Pennsylvania LLC Annual Filing Requirements

The annual requirements in Pennsylvania are governed by the Pennsylvania Consolidated & Unconsolidated Statutes. The Pennsylvania LLC annual requirements may be different compared to other entity types like corporations, partnerships, and sole proprietorships. If you start a limited liability company in this state then the mandatory annual requirements are categorized as the following:

Annual Registration

If you form a professional limited liability company (PLLC) in Pennsylvania then the annual registration will be a part of your mandatory requirements. Annual registration is also obligatory if you establish a foreign LLC engaging in professional services. This is one of the most important Pennsylvania LLC annual requirements and the Certificate of Annual Registration must be filed by April 15th each year pursuant to 15 PA Cons Stat § 8998 (2020). This filing should not be associated or mistaken for the Pennsylvania LLC annual report, which is a separate document. You are required to file this certificate with the Pennsylvania Department of State, Bureau of Corporations and Charitable Organizations. The fee is dynamic and will be $520 multiplied by the total number of members in the said LLC. If you fail to file the Certificate of Annual Registration, you will be subjected to heavy penalties.

State Business Tax

Every limited liability company has two very important annual requirements that they must be compliant with, which involve filing your state business taxes and the Pennsylvania decennial report. Since an LLC is considered to be a pass-through entity the company is not required to pay taxes. Instead, the members of the said company will have to file personal income taxes at a rate of 3.07%. The members of the LLC will also have to file federal self-employment taxes at a rate of 15.3%, which includes 2.9% for Medicare and 12.4% for Social Security.

State Employer Taxes

State employer taxes are another one of the important Pennsylvania LLC annual requirements. An employer can be an individual like a sole proprietorship business, or other entity types like a partnership, association, LLC, corporation, and government body among others. The Internal Revenue Code requires such entities to withhold federal income taxes from the wages paid to their employees. The Pennsylvania Department of Revenue declares that if a limited liability company in the state employs people then the LLC is required to withhold personal income tax at a rate of 3.07 percent.

Decennial Report

Every state has different annual requirements although the most common requirement is the annual report. In the state of Pennsylvania, you will be required to file a Decennial Report, which is filed once every 10 years. Let’s look at an example to understand these Pennsylvania LLC annual requirements better.

Annual Report from 2024

Pennsylvania is one of the few states that do not have an annual report. However, businesses are required to file a Decennial Report. The annual reporting requirements in the state are going to change starting in 2024 as the state will introduce a Pennsylvania LLC annual report like most other states. The Pennsylvania Act 122 took effect on January 2, 2023, and repealed the decennial report requirement. The new Pennsylvania LLC annual requirements will include the following:

• Name of the LLC
• Jurisdiction of Formation
• Registered office address in the state
• Entity number issued by the Pennsylvania Department of State
• Name of at least one member or partner
• Names and titles of the principal officers
• Address of the principal office

Do you want to file an Annual Report for your Pennsylvania LLC?

Pennsylvania INC Annual Filing Requirements

When you form a corporation in Pennsylvania, there will be different filing requirements apart from the Articles of Incorporation. The important filings for the Pennsylvania Corporation annual requirements include filing your taxes and annual reports. This will be applicable for both domestic and foreign corporations operating in the state and governed by the Pennsylvania Consolidated & Unconsolidated Statutes. Let’s look in detail at the Pennsylvania Decennial Report and other annual requirements.

Decennial Report

The Pennsylvania state business law requires all corporations and other associations registered with the Department of State to file a Pennsylvania Decennial Report if such entities have not made any filings in a period of 10 years since incorporation. This report is an integral part of the Pennsylvania Corporation annual requirements and is applicable for both domestic and foreign corporations.

Corporation Taxes and Annual Fee

Once you’ve incorporated your new business in the state of Pennsylvania, you will need to be compliant with all state requirements. The Pennsylvania Corporation annual requirements for domestic and foreign entities are almost the same, especially when it comes to filing of taxes. A business corporation operating in the state will be subjected to corporate net income tax, which has a flat rate of 8.99 percent. The corporate taxes unlike a Pennsylvania Decennial Report have to be filed each year on or before April 15th. This tax has to be filed with the Department of Revenue. Apart from this, you may also be required to file net income taxes, franchise taxes, capital stock taxes, sales and use taxes, and corporate loans taxes.

Annual Report from 2024

Most states in the USA require businesses to submit an annual report as part of the state’s annual requirements. Although a Pennsylvania Decennial Report (once in 10 years) has been the state requirement for corporations, it is now about to be changed. An annual report will be introduced as a part of the Pennsylvania Corporation annual requirements. This report has to be filed by corporations and nonprofit corporations before July 1st of each year beginning in 2024. The annual filing fee for the report is $7. The Pennsylvania annual report for corporations will include the following information:

• Name of the corporation
• The jurisdiction of incorporation
• The name of at least one director or partner
• The names as well as titles of the principal officers
• The address of the principal office
• The entity number or entity ID issued by the Pennsylvania Department of State

Thinking of filing an Annual Report for Pennsylvania Corporation?

Need any Assistance with Pennsylvania LLC or INC Annual Filings?

Annual requirements or compliances are different for each state, but most states have certain common requirements like filing your taxes and annual reports. The Pennsylvania Decennial Report is being repealed and the new annual report is being introduced in 2024 as a part of Pennsylvania Corporation annual requirements or LLC annual requirements.

Online Business in Pennsylvania

An online Business is also known as an e-business (electronic business) and it encompasses any form of business or commercial transaction that occurs over the Internet. E-commerce refers to an online business and this term has often been used interchangeably with e-business. If you’re planning to start an online business in Pennsylvania, you’ll need to understand the difference. An e-commerce business conducts online transactions, while e-businesses provide services and activities utilizing the Internet.

What are the biggest benefits of doing business online in Pennsylvania?

Pennsylvania’s strategic location allows the state to be well-connected to the rest of the nation. The state boasts of a state-of-the-art infrastructure, a strong transportation network, and access to a skilled workforce. If you want to start an online business in Pennsylvania then it’s time to focus on some of the benefits of operating an online business in this state.

