Start a Business

Step 1

Conceptualization, market research, business plan, capitalization and financing

Once you have conceptualized your business, done market research, written a business plan, and identified your sources of capital and financing, there remain a series of steps that are normally necessary to protect the interests of the business owner and to comply with law. If the subject matter of your business is specially regulated there could be many more steps. For instance, a retail seller of tobacco or alcohol will need approvals from State and local governments. Certain occupations are licensed by the Office of Professional Regulation such as real estate sales and engineering.

Step 2

Choose and reserve a name

Once you have an idea for the name of your business you can search the records of the Vermont Secretary of State, Division of Corporations to determine whether another business is operating under that name. You can conduct a search on the Vermont Secretary of State, Division of Corporations website.

If you determine that the name you want to use is available, you can reserve the name for up to 120 days during which time you can complete planning and organization of your business. The fee for reserving a name is presently $20.00. You can reach the appropriate form through the following link: http://www.sec.state.vt.us/corps/forms/reservat.htm

Step 3

Choose and register a domain name

Perhaps as important as reserving your company name with the State of Vermont is registering a domain name for your website. There are many companies that register domain names, including some of the best known names on the internet, using what is known as DNS or Domain Name Registration System. This system links numeric device addresses to domain names that we use to navigate. To further understand domain name registration, visit the ICANN (International Corporation for Assigned Names and Numbers) website.

If you want to know whether a particular domain name is available, a useful service is known as “whois” which you can use to determine whether a particular domain name is registered, and if so get the name of the registrant. Visit the Whois website.

Of course, you will need a website to associate with your domain name. Web sites can be obtained from a broad range of service providers from the same providers of domain name registration to local specialty designers.

Step 4

Choose a legal structure

Our legal system provides a variety of legal structures for business entities including partnership, corporation and limited liability company. Your choice will be driven by what your business will do, who will be its owners and investors, whether and how many employees it will have and one or more additional factors. A useful summary of the elements of the decision can be found on the Secretary of State Corporate Division Website.

Once you know what type of entity you will be forming, you will need documents to describe the entity (Articles of Organization or Incorporation), lay out how the business will be governed and managed, and provide for the orderly withdraw of shareholders or members and the efficient winding down of the business (By-laws, Shareholders’ Agreement, Partnership Agreement or Operating Agreement).

Step 5

File articles with the Secretary of State

After you have worked through the issues and selected a legal form for your business, you will file Articles of Organization or Articles of Incorporation along with a filing fee with the Vermont Secretary of State (or other State of incorporation) and receive back a Certificate of Organization or Certificate of Incorporation along with filed copy of the Articles that you filed. These should go into a binder with your other organizational documents to begin documenting your business entity.

Step 6

Obtain a taxpayer identification number from the IRS

Unless you are able to utilize your Social Security Number, which is possible in the case of some corporations, limited liability companies and trusts, you will need to obtain a taxpayer identification number or employee identification number from the IRS. If you insist the IRS will still process a written request for an EIN, but these request are more typically processed via fax or online. The form is an SS-4, and can be obtained at the IRS website (search for “ss-4 online”).

Step 7

Establish business account with the Vermont Department of Taxes

You’ll need to open one or more business tax accounts with the State of Vermont, by completing a Form S-1 through the Vermont Department of Taxes. The form can be obtained at the Starting a Business page on their website.

Step 8

If your business will have employees, you will have to register with the Department of Labor and file quarterly payroll reports. These and other forms are available at the DOL website.