The 3 Steps to Registering a Business:

1. Name availability check. This ensures that your business name is not already in use by another business.
2. File Articles of Incorporation containing information on corporate name, business address, quantity and value of the shares of stock, name and address of the registered agent, name and address of initial directors.
3. Obtain a Tax ID

Each US state has different regulations and requirements for registering a business, although the basic process above will remain the same. You can find your state’s business license information here. Some even allow you to carry out a business name search and register your business online. However, before you register your business you need to decide what type of business you are going to set up.

Choosing a business structure

The most common types of businesses are: sole proprietor, partnership, limited liability company, and corporation. Each type of business has different advantages and you should look into these carefully before you choose which one you are going to form.

For eBay sellers, the most common types of business structures are C Corporations, S Corporation, Limited Liability Corporations, and Sole proprietorships. Each have different advantages, for example:

Sole proprietorships require little legal structure and allow you to take advantage of tax benefits. It works very well for a one-man operation working from home – however, you are held personally responsible for anything that might go wrong and there is no scalability.

On the other hand, Corporations offer you personal protection with limited liability and also have the ability to be expanded. On the downside, they are have a minimum taxation of about $800/year, whatever the profit/loss situation, and they also require a formal legal structure. (See Appendix A on steps for forming a C Corporation).

For more information on different business structures and their advantages and disadvantages, visit:

• http://www.entrepreneur.com/startupbasics/businessstructure/archive166108.html
• http://www.usabusinesshelp.com/structure.html
• http://www.sba.gov/smallbusinessplanner/index.html
• http://www.expertlaw.com/library/business/c_corporation.html
• http://www.morebusiness.com/getting_started/incorporating/

You may also wish to talk to your lawyer.

Incorporating in Nevada

Forming a corporation in your own state is not always the most beneficial option. The states of Nevada and Delaware, for instance, are a very popular choice for corporations as they offer significant tax benefits.

Nevada offers:

• No corporate income tax
• No taxes on corporate shares
• No franchise tax
• No personal income tax
• No I.R.S. information sharing agreement
• Nominal annual fees
• Minimal reporting and disclosure requirements
• Stockholders are not public record

Be aware however, that while the benefits of incorporation in Nevada may be substantial, if your business is located in another state, it’s possible you may have to pay your home state’s fees also.

To find out more, go to:

• http://www.corporate.com/which-state.htm
• http://www.morebusiness.com/getting_started/incorporating/d934832581.brc#2
• http://www.bizjump.com/incorporation/whats_a_corp.html
• http://www.lectlaw.com/filesh/ncp01.htm

Help with Incorporation

There are many different online companies who will help you incorporate for around $200-$400, although this can range up to $2,500 or so if you want a higher level of service – such as someone to answer phone calls, a registered agent’s services for a year, and so on.

Just some of the many companies who offer this service are:

• http://www.incparadise.com/
• http://www.bizfilings.com/
• http://www.mycorporation.com/incorporate/
• http://www.form-a-corp.com/
• http://www.companiesinc.com/
• http://www.laughlinusa.com/

Obtaining a Tax number

All businesses selling products or services that pay any kind of taxes and/or have employees must have a federal tax ID number (also known as an employer identification number or EIN). This is a number assigned solely to your business by the IRS and is used to identify your business to several federal agencies responsible for the regulation of business. If you plan on buying from wholesalers and/or importing merchandise, you will need to have a tax ID number before they will deal with you.

To set up a federal tax ID, contact your nearest Local IRS Field Office, or call the IRS Business and Specialty Tax Hotline at 800-829-4933.

The form you’ll need to fill out is IRS From SS-4 and you can download it directly from the SBA Web site.

If your business does not have employees, the IRS recommends you label the top of the form SS-4 "For Identification Purposes Only."

Appendix A – Steps to forming a C Corporation

1. Choose an available business name that complies with your state’s corporation rules.
2. Appoint directors for your corporation.
3. File formal paperwork – the Articles of Incorporation - and pay a filing fee that ranges from $100 to $800, depending on the state where you incorporate.
4. Create corporate that lay out the operating rules for your corporation.
5. Hold the first meeting of the board of directors.
6. Issue stock certificates to the shareholders of the corporation.

Obtain any licenses and permits that may be required for your business.