• Access to the Internet – The most important component for any online business is reliable access to the Internet. Access to the Internet has grown in Pennsylvania from 81.2% in 2015 to 93.2% by 2020. According to a study by the Pennsylvania State University, access to the Internet has grown in Pennsylvania from 81.2% in 2015 to 93.2% by 2020. A federal program called the Broadband Equity, Access, and Deployment (BEAD) program has also been initiated in Pennsylvania to help increase access to high-speed Internet.
• Lower start-up costs – Startup and operational costs are a major concern for any new business. A lower startup cost is one of the top advantages when you start an e-commerce business in Pennsylvania. Depending on the type of startup and inventory, the operational costs would also be significantly lower than that of a traditional company. The state of Pennsylvania also provides several incentive programs for small businesses including grants and other funding programs.
• Flexibility – You can start an online business in Pennsylvania from your home or even from co-working spaces. This provides flexibility to an e-business while ensuring that you can reach out to customers in the state, the nation, and globally. You can even adjust your work schedule for your convenience to successfully balance the responsibilities between your work and personal freedom.

Top online business ideas in Pennsylvania

Whether you want to start an e-commerce business in Pennsylvania or any other type of online business, the state provides many resources and incentives. If you’re still trying to decide which type of business you want to start, here is a list of top and trending online business ideas to choose from:

• Dropshipping – This business model is one of the highest trending online business ideas today. Dropshipping is a fulfillment model where you as an entrepreneur outsource the handling and shipping of a variety of products to a third party. To legally operate this type of business, you will require an online business license in Pennsylvania. This particular type of business model is popular due to its high efficiency and low overhead.
• SEO specialist – Due to increasing demand, this has become one of the most favored online business ideas. This could be the right business model for if you want to start an online business from home in Pennsylvania. The role of an SEO specialist or expert is to identify online marketing strategies and tactics that will help increase the number of visitors to a specific website.
• Graphic Designer – Graphic design has existed since the advent of advertising. Easier access to high-speed Internet and the availability of a myriad of digital tools have made it one of the best online businesses to start. If you have the necessary skills then you can easily start this type of business from your home.
• Mobile Apps Development – The advancement of technology has reached unparalleled heights with mobile application development. This involves creating software for smartphones and tablets, as well as digital assistants. Mobile apps are used across all industries from retail and telecommunications to health, advertising, and insurance. You may need to obtain an online business license in Pennsylvania to conduct this type of business.
• Virtual Assistant – A virtual assistant (VA) is a type of specialized service that can perform a wide variety of tasks. A virtual assistant is also known as an independent contractor and can provide administrative services to customers based on their requirements.

Starting an Online Business in Pennsylvania

Pennsylvania is also known as the Keystone State, and it is home to diverse industries composed of companies that started from home, e-commerce businesses, and traditional companies. If you have a great idea and want to start an e-commerce business in Pennsylvania, then you will need to understand and follow the state’s small business guidelines. The following processes will help you understand the state and business-specific requirements, as well as the documentation needed for your online businesses.

1. Prepare your Pennsylvania online business idea and plan

The first and foremost area to focus on before you start an online business in Pennsylvania is creating a strategic plan. This will be your business plan and it’s a detailed outline that will set the course and determine the success of your online company. This type of plan refers to the starting phase, operational, financial, and marketing aspects. It’s important to remember that the plan should be designed based on the products or services offered. Because it will be based on the requirements of each e-business, no two plans can be similar. Some of the key components of the plan include:

• Business objective
• Business structure
• Mission and vision
• Short and long-term goals
• Defining risks
• Market research
• Competitive analysis
• Customer or targeted audience research
• Products and services
• Revenue model
• Logistics and Operations plan
• Internet marketing strategy
• Financial plan

2. Choose your Pennsylvania online business name

Once you have an online business idea, the next step is to register it with the state, which will allow you to become legally operational. Choosing a good business name is a chief requirement to become legally operational in the state. The name you select will not only be used to register your company in the state of Pennsylvania, but it will also serve other purposes such as banking, marketing, and booking a domain name among others. Here are some general tips for choosing the right name to start an online business from home in Pennsylvania:

• Keep the e-business name short, simple, and memorable.
• The name should have a connection to the product or services offered.
• To reserve the business name with the state of Pennsylvania, you will need to check the name availability.
• Follow all business naming guidelines as mentioned in the Pennsylvania Consolidated and Unconsolidated Statutes.
• Ensure the availability of the domain name for the chosen e-commerce business name.

3. Register your online business with the Pennsylvania Department of State

In order to make a business operational, you will need to apply for an online business license in Pennsylvania. However, it is important to register your e-business first. This process is known as a new business formation or incorporation and will vary depending on the type of entity structure you have chosen. So, if you choose to form a limited-liability company, then you will need to submit a Certificate of Organization or Articles of Incorporation for a corporation.

Start your online business in Pennsylvania today!

4. Obtain all necessary licenses and permits for your online business

Once you’ve registered your e-business with the state, the next step is to obtain the necessary online business license in Pennsylvania. Licenses and permits will help you to conduct transactions in the state and the licensing requirements and regulations will vary according to:

• The city or county you operate from
• The industry your business is based in
• Business activity

5. Buy a website domain and build an e-commerce website

Choosing the right domain name is both essential and important when planning to start an online business in Pennsylvania. Your domain name is an integral part of your website’s address and you can use your state registered name for this. The name you choose for your domain will help your customers find your website. It’s important to ensure that the domain name is easy to remember and may even describe what the site is about. There are two ways by which you can obtain a domain name:

6. Get an EIN and File your taxes

Apart from an online business license in Pennsylvania, another important requirement for most e-commerce businesses is to file your taxes. Your business activity, entity structure, and annual sales will determine the type of taxes you will have to file, and you will need an employer identification number (EIN) to do this. This is a type of Tax ID number that is issued for free by the Internal Revenue Service (IRS).

7. Open a bank account

If you want to start an e-commerce business in Pennsylvania, or any other online business that offers products or services then having a separate bank account is highly recommended. This account is known as a business bank account or checking account. Since customers will be submitting their payment online, you will need a payment gateway, as well as a proper bank account for receiving funds. The account will also help you with keeping track of your sales revenue and expenses.

8. Comply with taxes and other regulatory requirements

Once you start an online business in Pennsylvania, you will be required to comply with annual maintenance as well as tax requirements of the state. Some of the important requirements include:

• There are different types of taxes applicable in the state of Pennsylvania. The type of taxes that your e-business needs to file will vary according to the business activity and entity structure. If you start an e-commerce business in Pennsylvania, then one of the mandatory taxes that you will need to file is the sales tax. You may also be required to file personal income taxes.
• As a part of annual maintenance, you will be required to file a Decennial report. The laws will change soon, and you may be required to file an annual report each year starting from 2024-2025.
• Once you’ve obtained an online business license in Pennsylvania, it is important to maintain your renewal. The renewal time and fee may vary depending on the issuing authority or the county your business is operating from.

