Facebook, Twitter, etc.
    • Forms employee must fill out when you hire them. The following forms authorize you to withhold taxes from employee paychecks, provide proof of the citizenship status, etc.
      • Illegal immigrant: I-9 – link
      • Federal withholding: W-4 – link
      • State withholding: MO W-4 – link
    • Social security number verification- See E-Verify registration above
    • Interview questions. The goal is to have job applicant talking 80% of the time and the interviewer 20%. Here are some questions that will help you in this area. Just remember, as the interviewer, you never learn one thing when you are talking. – link
    • Interview-what you can and can’t ask. There are lots of questions you cannot ask because of various discrimination issues. As a general rule make sure the question relates to the job you are trying to fill. – link
    • Calculating payroll: Circular E After you hire someone you have to pay them and when you do you have to withhold taxes. This publication explains how you go about withholding taxes and paying them over to the IRS. – link
    • Employee or independent contractor. Many small business owners want to avoid the hassle of payroll by treating everyone as an independent contractor. There are very stiff penalties for this if the IRS finds those people should have been treated as employees. – link
  • Get W-9 from independent contractors before you pay. For those who are truly independent contractors you need each to fill out a W-9 form so you can give them a 1099 at the end of the year reporting to the IRS how much you paid each contractor. There are also stiff penalties for each 1099 form you do not file so make sure you read the rules for 1099s. – link1, link2, link3
  • Insurance-
    Understanding types of insurance. There are lots of types of insurance you can purchase to protect your business. You have a difficult choice between being broke because you insure against everything or deciding which risks you can afford to self insure and how you manage your business to minimize those risks. link
  • Quarterly estimated tax payments: 1040-ES If you make a profit in business, the federal and state government want their share. This is the form you use to send in taxes throughout the year for income where you had no withholding like wages. – link
  • Monthly tax due dates The Mo Dept of Revenue has put together a nice calendar that shows the due dates of all the various taxes you may be required to file. – link
  • Accounting books & records. A good set of records is a must for any business. If you intend to do it yourself, you might want to look at Quickbooks software to track your business financial information because it is the most widely used financial software on the market. Just remember the old saying—garbage in, garbage out. Even a good software program can produce a worthless set of books.

  This website touches mostly on compliance and tax issues of starting a new business. Once you master these items, you have all the other issues of marketing, management, sales, etc. It seems like the list is endless. The following link is just a partial list of those items – Startup Task List. Most entrepreneurs start a business because they are good at a particular service or product but that does not always translate to being good at running a successful business. That’s why our small business tax services are tailored to help entrepreneurs.
  There are many ways to stack the odds in your favor to make sure your business succeeds. Number one is to understand that using professionals to help you actually can save you money from all the mistakes they save you from. Please click on our services tab to understand all the ways we can assist you in growing the profitability of your business.

  We have grown over the years because so many small businesses have found the value of our services far exceeds the costs. If you want us to contact you immediately just click this link contact us. Also, if you contact us to discuss your business we will provide you with a free copy of the book co authored by Bert Doerhoff CPA. He joined with four other successful CPAs from across the US to write a book that shares their thoughts and insights on the Business of Business from startup through sale and legacy issues, including small business tax services. We have many different kinds of resources at our disposal. That’s why we can provide quality business accounting services.

  Read more about how others are starting and running successful businesses. We have tips about everything including small business tax planning.

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