Steps to Start Sole Proprietorship in Georgia
If you are thinking of filing a sole proprietorship in Georgia then you need to first start with understanding the market, the state laws, and the requirements associated with conducting a business. There are certain requirements to fulfill and this can vary from one state to another like a sole proprietorship Georgia lookup for business names or knowing the licenses or permits that will be required by your company. Let us look into these important requirements in detail as they will enable you to set up a business and run it smoothly.
1. Prepare a business plan
One of the important and often undermined drivers of a sole proprietorship business is a good business plan. The need for such a plan lies in the fact that it can help your company to grow and become established after registering a sole proprietorship in Georgia. A business plan is considered a strategic plan and will help you in setting specific business related objectives based on market research, and even provides ways to develop new alliances. If you are planning to start a sole proprietorship in Georgia then a business plan should ideally focus on the following key areas:
- Executive Summary
- Mission, Goals, and Objectives
- Organizational Matters
- Personnel and Outside Services
- Risk Management Strategy
- Product or Services
- Target Audience
- Competition Analysis
- Situation Analysis
- SWOT Analysis
- Marketing Plan
- Distribution, Promotion, and Pricing
- Financial Plan
2. Choose a Georgia business name
When you start a sole proprietorship in Georgia or any new business for that matter, one of the first things to identify is a business name. The name of the company is integral to its very existence and hence needs to be well thought out. In a sole proprietorship, the company name is usually the personal name or the owners’ name although you can also opt for a fictitious name also known as the “doing business as” name. You can conduct a sole proprietorship Georgia lookup when choosing a name as there are plenty of examples available online. Some of the fundamental aspects of choosing a name for your company are:
- Keep the name as simple as possible
- The name should be easy to pronounce
- The company name should represent your product or service
- Conduct a copyright or trademark search for the chosen name
- Check for the availability of a domain name based on the company name
3. File Assumed business name
If you are wondering how to start a sole proprietorship in Georgia then the first step is to identify a name. Most sole proprietorships use a DBA name, which is also known as a fictitious name or an assumed name. It is because this form of business is not considered a separate legal entity from its owner. If you want to start a sole proprietorship in Georgia using any other name apart from your name then you will need to file a Georgia trade name.
For example: If your name is John Reese and you want to start a cookie store in Georgia, then you can simply use your name like ‘John Reese’. Alternatively, if you want to give it a more personal touch then you can name it “John’s Crumbling Cookies”. In such a scenario you will need to file a DBA or trade name before you can start a sole proprietorship in Georgia. We at IncParadise can help you with the filing of a DBA (doing business as) in this state.
It is important to note that you need to conduct a sole proprietorship Georgia lookup prior to filing a trade name as this will ensure the name is already not in use.
4. Get EIN
Filing a sole proprietorship in Georgia means that you will be required to pay income tax on your personal return since the business and the owner are considered the same. Normally, you will need the Social Security number (SSN) to file personal income tax but in specific scenarios, you may be required to apply for and obtain an Employer Identification Number (EIN). After registering a sole proprietorship in Georgia, you may need to apply for an EIN if:
- Your company has employees
- You have a Keogh plan
- You are filing pension plan returns
- You have to file Chapter 7 or Chapter 11 bankruptcy
- You have to file sales tax in Georgia
5. Obtain necessary licenses and permits
Once you start a sole proprietorship in Georgia, you need to ensure the business is operational or you are able to transact in the city or county your company is based in. This is possible only when you have obtained the necessary licenses and permits. You may require multiple licenses or permits depending on the type of business activity. Business licensing can be categorized under:
- County or local licensing
- Professional or regulated licensing
After registering a sole proprietorship in Georgia, you will need to apply for local licensing from the county office or professional license. The Georgia Secretary of State Licensing Board is the top agency when it comes to licensing as well as regulating specific professions. However, some professionals like law and health care are licensed by other state departments.
If your profession or industry is not listed with the State Licensing Board then you will have to check with the Georgia State Agency governing the industry or profession. In addition to local or county licenses, you may also have to obtain zoning clearances and building permits necessary to start a sole proprietorship in Georgia.
If you are wondering how to start a sole proprietorship in Georgia and obtain the right licenses and permits, then our Business License Research Report service can help you. This is a detailed research report that contains a list of filing instructions, supporting document requirements, and fees for all business licenses and permits for your sole proprietorship business in Georgia.
6. Open a bank account for your Georgia business
A sole proprietorship business is a single owner driven and controlled business. Since the business and the owner are not considered separate entities like in an LLC; you will be required to file a personal income tax return. Hence, it is very important to ensure the revenue generated or expenditures of your business are separate from your personal bank account. This can be made possible by opening a business bank account using which you can make business related transactions. You can open this business account before or after filing a sole proprietorship in Georgia.
7. Report and pay taxes
Registering a sole proprietorship in Georgia means that you will be required to report taxes annually. As a sole proprietor, you will be required to establish a Georgia Tax Center (GTC) account with the Department of Revenue (DOR). You will need the following information for registering such an account:
- Social security number (SSN) or Employer Identification Number (EIN)
- Any recent federal adjusted gross income (FAGI) or Adjusted Gross Income (AGI)
- Your NAICS code
- The type of tax account you want to register for
When you start a sole proprietorship in Georgia, depending on the type of business activity, you may also be required to collect Georgia sales tax. This is especially true for businesses involved in retail sales of tangible personal property as well as certain services like the sale of accommodation and limo services among others…