9. Market your business

Building a new business from scratch requires many strategies to work simultaneously and in sync to achieve success. If you start an online business from home in Pennsylvania, the next part of your strategy should be to focus on marketing the services, products, or the brand itself. You will need to contrive a plan that will help drive customer traffic to your website or online store. Some of the important areas to focus on include:

• Using search engine optimized (SEO) content.
• Create a strong email marketing strategy while continuing to build your email list.
• Boost your digital engagement by using different social media platforms like YouTube, Instagram, etc.
• Use of Mobile commerce (m-commerce) to reach out to the targeted customers.
• Use Google Ads for search engine marketing and advertise on various social platforms.
• Create meaningful partnerships with other brands to enhance cross-promotion.

Looking to start an online business in Pennsylvania?

You can start an online business in Pennsylvania based on trending e-business ideas. Pennsylvania provides high speed Internet access and other infrastructural support and resources to help you establish your brand. There are specific processes that you would be required to follow based on Pennsylvania’s Consolidated and Unconsolidated Statutes. IncParadise can assist you with ensuring that you can start an e-commerce business in Pennsylvania with ease.

Pennsylvania LLC or Corporation

The state of Pennsylvania offers many benefits or advantages to new business owners or companies. You can even choose from a wide variety of entity structures although the most popular are a limited liability company (LLC) and C-corporation. Choosing the right type of entity structure is a very important decision and should be taken very seriously. You will need to consider several factors when making a decision such as the possible tax consequences, the annual maintenance cost of a Pennsylvania Corporation or an LLC, and state laws. You will need to even consider the legal advantages each type of entity provides including protection against legal liability.

Which business entity should I choose for my Pennsylvania business?

Once you have decided to start a new business, it becomes important to identify the right structure. Each structure type has its own advantages and disadvantages. It’s important to note that the legal structure of your company will determine the business tax rates, management, registration process, paperwork requirement, hierarchy, and even fundraising prospects among others. If you plan to incorporate then the cost to form a Pennsylvania Corporation will be different from that of a sole proprietorship, partnership, or limited liability company. The two most popular structures are C-Corporations and LLCs. Let’s look at some of the prime characteristics of an LLC and a corporation.

• Ownership – Ownership is an important element for any legal structure. A corporation has shareholders who are considered to be owners, while an LLC can have a single owner or multiple owners, also known as members.
• Limited Liability Protection – One of the common advantages for both LLCs and corporations is limited liability protection. In either structure type, the owners will not be held responsible for any of the company debts.
• Startup costs – The chosen structure will play a key role in determining the overall costs to establish and operate a company. The formation cost of a Pennsylvania LLC or corporation is an important aspect of new business formation.
• Private or Public – A C-corporation is regarded as a publicly traded entity, while a limited liability company is a privately held entity.
• State or Business Tax – Taxes are viewed as a component of annual maintenance cost of a Pennsylvania Corporation or LLC, and the type and amount of taxes will vary depending on the legal structure.

Pros and Cons of Forming an LLC or Corporation in Pennsylvania

The entity structure that you choose will influence every aspect of your business from the day-to-day operations to the annual maintenance, taxes, and various risks associated with personal assets. If you’re planning to form an LLC or a corporation in Pennsylvania, it’s necessary to recognize each entity’s pros and cons including the cost to form a Pennsylvania LLC or a corporation.

Pros of an LLC or Corporation

• The Pennsylvania LLC annual fee is the same for a corporation.
• An LLC enjoys pass-through taxation on profits.
• You can start an LLC with a single member.
• An LLC enjoys a lot of management flexibility.
• The initial paperwork for an LLC is quite less in comparison to certain other structures.
• A corporation or an LLC can choose to be taxed as an S-Corporation.
• A business corporation can issue stock.
• Venture capitalist (VC) firms find corporations more attractive when compared to other entity structures.
• A Corporation enjoys perpetual life.

Cons of an LLC or Corporation

• The overall cost to incorporate in Pennsylvania may be higher than the cost to form any other entity.
• A corporation unlike other entities goes through double taxation on profits earned by the company.
• It’s difficult for an LLC to raise capital vis à vis a corporation.
• A limited liability company doesn’t enjoy perpetual existence.
• Depending on the state of formation, LLC members are subjected to self-employment taxes.

Pennsylvania LLC Cost

A Pennsylvania Limited Liability Company is one of the most selected entity structures in the state due to its numerous benefits. If you are thinking of registering your startup as an LLC then it’s important to know the cost to form a Pennsylvania LLC in advance. There are various expenses involved in forming and operating this type of business. Let us take a look at the various costs you may incur.

Cost for forming Pennsylvania LLC

The formation cost of Pennsylvania LLC consists of one-time costs, as well as recurring costs. These include:

• The LLC formation processes and fees are different from other entity structures. The first step towards registration is to file the Name Reservation Application in compliance with 15 Pa.C.S. § 208. This will require a fee of $70.
• According to state laws, you will need to hire and maintain a registered agent for service of process. The cost or fee would vary depending on the RA service you have chosen.
• The third and most important expense is the cost to form a Pennsylvania LLC. You will have to file a Certificate of Organization along with a $125 filing fee. If you want to expedite the process then there will be an additional fee varying from $100 to $1000 depending on the chosen service.

Annual maintenance cost for a Pennsylvania LLC

Once you’ve registered your limited liability company in Pennsylvania; it’s important to ensure that your company is in compliance with all state requirements including the LLC annual maintenance. This will include the Pennsylvania LLC annual fee. The costs involved include:

• Annual Report – Currently, a limited liability company is required to file a Decennial Report, which is filed once every ten years. The fee required is $70. This will change in 2024-2025 as the state is planning to introduce an annual report. The Pennsylvania LLC annual fee may change once it is introduced.
• Taxes – A limited liability company in Pennsylvania is considered to be a “Pass-through Entity”. Hence it will not be required to file any taxes. Instead, the members will have to file taxes on their share of profits. This type of cost to form a Pennsylvania LLC is a recurring cost as the taxes have to be filed each year. You may also be required to file other taxes as well. The cost of all forms of taxes will vary according to the rates of applicable taxes.
• Business Licenses – One of the important annual formation costs of a Pennsylvania LLC is the business license fees. This is a recurring cost as licenses and permits have to be renewed each year. The fee for licenses will vary according to the type of license and the number of licenses or permits required by an LLC.

