Starting a Business in NH: Everything You Need to Know
Starting a business in NH is a very involved process such as complying with state regulations, getting proper permits, and that you have a good location.3 min read
2. Tips for Structuring Your Business
Starting a business in NH is a very involved process. In addition to choosing how to structure your company, you will need to be certain that your business complies with the regulations in this state, that you have applied for the proper permits, and that you have a good location.
Basics of Starting a New Hampshire Business
The most important step to starting a business in NH is picking a structure for your business and then completing the incorporation process. You can complete choosing your business structure in three basic steps:
- Decide what business entity type best fits the needs of your business.
- Register your business.
- Secure a brand name for your company.
After you've finished the incorporation process, you need to make sure that your business follows the tax code in New Hampshire. You can visit the state's Department of Revenue website to access a variety of tools that will help you fulfill your tax requirements.
Almost all businesses in New Hampshire will need to obtain licenses and permits before they will be able to offer their goods or services. On the NH.gov website, you can find the Tax Licenses & Permits page that is dedicated to frequently asked questions related to this issue. On this page, you can find which licenses/permits your business needs, and you can find instructions for filing.
You should make sure that you have a business bank account that will be used solely for your company. Opening a business bank account will make it easier for you to keep your personal and business finances separate, and will also give your business more credibility with customers. Research a variety of banks before opening account so that you can find an institution that best meets your needs. Generally, choosing a national bank is the best option.
You also need to pick a good location for your business. For instance, your business shouldn't be too close to competitors, and it should be easily accessible by your customers.
Tips for Structuring Your Business
As mentioned, choosing a business structure is the first step in starting your New Hampshire business. For most businesses, the limited liability structure is the best choice, for a variety of reasons. With an LLC, your business won't be at risk for double taxation, which is a disadvantage of corporations. Also, LLCs are not required to have corporate officers or a board of directors. On the other hand, if you want to raise capital from investors, or plan to one day take your company public, structuring as a corporation may be the better option.
When running a small business, you could structure your company as a:
- Sole proprietorship
If you want to run a sole proprietorship, all you need to do is to transact business in the state. No organizational documents are required for this business structure. With a general partnership, you also are not required to file organization documents with the New Hampshire government. You should, however, draft a partnership agreement that will help prevent conflicts between your business's partners. You will need to formally register a limited partnership with the New Hampshire Secretary of State.
To form an LLC in this state, you will need to fulfill the following requirements:
- File a Certificate of Formation.
- Appoint a Registered Agent.
- Draft an operating agreement for internal use.
Forming a corporation in this state requires the same basic steps as forming an LLC. The biggest differences are that you will need to file Articles of Incorporation instead of a Certificate of Formation, and should draft corporate bylaws instead of an operating agreement. If you want S corporation tax treatment, you will first need to incorporate in New Hampshire and then file Form 2553 with the IRS.
Your company's Articles of Incorporation should include the following information:
- A corporate name that includes a designator such as Corporation, Incorporated, or Inc.
- A purpose for your corporation.
- The number of authorized shares your company will issue.
- A statement that your company will comply with the New Hampshire Uniform Securities Act.
- Contact information for your incorporators.
- Your Registered Agent's name and address.
- Original signatures from all incorporators.
After your Articles of Incorporation have been approved, you will be mailed a stamped copy.
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