Starting a business in the United States entails a number of legal and administrative requirements. While this is a basic overview of the types of legal documents you may require, it is crucial to remember that precise requirements will differ based on the state and nature of your business. It is advised that you speak with a legal professional or business advisor to satisfy all legal obligations. Here are some examples of common legal documents needed to start a business.

1. Entity Formation Documents

If you’re forming a corporation, you’ll need to file this paperwork with the state’s corporate regulatory department to formally create your business. This department could be called the Secretary of State, Division of Corporations… or something of the like. 

  • Articles of Organization: For limited liability organizations (LLCs), these documents are filed to establish your company’s legal structure.
  • Articles of Incorporation: For C Corps and S Corps, these documents are filed to establish your company’s legal structure.

2. Operating Agreement (LLC) or Bylaws (Corporation)

These written agreements define your company’s internal rules and regulations, such as ownership structure, management roles, and decision-making procedures. These documents can assign percentages of membership interests (LLC), or shares of Common or Preferred Stock (Corporation). 

3. Employer Identification Number (EIN)

An Employer Identification Number also known as Federal Tax Identification Number is a unique nine-digit number assigned by the Internal Revenue Service (IRS) to identify businesses and other entities for tax purposes in the United States similar to a Social Security number for your company.

Why Do You Need An EIN?

If you’re starting a business, hiring employees, opening a business bank account, or operating as a corporation or partnership, you’ll likely need an EIN. It’s also required if you offer any types of retirement plans for self-employed individuals, employees, or if you’re involved with certain types of trusts, estates, or nonprofit organizations.

4. Business Licenses and Permits

Acquiring the required business licenses and permits is an important step in starting and running a business in the United States. These licenses and permits are essential to guarantee that your organization complies with legislation, safety standards, and industry-specific rules and regulations. They are issued by federal, state, and local government organizations. Here is an overview of some of the required business licenses and permits that you may need, depending on what type of business you choose.

Types of Business Licenses and Permits

  • General Business License
  • Industry-Specific Licenses
  • Health and Safety Permits
  • Zoning and Land Use Permits
  • Environmental Permits
  • Professional and Occupational Licenses
  • Fire Department Permits
  • Alcohol and Tobacco Permits
  • Home-Based Business Permits
  • Signage Permits

5. DBA (Doing Business As) or Fictitious Name Registration

A “Doing Business As” (DBA) or Fictitious Name Registration is the process of legally registering a business name that is different from your legal business name. This is commonly done when you want to operate your business under a name that is not your personal name (for sole proprietors) or your official business entity name (for corporations or LLCs).

Why use a DBA?

  • DBAs allow businesses to operate under a trade name that is more recognizable, marketable, or descriptive than the legal business name.
  • For example, if your legal entity is “John Smith LLC,” you might want to do business as “Smith’s Electronics.”
  • After finding out that a business name is available in your particular state, you can register the name of your business after filing the proper documents. However, the globe is a very large place with many businesses, some that may have the same name as you. States are reasonably thorough with not registering two businesses with the same name. Using a DBA may then give you access to different domain names, URLs, and email addresses. 

6. Sales Tax Permit

A Sales Tax Permit, also known as a Seller’s Permit or Sales and Use Tax Permit, is a legal document issued by a state’s taxing authority that allows a business to collect and remit sales tax on taxable transactions. This permit is required for businesses that sell tangible goods or certain services that are subject to sales tax. Most states require that you report, file, and pay the sales taxes that you have collected from your customers, on a quarterly basis. Most states have an online portal for reporting your sales taxes.

There are a number of different ways to set up your books and accounting methods to track the sales taxes that you have collected from your customers. Speaking to a professional will help to determine which setup is appropriate.

Why do you need a Sales Tax Permit?

  • If your business operates in a state with a sales tax, you are generally required to collect sales tax from customers on taxable transactions.
  • The Sales Tax Permit gives you legal authority to collect sales tax and remit it to the state’s taxing authority.

7. Agreements and Contracts

Agreements and contracts are legally binding documents that outline the terms and conditions agreed upon by parties involved in a business transaction, partnership, employment relationship, or other arrangements. These documents help establish clear expectations and protect the interests of all parties involved.

Types of Agreements and Contracts in a Business Context

  • Service Agreements
  • Sales Contracts
  • Non-Disclosure Agreements (NDAs)
  • Employment Contracts
  • Independent Contractor Agreements
  • Partnership Agreements
  • Joint Venture Agreements
  • Licensing Agreements
  • Lease Agreements
  • Loan Agreements

8. Intellectual Property Documents

Intellectual Property (IP) refers to creations of the mind, such as inventions, literary and artistic works, designs, symbols, names, and images used in commerce. Protecting your intellectual property is crucial for maintaining the value of your creative and innovative efforts. 

Oftentimes, when people are hired into an organization where they are signing some sort of agreement in the beginning as a requirement for onboarding, they are just so excited about getting the position, that they don’t fully read the onboarding agreements that they are signing. This is where they put the language about owning all of the IP rights to anything that you create while you are working for them. It is essential to not only read, but also fully understand what rights you are retaining vs. assigning over to your new employer. There may be a point where negotiation of these rights is possible, before you sign your onboarding agreement. Seeking advice from a professional is highly recommended.

Types of Intellectual Property Documents

  • Patents
  • Trademarks
  • Copyrights
  • Trade Secrets
  • IP Assignment Agreements
  • Licensing Agreements
  • Cease and Desist Letters
  • IP Portfolio Management

9. Insurance Policies

Insurance policies are legally binding contracts between an insurance company and an individual or entity that outline the terms and conditions of coverage, as well as the responsibilities and benefits of both parties. Insurance is designed to provide financial protection against certain risks, losses, or liabilities.

Types of Insurance Policies

  • General Liability Insurance
  • Property Insurance
  • Business Interruption Insurance
  • Workers’ Compensation Insurance
  • Commercial Auto Insurance
  • Professional Liability (Errors and Omissions) Insurance
  • Cyber Liability Insurance
  • Directors and Officers (D&O) Insurance
  • Employment Practices Liability Insurance (EPLI)
  • Product Liability Insurance
  • Environmental Liability Insurance
  • Umbrella Insurance coverage

Each type of insurance policy comes with specific coverage limits, deductibles, and terms. It’s important to carefully review and understand the terms of your insurance policies and work with insurance professionals to ensure that your business is adequately covered against potential risks and liabilities.

10. Documents of Compliance

“Documents of Compliance” is a broad term that can refer to various types of documentation that demonstrate compliance with regulations, standards, or requirements. The specific documents needed for compliance will depend on the context, industry, and jurisdiction.

Documents of Compliance in Different Areas of Business

  • Regulatory Compliance Documents
  • Quality Management System Documents
  • Environmental Compliance Documents
  • Safety and Health Compliance Documents
  • Data Privacy Compliance Documents
  • Financial Compliance Documents
  • Food Safety Compliance Documents
  • Medical and Healthcare Compliance Documents
  • International Trade Compliance Documents
  • Contractual Compliance Documents