Form your new LLC in Pennsylvania Today!

Pennsylvania Corporation Cost

Many entrepreneurs find C-corporations to be a favorable structure because it is attractive to investors. A major advantage of a corporation is its ability to raise capital, which is necessary for any form of business. When planning to incorporate your startup in Pennsylvania, you will need to be mindful of the two types of expenses required which include the initial or one-time costs, and the recurring costs. Let’s look at the cost to form a Pennsylvania Corporation.

Cost of Forming Corporation in Pennsylvania

The cost to incorporate in Pennsylvania is dependent on several factors but mostly on whether you want to form a domestic entity or a foreign company. The important costs related to incorporation in this state are comprised of the following:

• Name reservation is one of the first components of the cost to form a Pennsylvania Corporation. First, you will need to choose a company, then you will need to reserve it using the Name Reservation Application in compliance with 15 Pa.C.S. § 208. The fee for this process is $70. If you choose a fictitious name also known as DBA (Doing Business As) then the fee will be different.
• According to the 2020 Pennsylvania Consolidated & Unconsolidated Statutes, 15 PA Cons Stat § 1507 (2020), you will need to hire and maintain a registered agent for service of process. The cost or fee would vary depending on the service you have chosen.
• The fee for registering your company with the state is the most important cost to incorporate in Pennsylvania. You will have to file the Articles of Incorporation pursuant to 15 PA Cons Stat § 1306 (2020). The fee for this service is $125. You can expedite the process for an additional fee varying from $100 to $1000.
• You’ll also have to officially publish a notice of intention to file the articles of incorporation. This has to be published in two newspapers that have general circulation and one in a legal newspaper. The fees to publish will vary depending on the newspaper.

Annual maintenance cost for a Pennsylvania Corporation

Apart from the initial cost to form a Pennsylvania Corporation, there will be other expenses associated with annual maintenance of your company. The costs involved are as follows:

• Annual Report – Currently, corporations in Pennsylvania are required to file a Decennial Report. This type of annual report is filed once every ten years. The fee for this service is $70 and is considered an annual maintenance cost of a Pennsylvania Corporation. This will change in 2024-2025 as the state is planning to introduce an annual report and the fee for that filing may be different.
• Taxes – A Pennsylvania corporation is required to file corporate taxes at the flat rate of 8.99 percent. Apart from this, other taxes may be applicable and will vary depending on the business activity. Taxes are considered to be an important component of the annual maintenance cost of a Pennsylvania Corporation and are a recurring cost that is filed each year.
• Business Licenses – Once you’ve incorporated in Pennsylvania, you will need to apply to obtain the necessary business licenses and permits. These licenses will allow your company to operate in the state. This is an integral component of the cost to form a Pennsylvania Corporation, and is considered to be a recurring cost as licenses must be renewed each year, or as specified by the state or licensing board.

Register a Corporation in Pennsylvania with ease!

Need any Assistance in Forming Your Pennsylvania LLC or Corporation

Pennsylvania has several types of entity structures that you can choose from. An LLC or a corporation are two of the most popular structures, although their registration processes and fees may vary. The cost to form a Pennsylvania LLC or corporation will vary for domestic and foreign entities. We, at IncParadise can provide valuable assistance by handling the requirements for a new business formation or incorporation in the state.

Pennsylvania Corporation

If you’re planning to register a Corporation in Pennsylvania then you will find that this could be a good decision as the state has a healthy business climate. A corporation is a type of entity that offers many advantages and to top it, the state also offers several benefits in terms of resources, a supportive infrastructure, and business incentives. Employees are a primary requirement for every new business and the state provides a highly-educated and skilled employee pool. Pennsylvania is also quickly becoming a platform for recruiting STEM (science, technology, engineering, or mathematics) workers. One of the benefits of incorporating in Pennsylvania is its emergence as a startup ecosystem complete with accelerators and incubators.

What is a Pennsylvania Corporation?

A corporation also known as the traditional C Corporation is one of the most popular business structures in Pennsylvania. To form a Corporation in Pennsylvania, the first thing you will need to understand is the type of corporate structures available. It is a type of legal entity where owners and shareholders are taxed separately. This means that the assets and income of owners or shareholders are separate from that of the C Corporation. If you want to know how to form a Corporation in Pennsylvania then it is important to identify the type of corporations you can form in this state. They include:

• Business Corporations (C-Corp)
• Business Corporation (S-Corp)
• Foreign Corporations
• Nonprofit Corporations
• Professional Corporations
• Non-stock Corporations
• Benefit Corporations
• Statutory Close Corporations

What are the benefits of incorporating in Pennsylvania?

Entrepreneurs prefer to register a Corporation in Pennsylvania as this type of business structure has several advantages over other entity structures. Some of the advantages include:

• Limited liability – Limited Liability is one of the major benefits of incorporating in Pennsylvania. This simply means that a corporation limits the liability of the owners or shareholders and thus if such a company is sued, then the owners or shareholders will not be personally liable for any damages or debts. This type of entity protects the personal assets of the owners or shareholders.
• Access to capital – Easy access to capital is one of the important reasons why entrepreneurs prefer to incorporate in Pennsylvania. Incorporation helps raise money for the business through the issuance of stock, which can be sold to investors for raising capital. Apart from this, venture capitalists (VCs) find it easier to invest in C corporations in comparison to other kinds of entities.
• Increased credibility – One of the important benefits of incorporating in Pennsylvania is that it will help the company create a better professional image and establish higher credibility for potential partners, customers, suppliers, employees, and vendors.

Starting a Pennsylvania Corporation

Pennsylvania is famous for its strategic location and is well connected to New York City and Washington, DC. Entrepreneurs and corporations involved in manufacturing and anything related to transportation and logistics find the state’s strategic location and infrastructure critical for overall growth. If you’re also planning to form a Corporation in Pennsylvania then there are several important processes that you will need to focus on.

