This article provides a quick and easy guide to starting a business in Missouri. There are certain steps you need to take when you have a business idea of forming your company, as well as filing fee, permits, and other requirements that may be necessary for various types of businesses. The first and the most essential step is registering a name. This article will discuss those topics in detail.
Register a Business Name in Missouri
Step 1: Choose a Business Structure
Before you register a name for your Missouri business, it is important that you have made the decision on how your company will be structured. There are four main types of business structures for small Missouri businesses: sole proprietorship, partnership, corporation, or limited liability company (LLC).
However, some small businesses may choose to operate as an unincorporated association or simply operate as a registered agent of another organization.
A sole proprietorship is an unincorporated business with only one owner. It has no legal distinction from its owner and does not require registration at the state level. A sole proprietor should use their legal name for doing any business transactions and hiring employees.
If this is your first time running a small business using your own business assets and credit, it is advisable to choose this type of structure.
A partnership is a business that has more than one owner and works under a partnership agreement. For the purpose of name registration, partnerships must have an “assumed partnership name” attached to all business documents.
When registering a name for a partnership, it is important to ensure the assumed name matches what you will use as your official name. The common legal term for this is “Doing Business As.”
A partnership does not require articles of organization or any other filings with the Secretary of State at either the state or federal level, but richly benefits from having its own federal tax ID number (EIN).
A corporation represents ownership by shareholders and takes on a legal identity separate from those who own it. Corporations are required to register with the Secretary of State in order to conduct business, but there are no fees associated with filing articles of incorporation.
For an initial filing, you will need to draft your own articles of incorporation ensuring they meet state requirements (see link below for more details). You will also need to obtain an EIN if you plan on hiring employees or opening a business banking account.
Limited liability company (LLC)
A limited liability company (LLC) is like a hybrid between a partnership and a corporation. It provides personal liability protection for its business ownership while allowing them the business tax benefits of sole proprietorships and partnerships. If this is your first time running a small business using your own personal assets and credit accounts, it may be advisable to choose this type of structure over a limited liability partnership.
Step 2: Check Name Availability
The next step is to reserve your business name. This means you are checking the availability of a specific business name in your county and state and filing it when necessary. It is important to note that there may be certain limitations when choosing a business name.
For example, no two businesses in the same county can choose the same assumed or Missouri fictitious business name, and no one else can have already reserved that particular name. Additionally, you must ensure no similar names have been previously registered in Missouri (and elsewhere). To check if a business has already been taken, use this link: https://www.sos.mo.gov/business/
If you find that your desired business name is unavailable or taken by another company in your county or state, you can either choose another name or seek out legal help through the Missouri Secretary of State’s website www.sos.mo.gov/business-services/reserving-business-name
Domain Name Search
If you are starting an online business, it is important to check for the availability of your business name as a domain name. To do this, simply type in the desired web address of your business using ‘http://www.whocanyouseeme.org’.
If your requested website is not available, you can use this website to find an available alternative (.com / .net / .biz). You will be required to complete a Domain Name Reservation Request Form when registering with the Secretary of State’s office. This form includes more information on reserving for specific purposes including non-commercial uses.
Missouri Business Name Search
If you choose to register your business name through the Secretary of State’s office, the following link will provide you with more details: https://www.sos.mo.gov/business-services/how-do-i-reserve-do.
Step 3: Form Your Business With the State of Missouri
Once you have reserved your business name with the Secretary of State, it is time to file articles of organization. A step-by-step guide on how to complete this process can be found here: https://www.sos.mo.gov/business-services/prepare-file-articles
While articles of organization will help establish your official business structure, it is important to note that not all businesses must file their articles with the state in order to legally conduct business in Missouri (for example when operating under a name other than your legal one).
Protect Your Business Name With a Trademark (Optional)
Once you have decided on your business name, it is important to protect it by registering any trademarks. You can search for registered marks using this link: https://www.uspto.gov/trademarks-application-process/search-trademark-database
- A trademark protects the distinctive symbols, words, phrases, logos, or other devices used to identify a product or service and distinguish it from others.
- Trademarks are not limited to names of products but include slogans that represent your business as well.
- To benefit from trademark rights, however, most businesses must use their marks in connection with their goods and services (for example putting the name on the packaging) or establish evidence of secondary meaning through the long-term use of the mark without interruption over a specific time period.
For more information regarding trademarks, please refer to the United States Patent and Trademark Office website at https://www.uspto.gov
How to Change the Name of a Missouri Business?
If you have reserved or filed an assumed corporate name with the Secretary of State, you may need to file a “certificate of amendment” with the Office in order to change your official business name. More information on how to complete this process can be found here: https://www.sos.mo.gov/business-services/how-do-i-change-the-name.
What Is A DBA?
A DBA (Doing Business As) is the legal name of a business entity that differs from its trade or assumed name. For example, Jeff Smith LLC could choose DBAs for “Jeff’s Tree Service”, “Smith Handyman Service”, etc., but all would legally be under “Jeff Smith LLC.”Each DBA must be registered with the Secretary of State.
Is a business license required in Missouri?
The Office of the Secretary of State does not issue a general business license. Most Missouri cities and other localities do require a license to operate your business, so you will need to contact your city or county officials to learn more about their requirements.
How do I get a tax ID in Missouri?
Taxpayers that are required to file a federal Form 940, Annual Return of Withheld Federal Income Tax, or Form 945, Annual Return of Withheld Federal Income Tax for U.S. Armed Forces should contact the Missouri Department of Revenue at 1-800-356-6302.
Do I need a license for my business online in Missouri?
Yes. If you will be selling goods in the state of Missouri, then you need a vendor’s license to collect sales tax and a business license to operate your business. Please review our detailed blog post for additional information: https://www.readybusinesschecklists.com/need-business-license-missouri/.
