Did you know that Los Angeles County is home to 244,000 businesses? What’s even crazier is if Los Angeles County were its own nation, it’d be the 19th largest in the WORLD. 

If you’ve been thinking about starting a business in Los Angeles County, but more specifically, the city of Los Angeles, take this as a sign! 

These are the general steps you need to take to turn your thoughts into action. Depending on the specifics of your business, such as whether you choose to incorporate or have any employees, you may not need to take all these steps. 

Step 1: Apply for a Federal Employer Identification Number (EIN) 

An Employer Identification Number (EIN) is similar to a Social Security Number, but for your business. You need an EIN to file taxes, apply for business permits, open a bank account, get credit cards, and provide your contractors with a 1099. 

To apply and register online for an EIN with the IRS, you can use the IRS EIN Assistant. 

If you are not a U.S. citizen, you may need an Individual Taxpayer Identification Number (ITIN) instead. If you choose to run your business as a sole proprietor without employees, you may use your Social Security Number instead of an EIN. 

Step 2: Apply for a California Payroll Tax Account Number

If you decide to hire employees for your business, you will need to obtain a Payroll Tax Account Number with the State of California in order to file and pay your payroll taxes.

Generally, a business is subject to state payroll taxes when over $100 in wages is paid in a calendar quarter to at least one employee. Wages include cash payments, commissions, bonuses, and non-cash payments (like meals and lodging) for services. 

You can apply for a Payroll Tax Account Number here. 

Step 3: Obtain a Seller’s Permit

A Seller’s Permit is required if you will sell any goods or products within California or if you will be a wholesaler of goods or products. For example, if you want to open up a hair salon and sell shampoo, you will need a Seller’s Permit. 
 

You can register for a Seller’s Permit online with the California State Board of Equalization or in-person at a field office. 

Step 4: Incorporate your business

If you decide to structure your business as a partnership, corporation, or limited liability (LLC), you will need to register or incorporate it with the California Secretary of State. 

• For a limited partnership, you will need to file a Certificate of Limited Partnership
• For a general partnership, you will need to file a Statement of Partnership Authority
• For a limited liability partnership, you must first have registered as a general partnership. You will need to file an Application to Register a Limited Liability Partnership
• For a corporation, you will need to file Articles of Incorporation and a Statement of Information 
• For an LLC, you will need to Articles of Organization and a Statement of Information

Step 5: Register your Fictitious Business Name

If you decide to open a business that does not use your personal first and last name, you will need to register your business name, also known as a fictitious business name (FBN). Be sure to verify that no one in Los Angeles County has your business name. If you choose to incorporate your business, you will also need to check that the name is available with the State of California. 

Once you’ve verified that your FBN, you will register the name with the County of Los Angeles. To register, submit a Fictitious Business Name Statement and the accompanying filing fee either online or in-person. 

After submitting your Fictitious Business Name Statement, you will need to advertise the name in a local newspaper for a minimum of four weeks. Here is a list of local newspapers in the county. 

Step 6: Obtain your Business Tax Registration Certificate

The Business Tax Registration Certificate (BTRC) is required for all businesses in the city, regardless of whether your business is a sole proprietorship or you choose to incorporate. You will use your BTRC number to pay business taxes with the City of Los Angeles each year.

To register online you will need to provide:

• Your Social Security Number if your business is a sole proprietorship 
• Your EIN if your business is a partnership, a corporation, a limited liability company, or a trust
• A description of your business activities
• Your legal business name
• Your business start date
• The primary mailing address for your business
• Your business contact information

Navigating everything you need to do can be tricky, and even though we’ve onlined six steps, each business is different. In some cases, there are less than six steps, and in others, there are more. LawChamps is ready to connect you with an experienced attorney to help you start your business. Click here to learn more about how LawChamps can help. 

This article is intended to convey generally useful information only and does not constitute legal advice. Any opinions expressed are solely those of the author, not LawChamps.