1. Name a Pennsylvania Corporation

If you’re planning to incorporate, one of the first steps to take is to identify a corporate name. The business name plays a key role when it comes to building a brand image. The corporate name will help to create a noteworthy first impression with your partners and customers. You can finalize a corporate name by following state naming guidelines and conducting a Pennsylvania Corporation search. The Pennsylvania naming guidelines state that a corporation must include words like “corporation”, “incorporated”, or abbreviations like “corp.”, or “inc.” The naming guidelines are governed by 15 PA Cons Stat § 5303 (2020).

2. Appoint a Pennsylvania registered agent

When it comes to the new business formation or incorporation process, there are certain state business requirements that an owner must fulfill. To incorporate in North Carolina, your first step will be to hire and maintain a registered agent in the state pursuant to the 15 PA Cons Stat § 1507 (2020). A registered agent could be an individual or a company that has agreed to accept all legal mail on behalf of your corporation. This is known as Service of Process.

3. Choose the Pennsylvania Corporation’s initial directors

Another important step when learning how to form a Corporation in Pennsylvania is choosing the entity’s initial directors. These are also known as the first directors of the corporation and will also be named in the articles of incorporation. They are normally elected through an organizational meeting or by those individuals who have been appointed by the initial owners or shareholders of the said entity. The initial directors will have to serve until the shareholders of the corporation hold their first meeting for electing their successors. The board of initial directors assists in making important decisions pertaining to several areas of the corporation like the adoption of bylaws and the issuance of shares among others.

4. File Articles of Incorporation with the PA Department of State

Once you’ve conducted a Pennsylvania Corporation search and reserved your business name, the next step is to incorporate. You will be required to prepare and submit the Articles of Incorporation pursuant to the 15 PA Cons Stat § 1306 (2020). You can form a Corporation in Pennsylvania by submitting the articles to the Pennsylvania Department of State, Bureau of Corporations and Charitable Organizations along with a fee of $125. It is important to note that you will have to officially publish (advertisement) a notice of intention to file articles of incorporation pursuant to the 15 PA Cons Stat § 1307 (2020).

Are you thinking of starting a Pennsylvania Corporation?

5. Get an EIN

If you’re planning to register Corporation in Pennsylvania, you may be obligated to fulfill certain annual requirements. One such requirement is to file corporate and other business taxes. In order to file taxes, you will have to apply to obtain an Employer Identification Number (EIN). This is a 9-digit unique identifier assigned by the Internal Revenue Service (IRS). It is also known as the Federal Employer Identification Number (FEIN) and will allow corporations to open business bank accounts.

6. Prepare bylaws for your Pennsylvania Corporation

Another significant requirement for any new corporation is the corporate bylaws. Whether you register a Pennsylvania Corporation online or offline, this is a mandatory requirement that the entire company’s functions are dependent on. Hence, the bylaws are known as the governing rules and are the first act of the initial board of directors. These guiding principles direct the initial board of directors in their work of overseeing the day-to-day operations of the said corporation.

• Statement of Purpose
• Board of directors
• Titles of the officers of the corporation
• Shareholders owning stock in the company
• Committee and committee members
• Procedure and timeline for annual meetings
• Issuance of stock to shareholders
• Rights and responsibilities
• Conflicts of interest
• Amendment to the Bylaws

7. Hold an organizational meeting

Once you file the Articles of Incorporation to incorporate in Pennsylvania, the entity will be required to hold an organizational meeting. This is an initial meeting that is considered to be a basic organizational formality for a corporation that has been organized under the laws of the US state of Pennsylvania. This meeting is typically not held in person and is instead documented through the unanimous written consent of the initial board of directors of the company. Some of the key areas that the organizational meeting focuses on are:

• Approving corporate bylaws
• Drafting the articles of incorporation
• Distribution of initial shares
• Election of officers
• Voting to accept the stock certificates
• Approving the corporate seal

8. Open a bank account for your Pennsylvania Corporation

There are many benefits of incorporating in Pennsylvania but there are certain points to consider before or after incorporation. One major point of focus is conducting financial transactions with ease. This is only possible if you’ve opened a business bank account. This type of bank account is also known as a checking account and needs to be kept separate from your personal bank account. One of the reasons companies prefer a corporate banking account is because it helps to improve the entity’s overall credit score and keeps track of income and expenditures.

9. Issue stock

If you’ve decided to form a Corporation in Pennsylvania then your company will be required to issue stock as governed by Title 15, 2020 Pennsylvania Consolidated & Unconsolidated Statutes, § 1528 and § 7705. According to Pennsylvania statutes, you can issue capital stock designated as membership shares. The shares of such a corporation will be represented by certificates and in the absence of these; they will be known as un-certificated shares. A corporation issues stock for raising funds that will help the business operate. The holder of such stock will be known as a shareholder and will certainly have a claim to a part of the assets and earnings of the corporation.

10. Obtain necessary licenses and permits

Once you’ve incorporated in Pennsylvania, you will be required to obtain the necessary business licenses and permits. You will not be able to operate your business or conduct transactions in the state without it. You will need to conduct a Pennsylvania Corporation search for licenses applicable specifically to your company, which will be determined by:

• The industry your corporation specializes in
• The city or county your business is operating from

11. Comply with other tax and regulatory requirements

Once you register your Corporation in Pennsylvania, you will be required to comply with state annual maintenance requirements. One of these major requirements is filing Pennsylvania’s annual report currently known as a Decennial report. This is one of the few states where a Decennial Report has to be submitted once every 10 years pursuant to 54 PA Cons Stat § 503 (2020). The Decennial report will be replaced by an annual report from 2025 onwards.

Know more about starting a Pennsylvania Corporation

If you have decided to incorporate in Pennsylvania but are faced with several queries then this section will help you. This section deals with queries specific to various aspects of incorporation such as the corporate name, starting costs, dissolution, S Corporation, and foreign corporation among others.

Why register a Corporation in Pennsylvania?

The many benefits of incorporating in Pennsylvania make it a favored destination for entrepreneurs and startups. Some of the top advantages are:

• The state provides a lot of support and resources for small businesses
• It’s geographic location is of utmost importance and has a strong transportation infrastructure for B2B (business-to-business) and B2C (business-to-consumers)
• It is home to world-class universities and a highly skilled workforce
• Cities like Pittsburgh are home to high-impact industries like cyber-security, robotics, energy, artificial intelligence, health, and life sciences.
• When you form a Corporation in Pennsylvania, you will be able to leverage state grants programs, tax incentives, and other funding programs.

How do I know if my Pennsylvania Corporation name is available?