How to start a business in Missouri
Except for registering a business name, to start your business, you have to follow other steps:
1. Get an EIN number from the Internal Revenue Service IRS:
EIN is a unique number that identifies a business. You can apply for EIN with a Federal Employer Identification Number (EIN) Application at IRS website. You need it for:
- Opening a bank account.
- Hiring employees.
- Applying for business licenses and permits.
2. Open a Business Bank Account:
You need to create a business bank account for your business. Ask the bank about:
- A routing (ABA) number which is nine digits on the bottom of checks that you will be using as a small business owner. A routing number identifies the financial institution and country where the account was opened. The two-digit number there tells you where it is located.
- A checking account, so start saving for taxes and record-keeping and other business expenses related to your new business.
3. Apply for Business Licenses & Permits:
As a business owner, you need to apply for all necessary licenses and permits. These will vary depending on the type of business you choose. For instance:
- A general liquor license is needed when selling or serving alcohol in most cases. You’ll also need special permits if your business operates near schools or churches
- A certificate of occupancy is required when leasing commercial space, this verifies that the structure meets local housing and safety codes and will be used for its intended purpose
- A zoning clearance is needed when your business will be located in a restricted area
Check the requirement of your state and apply for all necessary licenses and permits before you open a business to avoid hassles later on.
Contact http://www.sos.mo.gov/business-services/how-do-i-get-a-license/ for more information about licenses and permits required in Missouri.
4. Find Financing:
If you’re starting a new business, you’ll likely need financing to get it off the ground. Banks and other lenders will require your business plan, so be prepared with that before visiting potential financiers.
- Missouri Business One Stop: https://www.readybusinesschecklists.com/missouri-business-one-stop/
- Your state’s economic development department: http://www.sos.mo.gov/business-services/how-do-i-get-a-license/#financial_resources
5. Hire Employees:
As a business owner, you may need to hire employees in order to help your company grow
Your state’s Department of Labor can provide information about what licenses are required for hiring certain types of personnel. You will also want to meet with an accountant or tax expert when it comes time to file quarterly taxes and file payroll withholding forms.
If you have five or more employees, you’ll need to comply with federal regulations under the Affordable Care Act.
6. Obtain Business Insurance:
You need to find a good insurance agent who can help you understand the different types of coverage that your business might need. Possible policies include:
- Health insurance: may be available through a spouse’s policy
- Property insurance: protects your business from theft and damage
- General liability insurance: insures against damages to property or injury sustained by third parties on the premises
- Workers compensation insurance: this type of coverage pays benefits to workers who are injured or contract job-related illness when working for your company. This is required in all 50 states, but options vary depending on business location.
- Unemployment insurance: All but five states require unemployment insurance for at least some businesses. If you plan to hire employees, you will need to do this before their first day of work.
7. Set up an Accounting System:
Small business owners need to keep records of all transactions and business income. A good accounting software will help you save money on taxes, so consider hiring an accountant or bookkeeper who can manage your books for you.
8.File your Operating Agreement:
You’ll need to create an operating agreement for your LLC or corporation. This is a legal document that describes your company’s management structure, its assets, liabilities and responsibilities. You will also need to file this with the state where you are registered as well as any other states where you plan to do business.
Types of business entities in Missouri
C corporation is taxed as a separate entity from its owners, which can result in double taxation. This is not the case for other types of business structures. In addition, C corporations have more tax filing requirements and formalities
An S corporation does not pay any federal income taxes. Instead, profits and losses are passed through to shareholders’ personal tax returns. An S corporation’s earnings may be subject to self-employment taxes as well as state and local business taxes.
Incorporating with an LLC means that you will enjoy protection while having more control over your Missouri company than most other business entities
Liability protection: An LLC provides its members with limited protection, which means that the members are not responsible for any of the corporation’s debts
A non-profit corporation is created to provide goods or services that benefit the public rather than earning a profit for its shareholders
Pros and cons of registering a business in Missouri
- As a business owner, you may qualify for tax exemptions and other benefits
- There are educational programs available to help new business owners learn more about their field
- You can obtain loans from government institutions or local banks to help with startup costs
- Starting a Missouri LLC you will have a personal asset protection
- Starting the process of registering a business takes time. Note that all local businesses must obtain a certificate of registration from the Secretary of State’s Office before starting operations in the state. For a Limited Liability Company, a registered agent must be on file with the Missouri Secretary of State as well
- The cost for filing articles of incorporation or applying for an LLC varies depending on your desired entity structure. ReadyBusinessChecklists recommends contacting your Secretary of State’s Office directly to inquire about specific fees.
How much money should I spend to register a business in Missouri?
Startup business costs can vary, depending on the type of business you operate.
In order to incorporate a new business in Missouri, you will need to pay $90 for Articles of Incorporation. This fee is set by the Secretary of State’s Office. To form an LLC (Limited Liability Company), your startup costs will be $90 to file Articles of Organization. Again, this must be done with the Missouri Secretary of State.
Missouri Corporations are charged a $10 fee for filing their Secretary of State’s Statement of Information
All businesses in Missouri must file Sales and Use Tax Returns monthly. However, the amount needed to be paid depends on your estimated tax liability and is due by the 20th day after the close of each month. This information is regularly reported to the Missouri Department of Revenue.
If you have your small business name reserved, filed articles of organization with the State small business administration, and are protecting your brand with a trademark (if applicable) then you’re ready to file for a Missouri Tax ID.
The next step in the process would be to complete an online vendor’s account, or request a paper one through the mail, at https://dor.mo.gov/business-licenses/district-offices#vendors and register for sales tax collection and reporting at https://www.readybusinesschecklists.com/how-to-register-for-sales-tax/.