While Florida has long been a hot spot for vacationers and snowbirds, it’s also a great place to start a business. As the 15th-largest economy in the world, the Sunshine State offers robust infrastructure and financial incentives, along with an active startup ecosystem and a booming tourism industry.
Whether you’re a first-time entrepreneur who calls Florida home or you’re relocating your business from another state, this six-step Florida startup guide will explain how to get your business up and running, from initial formation to small-business banking success.
From its favorable business climate to its strategic location and robust infrastructure, it’s no surprise Florida consistently ranks among the top states in America for business. The benefits of starting a business in Florida include its:
Before choosing an entity, many entrepreneurs start with a basic business plan to clarify goals, funding needs and ownership structure. Your Florida business structure then determines how your business income is taxed and the level of personal liability protection.
The type of entity you choose depends on whether you’re the sole owner, how you run your business and your personal preferences. There are four main types of business entities to choose from: sole proprietorship, partnership, corporation and limited liability company (LLC).
Sole proprietorships are the simplest business structure, offering a quick, easy and affordable way for solo business owners to get started. Since the business and its owner are treated like a single entity for tax purposes, paperwork and expenses are generally minimal.
One important consideration with sole proprietorships is that they don’t provide personal liability protection, which means the owner is personally liable for the business’s financial obligations.
A partnership structure is often the simplest solution for a business owned jointly by two or more people. Partnership structures can vary based on the business’s ownership and day-to-day operations.
In a general partnership, the partners share equal responsibility and liability. This includes management activities and business decisions, as well as personal liability for the business’s debts and financial obligations.
A limited partnership has general partners who control the business but are fully liable for its obligations, as well as limited partners (passive investors) who enjoy limited liability for their investments.
The limited liability partnership, or LLP, is similar to a limited partnership, though all owners have the benefit of limited liability—including personal liability protection from debts against the partnership and its other owners. LLPs are often used for professional services businesses, like law firms, accounting firms and consulting groups.
A corporation legally separates the business from its owners, distinguishing the two as separate entities. This structure provides business owners with the most liability protection and makes it easy to transfer ownership through the sale of company stock.
However, corporations tend to come with increased complexity, higher expenses and additional government regulations. Depending on the type of corporation, double taxation may apply. This occurs when the business pays corporate income tax on its profits and the shareholders pay a separate tax on dividends and capital gains. There are four types of corporations: S corporations, professional corporations, C corporations and nonprofit corporations.
LLCs are a popular entity choice for business owners looking for pass-through taxation (meaning profits and losses are reported on the owners’ individual tax returns) and limited personal liability. Florida LLC formation is relatively quick and easy, offering more flexibility and lower maintenance than corporations, though it’s important to remember that an LLC’s members are generally responsible for paying self-employment taxes.
Depending on your business’s structure and operations, you can choose from several common types of LLCs, such as single-member LLCs, multi-member LLCs, manager-managed LLCs, member-managed LLCs and professional LLCs.
If you’re not sure how to structure your business, speak with a legal professional and tax advisor before you form an entity and register your business name.
Most Florida businesses — including sole proprietorships operating under a fictitious name — are required to register with the Division of Corporations via Sunbiz.org. But before you register your business name, you’ll want to check that the name you want doesn’t infringe on any existing business’s trademarks. This process includes searching the U.S. Patent and Trademark Office’s trademark database, in addition to checking available domain names for your website.
To complete your registration on Sunbiz, you’ll also need to designate a registered agent with a physical address in Florida. This individual will serve as your business’s dedicated point of contact for any formal government or legal correspondence.
After your business registration filing is officially approved by the state, it’s time to set up your federal and state tax accounts.
Your EIN is like a Social Security number for your business. Florida businesses need an EIN to hire employees, file federal tax returns, and open a business bank account at many institutions. You can get an EIN for your business for free by completing the online application on the IRS website.
Before you can begin business activities, you may need to register your business with the Florida Department of Revenue. Account registration is required for Florida businesses that need to collect, report or pay certain state taxes, such as:
Though Florida doesn’t have a general licensing requirement for businesses, you may be required to register your business based on your industry or local regulations set by your county or city.
Florida business license requirements apply to many industries, including restaurants, real estate agencies, hotels and healthcare facilities. Depending on your industry, you may have to register with the Florida Department of Business & Professional Regulation (DBPR), Florida Department of Agriculture and Consumer Services, Florida Department of Health or one of Florida’s other licensing agencies.
In addition to state-level licensing requirements, municipal governments may impose additional licensing or permit rules. For example, Florida zoning rules are created and enforced by local governments. Other county and city government requirements may include:
As a business owner, you’ll have to comply with all federal, state and local laws. These can include employer obligations, insurance requirements and administrative responsibilities.
Florida employer requirements include:
Once your business is up and running, you’ll need to keep up with some administrative housekeeping, including:
Opening a Florida business bank account is a must for separating your business and personal finances. Along with treasury management solutions, this step will help you manage your business finances and cash flow, limit your personal liability and make it easier to file your taxes.
You’ll also want to set up merchant services, Automated Clearing House (ACH) and other payment tools to simplify transactions, along with implementing fraud controls to help protect your business from fraud.
When you need financing to scale your Florida business, you may want to explore different funding options to find the best loan terms. This might include small business loans, lines of credit, equipment financing and SBA loans from approved Florida lenders.
Florida’s warm climate, strong economy and tax-friendly policies make it a great place for your business. But big national banks often fail to understand Florida’s diverse business environment, applying rigid algorithmic standards that could make it more difficult to manage your business’s finances.
Seacoast is a local community bank specializing in flexible solutions built for small-business banking in Florida. With 100 years of experience and local expertise that the big banks don’t have, Seacoast offers Florida businesses a distinct advantage.
As a business owner, you may have certain tax obligations — but you might also qualify for tax credits or other incentives.
Tax obligations for Florida businesses include sales or use tax, corporate income tax (for C corps), reemployment tax and sector-specific taxes.
Florida tax incentives for businesses help promote business development and the creation of more jobs in the Sunshine State. These incentives include tax exemptions or credits for certain industries, as well as hiring- and location-based credits or other benefits.
To learn more about Florida tax incentives for businesses — including eligibility for credits, exemptions or refunds — visit the Department of Revenue website.
As one of the top states for businesses and startups, Florida continues to be a great place to start or relocate your business. And when you want to get the most out of your business banking relationship, it helps to have a community bank with the local presence and expertise to support your growth.
So whether you’re just getting started with your first business checking account or you need flexible funding solutions for the next stage in your business journey, Seacoast Bank is here to help your business thrive.
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