The incorporation process requires you to provide a company name. First, you will need to identify a name that is in compliance with state naming guidelines. The next step would be to conduct a Pennsylvania Corporation search. This is also known as a name availability search and will indicate if your chosen name is available for reservation or is already in use.

What will be the cost to form a corporation in Pennsylvania?

If you want to register a Corporation in Pennsylvania then you will be required to submit Articles of Incorporation for a domestic entity. The initial cost to register a Pennsylvania C-Corporation is $125. If you want to expedite the process then there will be an additional fee depending on the chosen expedited service, like the fee for same-day service is $100, while a one-hour service is $1,000. Apart from this initial incorporation cost, there will be other expenses such as the name reservation, ​Articles of Amendment, application for business licenses and permits, and filing of annual reports among others.

Can I register an S Corporation in Pennsylvania?

Yes, you can elect for the S-Corporation tax designation in Pennsylvania. S corporation is basically a tax designation and is often beneficial for those business owners who receive large distributions apart from their salary. In order to become an S Corporation, you will be required to submit a completed 2553 form (Election by a Small Business Corporation).

Do I need a business license for my Pennsylvania Corporation?

Yes. You may require single or multiple business licenses depending on the industry, the location of your company, and the business activity.

Can I register a foreign Corporation in Pennsylvania?

Yes. You will need to apply for the foreign qualification process to operate your business in this state. You will need to submit a Foreign Registration Statement to incorporate in Pennsylvania. This document is also known as a certificate of authority and you have to submit it pursuant to 15 PA Cons Stat § 412 (2020). You will also be required to officially publish a notice of intention to conduct business in this state pursuant to 15 PA Cons Stat § 4124 (2020).

How can I dissolve my Pennsylvania Corporation?

If you want to dissolve your corporation at any given point in time, then you will need to submit Articles of Dissolution-Domestic Corporation, along with a fee of $70. You will also be required to submit tax clearance certificates from the Department of Revenue as well as from the Bureau of Employment Security.

Ready to Start a Pennsylvania Corporation?

Pennsylvania offers several types of business structures for you to choose from. Although, there are many benefits of incorporating in Pennsylvania by comparison to other business structures. For domestic or foreign entities, if you want to incorporate in Pennsylvania, IncParadise can assist you with the process of incorporation.

LLC in Pennsylvania

First-time business owners prefer to form an LLC in Pennsylvania because the state provides effortless access to business resources and the infrastructure necessary for steady operations and company growth. Pennsylvania’s good business location indicators include a strong transportation system, a lower startup cost, a higher skill base, and is currently experiencing remarkable growth through a period of technological renaissance. The state provides a variety of incentive programs and access to funds, which is a crucial element for those planning to start an LLC in Pennsylvania.

What is a Pennsylvania LLC?

A Pennsylvania limited liability company (LLC) is a type of private limited company. It has a corporate structure that helps to protect its owners from any liabilities that the company may be responsible for. The process to register a Pennsylvania LLC will depend on whether it’s a domestic company or a foreign entity. The IRS defines a limited liability company as a “pass-through entity” for tax purposes, and its tax status can also be converted to an S Corporation. You can start an LLC in Pennsylvania as a single-member LLC or a multi-member LLC.

What are the benefits of forming an LLC in Pennsylvania?

A limited liability company is one of the most preferred structures to form in the USA and its formation is governed by state statutes. If you want to form an LLC in Pennsylvania then it’s important to identify the benefits that this type of structure has to offer. Let’s look at some of the top advantages:

• Limited Liability – If you’re planning to form a Pennsylvania LLC online, then one of the greatest advantages of this type of structure is the limited liability protection. This simply means that the owners’ and members’ private assets will not be at risk if the LLC fails. Their personal assets cannot be seized as repayment for any debt obligations or any legal claims.
• Pass-through entity – A pass-through entity is also known as a flow-through entity. It refers to a taxation where all the income is passed on to the members or owners of the business. Unlike a corporation, where the company files a corporate tax, an LLC is not required to file any taxes. Instead, the owners or members are required to file personal income taxes. This helps to avoid double taxation.
• Flexible profit distribution – When you form an LLC in Pennsylvania, one of the many benefits you can look forward to enjoying is that this type of structure allows more flexibility in the distribution of profits to their members or owners. This flexibility exists because a limited liability company has a simple and adaptable business structure.

Forming an LLC in Pennsylvania

Thanks to its strategic location and abundance of a highly skilled workforce, this state is easily the right destination for when you’re ready to start a business in Pennsylvania. You’ll need to be mindful of the various steps and processes required to successfully form an LLC. Let’s take a look at some of the important procedures for starting your LLC in this state.

1. Choose a Pennsylvania LLC name

One of the most important details when forming an LLC in Pennsylvania is to choose your business name. It’s an important step because the new business registration documents will require you to provide your company’s legal name. You’ll need to think of a business name in compliance with the 2022 Pennsylvania Consolidated & Unconsolidated Statutes. Once you’ve chosen your name, you’ll need to conduct a Pennsylvania LLC name search.

2. Choose a Pennsylvania LLC registered agent

When you’re ready to register a Pennsylvania LLC, you will be required to follow several state business laws. One of these mandatory laws is to hire and continuously maintain a Pennsylvania LLC registered agent pursuant to 15 PA Cons Stat § 8825 (2016). The primary role of a registered agent in the state is to provide service of process.

3. File a Certificate of Organization with the PA Department of State

When you decide to form an LLC in Pennsylvania it will involve filing specific registration documents that will depend on whether or not it’s a domestic or foreign entity. If you choose to form a domestic limited liability company then you’ll need to file a Certificate of Organization pursuant to 15 PA Cons Stat § 8821 (2022). You can form a Pennsylvania LLC online, submit the form through the mail, or physically submit it to the office of the Pennsylvania Department of State, Bureau of Corporations and Charitable Organizations. The fee is $125 and you’ll also need to submit a copy of the Consent to Appropriation of Name with any necessary governmental approvals.

Form a Pennsylvania LLC Today!

4. Prepare the Pennsylvania LLC Operating Agreement

To form a Pennsylvania LLC, you’ll need to prepare internal documents (shared internally) and documents for submission to the state. One such internal document that every limited liability company requires is the LLC operating agreement. The purpose of this agreement is to protect the limited liability clause and to ensure that you’re in control of the company. If you don’t create a Pennsylvania LLC operating agreement then the state laws, also known as the default rules will govern the operations of the limited liability company.

