How to Start a Business in Nevada
Nevada is a popular state to start a business in the United States because it has the nation‘s lowest income tax.3 min read
Have you been wondering how to start a business in Nevada? Nevada is a popular state to start a business in the United States because it has the nation‘s lowest income tax. This advantage makes it a very lucrative destination to launch a new company.
Steps to Starting Your Nevada Business
There are several steps that new business owners should take when starting a business in Nevada.
- Choose a meaningful business to you and the community. Deciding what type of business to begin is typically the first step when starting a new company. Pursue a business that aligns with your interests, natural abilities, and personal goals. Establishing a company that suits your interests will encourage you to stay motivated during difficult periods and may improve your odds of success. The most common entity types are corporations, limited liability companies (LLCs), partnerships, and sole proprietorships.
- A corporation is a complex entity structure which requires shareholders, corporate officers, and a board of directors. This business structure often does not work well for small businesses due to double taxation. Startups and fast-growing technology companies are common types of businesses that form corporations. This is because a corporation can benefit companies that want to take the business public, need to manage large healthcare costs for employees, and want to raise investment capital.
- The easiest business to form, own, and operate is a sole proprietorship. Sole proprietorships are companies that are operated by and legally identical to you, the business owner.
- Sole proprietorships located in Nevada will not have a separate legal entity created. In the eyes of the law, the individual and the business are treated as one party. The business owner will be personally responsible for any wrongdoing or business activity.
- Select a name for your business. It is fairly simple to establish a business using your name or trade name. In fact, even if a trade name is used, the business will still be officially and legally in your name.
- Plan and outline the business.
- Formulate the business. Registering a business as a Nevada business entity will have two major advantages:
- Protection from any personal liability in case the business is sued.
- Increased credibility.
- Register the business for tax purposes. An Employer Identification Number (EIN) is a nine-digit number that is assigned by the Internal Revenue Service (IRS) to businesses operating in the United States. This number is used for the sole intent of identifying businesses. An EIN may also be known as a Federal Employer Identification Number (FEIN). In order for employees to pay and file taxes, business owners need to obtain an employee identification number.
- An EIN is primarily used to report employment taxes.
- The IRS uses the EIN to identify businesses during the tax filing process.
- EIN's allow businesses to open a business bank account or hire employees. It's important to note three important Nevada taxes that may impact your business:
- Sales tax permit: Required for businesses that are required to collect sales tax. The sales tax permit costs about $15 per location/storefront.
- Sales tax: Businesses in Nevada that transfer or sell tangible personal property are required to collect sales tax on the transaction. The tax that a business collects is forwarded to the Nevada Department of Taxation.
- Miscellaneous taxes: Other taxes that may need to be paid include:
- Payroll taxes.
- Unemployment insurance tax.
- Modified business tax.
- Commerce tax return.
- Create credit accounts and business banking accounts for the business.
- Establish accounting procedures.
- Obtain any necessary licenses and permits.
- Get properly insured.
- Develop your branding.
- Create a professional website and establish an online presence. Regardless of what industry you work in, having a professional website is essential to the long-term success of a company. A website will allow potential customers to discover the services and products that you offer and enhance your company's credibility. Also, consider other opportunities to promote your company online. These may include:
- Creating social media accounts for the business such as Instagram, Facebook, and Twitter.
- Setting up a local Google profile.
- Creating accounts on customer review sites such as Google reviews, Yelp, and Trip Advisor.
- Obtain financing. Some of the most popular ways to obtain financing include:
- SBA loan guarantee.
- Conventional bank loan.
- Peer-to-peer lending.
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