We are upon a season of business ownership and entrepreneurship. Everyone wants to start a business, which is not necessarily a bad thing. Mostly we don’t do a very good job doing the research necessary to ensure we are following the proper steps to get started. I had to get down in the nitty gritty and find out some information. My sister Hiranda Brock of Dream Makerz Outreach and I really had to do the ground work and find out by God’s grace what we needed to do! At this point I have done it enough for others that I know the basic startup tasks that need to occur if you are going to start a business, at least in Alabama where we live. So here is what you can do. Now let me say this. Don’t be in a rush to do all this. Make sure you do all of your own research and make sure you are making the right decisions for yourself. I am simply here to help you get your ducks in a row so you don’t waste a whole lot of time finding information like I did.
So there is the option of sole proprietorship, which means you can do business as yourself and not do any of these things that I am talking about. It is not recommended long term, but if you don’t have your finances together and you don’t have a solid plan, you need to develop a plan and just do something! You need to, however, keep really good records and track your expenses on your business. The liability is on you when you are a sole proprietor if something happens so you must be careful, cautious and…..oh you know ORGANIZED!
In Alabama there is a website solely dedicated to ensure business owners have what is needed in regards to business establishment. You need to save this website in a safe place where you can easily get to it. http://sos.alabama.gov/
I create folders in my Favorites section of my computer to hold important websites, this should be at the top of your list.
A name reservation allows you to search and reserve your business name, which kind of puts it on hold so no one else can get it OR you find out someone already has the name you have been working so hard to promote and you have to make some adjustments!
LISTEN TO ME! CHECK HERE FIRST! I don’t know what other states call it but you need to check and make sure someone doesn’t already have the name first before you get all extra excited! It also won’t hurt for you to do a Google search to see if other people other than in Alabama because I am not a brand person, but I do know it will be awfully hard to promote and brand your business if someone in Colorado already has a pretty big following in a different name spelling.
Hey! SAVE MONEY! The name reservation is $28 dollars in Alabama. You must pay with card online, it will ask you if you want to move to the next step or not
Also you need to do your research to find out what level of business you need to classify your business in, which is a whole other discussion. Just know you need to decide if your business is an LLC, Corporation, S-Corp, etc. I am not going to break all of that down here, but you need to decide that BEFORE you reserve the name because otherwise you are going to have to pay $10 to get it changed and that is money you need in your pocket!
This is where your organization skills need to come in full effect! You need to PRINT and SAVE a copy of your name reservation. You only have a couple of days to access this document so save it as SOON as you pay for it! Create a folder in your Google Drive, One Drive and/or Dropbox, label it “Startup Paperwork” or something like that! Trust me on this! You need this in your life! Also print you a copy, this is option, you can see where I talk about the difference between digital and paper filing including the pros and cons. I keep a paper copy because of the next step.
2. Articles of Formation or Incorporation
Your name reservation will give you a FULL YEAR to get your stuff together and that is a complete blessing! You need to be saving money! Once you retrieve your name reservation, you then move on to Articles of Formation. The best way I can explain this next step is letting the state know you 1. serious about this thing and 2. they can start taxing you!
If you are going to move on to this next step, you need to get your ducks in a row! You need to read carefully every single portion of this form and ensure you fill everything correctly. You will need $163 (In 2018, in case this blog post is up in 2025 and things are different Ha!) $100 goes to the probate judge and $63 goes to the Secretary of State. The
preference is you type it and print it out, but they have accepted my handwritten ones before. You need to get these amount in a separate cashier’s check or money order. I recommend you keep ALL of your Name Reservation and Articles paperwork together because you will need to send a copy of your Name Reservation.
ONce you send this off, then you are clear to go ahead and get you an EIN (your business social security number). Once again, I will repeat friends, SAVE ALL OF THIS IN ONE FOLDER. You will thank me later! I have found individuals who could not find their paperwork and its because they didn’t listen to me! I don’t care how long you are in business, keep your documents in a safe place where you know where to find them!
once you mail your form and your money off, within the next couple of weeks you should receive your forms in the mail which will basically be your application with a sticker on it indicating it was processes. You may need to be pay more money to retrieve an actual document indicating the formation, but most likely that form will be accepted.
3. Bank Account
This is where it all comes together because everything I just discussed is going to be needed when you walk into a bank and open a business account! EVERYTHING! I have yet to hear a bank say different! They want to know you have all your ducks in a row and there is nothing more professional and bad ‘you know what’ than walking into the bank with all of your documents ready to go! And let me go ahead and put this in there too, make sure you are working on some things financially. Opening a business does not automatically grow your personal bank account. Shoot, starting a business doesn’t automatically grow your business bank account. I am not an accountant or money person, but after three years in business, I realize that I have very poor money habits and I have started engaging in reading books and listening to videos by Tony Robbins and Dave Ramsey three years behind.. Do yourself a favor and educate yourself and get your finances in order!
Until NEXT TIME!!!
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