• Statement of intent
• Business purpose
• Time/period of operation
• Member capital contributions
• How it will be taxed
• New member admissions
• Sharing of profits

5. Obtain Pennsylvania LLC EIN

An Employer Identification Number (EIN) is a unique nine-digit number that is assigned to a limited liability company by the Internal Revenue Service (IRS). It’s also known as the Federal Employer Identification Number (FEIN), and it may not be required by single-member LLCs without any employees. Once you register a Pennsylvania LLC, you’ll need to file different business or state taxes and the EIN will be required to complete the process.

Do you want to obtain an EIN in Pennsylvania?

6. Obtain the necessary business licenses and permits

After you’ve taken the steps to form a Pennsylvania LLC online, the next most important obligation to focus on is making sure you acquire the right business licenses. Many American states offer general licenses but Pennsylvania does not. Permits and licenses can vary depending on particular factors like the primary activity and the location of the business. Obtaining the necessary business licenses is a vital step in your business formation because you will not be able to operate your LLC without valid licenses and permits. The business licenses are categorized under:

• According to Industry – Industry-based licenses are issued to businesses or activities that can be classified under a specific industry or trade. These licenses are issued by different government agencies or bodies based on the industry or activity. If you were to form a Pennsylvania LLC focusing on agriculture then it would be classified within the agriculture industry. The business license for this type of entity would be issued by the Pennsylvania Department of Agriculture.
• According to City/County – The second class of business licenses that your company may need to obtain are the local licenses also known as city or county licenses. The types of licenses, fees, and renewals will depend on the location of the business. Let’s look at an example to understand this.

  Example: If you start an LLC in Pennsylvania and the company is based in Philadelphia then you will need licenses or permits issued by the city. Every business in this city is required to obtain a Commercial Activity License. Apart from this, if you are specializing in the entertainment business then you will need to apply for a separate permit or license for the same. These permits or licenses will be issued by the Philadelphia Department of Licenses and Inspections (L&I).

• Professional license – Lastly, certain businesses in Pennsylvania may also require Professional licenses. These licenses are issued by the Bureau of Professional and Occupational Affairs, which includes 29 licensing boards as well as commissions.

7. Open a bank account for PA LLC

Finance is one of the most important aspects of running any business successfully. In order to manage finances properly and segregate personal gains and expenses from business gains and expenses, it’s recommended to open a separate bank account. This is known as a business bank account and you can open it before or after you register a Pennsylvania LLC. The key benefits of a business banking account are that it will help automate bookkeeping and establish a good credit history for the limited liability company. This will eventually make your LLC tax preparation easier.

8. Comply with taxes and other regulations

Once you start an LLC in Pennsylvania, you’ll be required to comply with annual state maintenance requirements. One of the important annual requirements is the Pennsylvania annual report. Pennsylvania is one of the few states that requires you to submit a Decennial Report although this will be replaced by an annual report from 2025 onwards. A Decennial Report has to be filed once every 10 years.

Learn more about starting an LLC in Pennsylvania!

A Pennsylvania LLC registered agent can help you with the process of forming a limited liability company in the state, but you may still have several queries regarding this type of entity. Hence, we’ve created a special section of “Frequently Asked Questions” to address some of these queries.

Is Pennsylvania a good state to form an LLC?

The state of Pennsylvania is home to several top companies like Comcast, PNC Financial Services, Rite Aid, Aramark, and AmerisourceBergen among others. This state provides new and existing LLCs with several benefits and advantages. Some of the reasons for why entrepreneurs prefer to form a Pennsylvania LLC include:

• The state has a low personal income tax rate of 3.07%.
• It is the sixth-largest economy in the nation with a real GDP of $726.04 billion.
• The state is home to a strong workforce of 6.3 million highly skilled individuals.
• It’s proximity to major cities like New York City, Boston, and D.C.
• The state provides access to a strong transportation and logistics infrastructure.
• Pennsylvania has port access to the Great Lakes (Erie), the Gulf of Mexico (Pittsburgh), and the Atlantic Ocean (Philadelphia).
• It’s one of the top U.S. states for graduates who specialize in the STEM (science, technology, engineering, and mathematics) industry.
• The state offers several business incentive programs including the Small Business Advantage Grant, the Enterprise Zone Tax Credit (NAP/EZP), and the Business Opportunities Fund (BOF).

How do I know if my Pennsylvania LLC name is available?

Once you’ve identified or chosen a business name in compliance with the state naming guidelines, you’ll need to conduct a Pennsylvania LLC name search. The name availability search combs the database of the Bureau of Corporations and Charitable Organizations. If the desired name is available then you’ll be allowed to reserve the same.

How much does an LLC cost in Pennsylvania?

When you decide to start a limited liability company in Pennsylvania, you’ll be required to submit a Certificate of Organization for a domestic entity. The initial cost to register a Pennsylvania LLC is $125. The additional fee to expedite the process depends on the expedited service selected. For example, the fee for a same-day service is $100 while the fee for a one-hour service is $1,000. In addition to the initial cost to form a Pennsylvania LLC online, the name reservation, the annual statement, and the application for business licenses and permits will also include fees.

Do I need a business license for my Pennsylvania LLC?

Yes. A business license is required for your LLC to be considered legally operational. You may incur fees or penalties if you conduct business without the proper licenses or permits.

Can I set up a single-member LLC in Pennsylvania?

Yes. You can set up a single-member LLC (SMLLC) in Pennsylvania and most documentation will remain the same. You’ll need to reserve a business name after conducting a Pennsylvania LLC name search. This step will ensure that the chosen name is distinguishable on the records of the Department of State (DOS). You will then be required to file a Certificate of Organization, and apply for the appropriate licenses.

What taxes does an LLC pay in Pennsylvania?

You’ll want to keep in mind that when you start an LLC in Pennsylvania, you’ll be required to file personal income taxes because this type of structure is known as a pass-through entity. Depending on the business activity, you may be required to file other taxes applicable in the state, such as a sales tax for example.

Can I register a foreign LLC in Pennsylvania?

Yes. You can register and operate a foreign LLC in the state of Pennsylvania. The registration of a foreign LLC is governed by the 2022 Pennsylvania Consolidated & Unconsolidated Statutes, Title 15 – Corporations and Unincorporated Associations, Chapter 4 – Foreign Associations. You’ll have to file a Foreign Registration Statement along with a fee of $250.

How do I dissolve my Pennsylvania LLC?

