Arizona is a beautiful city with lots of opportunities for business. Regardless of whatever age one is, there are always chances to begin a business in this city. If your kid is interested in beginning some kind of small business, the city is open for it and all he or she needs is your help and support. Help them with the requirements that must be fulfilled which will be explained below. Following the simple steps that will be listed and explained will help you aid your kid as he or she establishes their business. With the knowledge, the process will be easier and fast to accomplish.
Steps to Start a Business
1. Choose a type of business
The first step is for your kid to select the type of business that he or she wants to start. If they have done so already then they may skip this step; if not, then your kid would have to make a choice. To make a confirmed choice, your kid would have to do this in line with their skill, knowledge, and passion for a prospective business they want to start. You have to make sure that your kid has a passion for the business they choose because this is what that will keep them committed to it and to face the challenges. It would be the driving force and the zeal will keep your kid motivated.
2. Choose a name
As simple as it sounds, it is a very important thing to do. A name serves as the identity of your business and is also the first thing that people often come in contact with. Having a name is a brand and as your business grows it will be used to refer to your type of quality and services. Make sure that the kind of name your kid chooses for their business is available. Perhaps your kid has chosen a catchy and beautiful name but that name happens to already be in use, he or she can incur legal consequences if they use the name or something similar. Hence, you could check on the internet to find out if that name has been taken or not. Or go to the city council to find out.
Finance is an important component to every business. Without capital one cannot start a business and for kids, the start-up capital may be a bit of a challenge. This will need a lot of assistance from you to raise funds for them. However, there are some home-based businesses that require little or no cash set up except for registration. However, you could loan your kid the entire sum or give them half if they already have some money saved up. The money could always be paid back when the business begins to yield profits.
4. Choose the type of entity
Choosing the type of entity that your business will be like is a must because that is what it will be registered as. Your kid could choose to register their business as a partnership, sole proprietorship, limited liability company (LLC) etc. The City authorities cannot tell you the type of business you form but only an accountant can advise you. The type of entity you kid chooses will determine tax issues, liability etc. For instance, one of the advantages of registering your business as a company is that in case of being sued, your kid will be protected and the company will be sued, so there is no personal liability in this type of entity. Unlike a sole proprietorship, this will result in personal liability when civil matters arise.
To register your business:
- Make sure to check name availability with the Arizona Corporation Commission. You can do this by checking on the A.C.C. website to see if it is available. As mentioned above, failure to do this may lead you to use another person’s business name which will incur legal charges.
5. Secure the name of your business
If the entity name is available on the A.C.C. website, you have three options:
- You can get a name reservation through the A.C.C. website; or
- You can go to the Secretary of State’s website www.azsos.gov and register the name as a trade name; or
- You can submit the paperwork to the A.C.C. to form your entity. A name reservation through the A.C.C. is good for only 120 days. It “holds” the entity name until you can submit the paperwork to form the entity.
- A trade name is effective for 5 years. The Secretary of State registers trade names, not the A.C.C. There are legal considerations as to why you might want a registered trade name, and you should consult with an attorney to determine if you should obtain a trade name. The A.C.C. cannot advise you on whether you should get a trade name or a name reservation.
- If you have a trade name, it is not necessary to also have a name reservation. The trade name “holds” the name for you, and you can form an entity with that name as long as you own the trade name.
6. File with the Arizona corporation commission corporation division
Submit the formation paperwork to the A.C.C. If you are forming an LLC, you will submit the Articles of Organization. If you are forming a corporation, you will submit the Articles of Incorporation. The A.C.C. has online filing for LLCs. All forms and filing options are available online. The formation paperwork must be examined and approved by A.C.C. staff. If approved, you will get an approval letter with additional instructions. If rejected, your letter will instruct you on how to resubmit the paperwork. You can wait until approval before completing steps 7 through 10.
7. Arizona Department of Revenue
You might need to complete a transaction privilege tax application with the Arizona Department of Revenue. The Arizona Corporation Commission cannot advise you whether or not you will be subject to the transaction privilege tax – you should contact the ADOR.
8. City or County Taxes and business licensing
Register the business entity with the city in which the business is located (or county if you are in an unincorporated area). This is for transaction privilege tax purposes and also for any business or occupational licenses that the city requires. The Arizona Corporation Commission does not issue business or occupational licenses. The Arizona Commerce Authority Small Business Services website www.azcommerce.com has links to various informative sites concerning taxes and licensing.
9. Federal EIN or TIN – Internal Revenue Service
Check the Internal Revenue Service (IRS) website www.irs.gov to obtain an EIN (employer identification number) or TIN (tax identification number).
10. Business Account
Open a business account with your bank or credit union. Please note that the A.C.C. will not accept temporary checks that do not have a pre-printed name and address on them, so if you obtained your account before submitting paperwork to the A.C.C., you may have to pay the filing fees through an established account if your checks for the new account do not have a pre-printed name or address.
In conclusion, finding a good location for your kids business is vital and necessary. You may be required to meet a certain standard before using a location for a type of business. Also, make sure to advertise your business in the best way possible. You could do this through the newspaper, flyers, business cards and social media. A website or Facebook account etc. All of these methods are fast and effective.