There are many good reasons to start a business in Florida. The state’s government keeps regulatory requirements and business taxes low. There are no personal income, capital gains or death taxes. The state’s higher education institutions work closely with the business community to build programs that assist Florida’s industries. While Florida is a great place to start a business, the process can be tricky and time-consuming, so we’ve put together a list of the 10 of the most common steps for new businesses in Florida. While these are the most common steps to take, if you are considering opening a new business, you should consult your legal and financial advisors to guide you through the process.
One of the first tasks you’ll need to complete is to determine your business structure, which will depend upon your business type or industry. Some businesses require a specific business structure depending on the industry or required licenses of the profession. Another consideration for your business structure is if your business will be For Profit or Not-For-Profit.
The business structure can have implications for taxes and other business operation aspects. Your options for business structures in Florida are Corporation, Limited Liability Company (LLC), Partnership, General Partnership, Limited Partnership or Sole Proprietorship. You should consult with your legal and financial advisors to determine the best fit for your business, but the most common of these are:
Register the business with the DOS by completing and submitting the Articles of Incorporation found on Florida’s Department of State Website. In order to do this, you’ll need to gather the following items:
The Fictitious Name Act (s.865.09, F.S.) requires any person or business entity to register a “fictitious name,” also known as a “doing business as” (dba) name, with the Florida DOS prior to conducting business in the state. If you have filed as a sole proprietorship and your business has a name other than your own, you must register this as a fictitious name. If you have formed a corporation, LLC or other separate legal entity, and the business name is not the same as what you registered, you’ll need to file a fictitious name. Visit the Florida DOS website to learn more about specific requirements and exemptions from this step of the process
An EIN – or Employer Identification Number – serves the same purpose to a business as a Social Security number serves to an individual. With an EIN, you’ll be able to open a business bank account, establish business credit, hire employees more easily, and apply for business licenses. You can obtain an EIN by filing a Form SS-4 with the IRS. You’ll only need an EIN in the following circumstances:
If you are establishing an LLC in Florida and none of the above apply to you, you are not required to register for an EIN. However, most banks will require one for a business savings account, loan, business line of credit (BLOC) or other business accounts.
There are a few reasons why you will need to register with the FDOR, most importantly to pay Sales and Use Tax, as well as Corporate Income Tax.
When it comes to Sales and Use Tax, you will need to register as a sales and use tax dealer. These taxes apply to the sale, rental, lease, or license to use goods, certain services, and commercial property. Sales and Use Tax is to be collected at the time of each sale and is due to the DOR at the end of each reporting period. How often you file and pay depends on the amount you collect in sales tax, as follows:
All corporations, LLCs and partnerships doing business in Florida must file for Florida’s Corporate Income Tax. There are many tax incentives you can employ to help abate these costs, such as operating within a designated rural county, producing renewable energy and rehabilitating a brownfield site or site contaminated with dry-cleaning solvent.
To file Corporate Income Tax, your business will need to submit the Florida Form F-1120, generally, on or before the first day of the fourth month following the close of your business’ tax year. If your business owes more than $2,500, you are eligible to pay estimated taxes, which are due on the last day of each quarter of your business’ tax year.
There are various ways to fund a new business, including Small Business Administration (SBA) loans, short-term loans, credit cards, crowdfunding, and others. Florida’s Small Business Development Center provides helpful resources and offers free financial advice for new entrepreneurs regarding funding options. The bank where the business checking account will be housed is also a good source for lending options.
All employers are required by federal and state law to report newly hired and re-hired employees to the DOR. There are a variety of ways to report new hires, including online reporting, electronic reporting and by mail or fax. Information is available at the website for the Florida Department of Revenue, Child Support Services for Employers.
If your business deals with a skilled trade, most likely, you will need to apply for a business permit or license. Florida’s Department of Business & Professional Regulation (DPBR) licenses a wide range of industries, such as community association managers, geologists and restaurants, while Florida’s Department of Agriculture & Consumer Services (DACS) licenses businesses like private investigators and agricultural dealers.
The State of Florida’s Business Information Portal website provides information on the licenses, permits, and registrations that may be required for starting a business in Florida.
Local county and municipal governments may have their own requirements for new businesses, and they may also require additional permits and licenses. Be sure to check your local county or city’s website to ensure you are familiar with local ordinances, as well as any additional requirements they may have for opening a new business.
While a business bank account isn’t required unless the business is incorporated, it’s a good idea to keep business and personal finances separate. Doing so can help reduce confusion at tax time or during an audit.
It’s best to work with a bank that offers distinctive account types for businesses and individuals. Many business bank accounts come with business-specific perks that can provide value to a new company, such as longer billing cycles or higher credit limits.
Aligning with a bank for business banking services is a good step to take early on in the business start-up process. In addition to business checking accounts and loans, Seacoast offers other services that can benefit new business owners, such as payroll processing, payment processing, ACH Credit Origination, ACH Debit Origination, and account reconcilement services.
To learn more about banking services that can help support new business startups in Florida, contact a business banking specialist at Seacoast Bank. Call 888.669.5778.
Also, take advantage of the free resources available on the Florida Department of Revenue website.