Once you start an LLC in Pennsylvania, you may have reasons for dissolving the said company. According to state laws, 15 PA Cons Stat § 8872 (2022), you’ll be required to file a Certificate of Dissolution along with a non-refundable fee of $70. It needs to be submitted to the Pennsylvania Department of State, Bureau of Corporations and Charitable Organizations.

Ready to form a Pennsylvania LLC?

A Limited Liability Company is considered to be one of the most popular structures in the nation due to the many advantages it has over other structures. You can form a single-member or a multi-member LLC as well as a domestic or foreign entity in the state. IncParadise can help you form an LLC in Pennsylvania and assist you through the entire registration process for this state.

Entrepreneur’s guide to forming a business in Pennsylvania

Choosing a location for your business is a major focal point for first-time business owners and entrepreneurs. Because Pennsylvania is an economically diverse state, it offers just the right infrastructure, top industries, and small business incentives and grants. If you want to register a corporation or start a small business in Pennsylvania, you will find that the availability of an educated workforce becomes advantageous for all forms of new entities.

Why do companies prefer to incorporate and register in Pennsylvania?

Many factors have driven entrepreneurs to register a business in Pennsylvania including its thriving economy with a Real Gross Domestic Product (GDP) of $726.04 billion. Today, the state is home to over one million small businesses in a variety of industries including advanced manufacturing, life sciences, medical technology, logistics, food processing, and manufacturing among others. This is mostly due to the many advantages and benefits that the state has to offer. Some of the top benefits of doing business in Pennsylvania are:

• Tax Incentives – Taxes play a decisive role when it comes to forming a new business in any state. When you decide to start a business in Pennsylvania, you can leverage the various business tax incentive programs offered by the state. These tax credit programs can help offset your overall tax liability.
• Competitive labor market – Skilled employees are crucial to the overall success of any business, and the state has a competitive labor market for skilled talent. The state is home to a rapidly growing tech community. There are also several top educational institutions and it’s supported by state-sponsored workforce training programs.

Wondering how to start a business in Pennsylvania?

Steps to start a business in Pennsylvania

If you’re planning to register a business in Pennsylvania, there are several details to consider and different processes to follow. Figuring out how to establish and maintain a new business can seem difficult when you’re just starting out. Each facet of your business like finances and licensing will have an impact on certain other components in your company. The Starting a business in Pennsylvania checklist will help strengthen your core business objectives.

1. Prepare a Pennsylvania Business Plan

The initial stages are a crucial period for setting your new company on the right course. If a business is a boat, then a business plan is like the sails that will help it move in the right direction. This is also known as a strategic plan. It not only helps entrepreneurs start a small business in Pennsylvania, but it also focuses on the necessary steps for achieving short-term and long-term objectives. This is one of many important points in the starting a business in Pennsylvania checklist. Some of the most important components of a good business plan include:

• Executive summary
• Business Overview
• Organization, ownership, & management
• Industry & market analysis
• Products and services
• Competitive analysis
• Branding and marketing
• Logistics and operations
• Financial statements and projection

2. Attend Entrepreneurial Training or Development Programs in Pennsylvania

Once you’ve decided to register a business in Pennsylvania, you should focus on entrepreneurial training or development programs. Such business development or entrepreneurial training programs are essential to helping the business achieve steady growth and future success. When doing business in Pennsylvania, you will need knowledge, valuable resources, connections, PA training, and development programs for small business owners. Some of the top programs include the Business Workshops & One-on-One Counseling programs by the Pennsylvania SBDC and Partnerships for Regional Economic Performance (PREP) program by DCED, PA.

3. Choose a Business Structure for your Pennsylvania Business

Choosing the right entity structure for your new business is one of the most important decisions you will need to make before you register your company with the state. The entity structure you select will play a key role in your tax and legal considerations. For this reason, you need to determine which type of entity will be the most suitable for your business. The structure you decide on will also determine the process and fee to register a business in Pennsylvania. It is important to note that each type of entity structure has its own characteristics, advantages, and even disadvantages. The type of business structures you can choose for doing business in Pennsylvania are:

• Sole Proprietorship
• Domestic and foreign LLC
• Domestic and foreign corporations
• General partnership
• Limited partnership
• Limited liability partnership (LLP)
• Limited liability limited partnership (LLLP)
• Nonprofit corporations
• Professional associations

4. Naming Your Pennsylvania Business

An important requirement to register or incorporate in Pennsylvania is confirming a business name. The company name is responsible for creating the very first impression with the client or customer of the said company. The name is not only used for the registration process but also for other business processes like licensing, applying for loans, filing taxes, and marketing. Hence, when choosing a name, you need to consider several aspects like:

• It is important to follow the state naming requirements and guidelines. These are governed by the 2022 Pennsylvania Consolidated & Unconsolidated Statutes, Title 54 – Names.
• The business name should be distinguishable from any other company in Pennsylvania. You need to also adhere to not using restricted words like the word bank. You cannot use words that have similarities with government agencies.
• Once you have chosen a name, it is time to conduct a Business Entity Search also known as name availability search.
• Pennsylvania requires you to reserve a business name by filing the name reservation form pursuant to 15 PA Cons Stat § 202 (2022).
• If you don’t want to use your legal name then you will need to register a fictitious name. This name also known as DBA (Doing Business As) will be registered pursuant to 54 PA Cons Stat § 311 (2022).
• You will have to officially publish a notice post filing an application for registration of the fictitious name.

5. Choose Your Location for Pennsylvania Business

If you’ve made the decision to start a business in Pennsylvania then the location of your company is an important focus area. The location of your company influences several aspects related to your business like operations, scalability, profitability, competition, risk, and expenses among others. There are some key factors that a company needs to consider when choosing a location and they are:

• Accessibility – One of the foremost factors is accessibility. If your business activity relies on clients, vendors, transportation and logistics then an accessible office will ensure doing business in Pennsylvania is easy. This means that your chosen location should be accessible to clients or customers. If you are in the manufacturing industry then your office should be close to transportation hubs, opportunity zones, and foreign trade zones.
• Competitors – Competition is necessary but too much competition can kill a business. Being closer to your competition can be a good strategy but may also hurt your business. Healthy competition can fuel innovation and you can even leverage their marketing strategies for your company’s profit.
• Operating and related costs – When you start a small business in Pennsylvania, one of the areas that will impact the company’s ability to run smoothly is operational costs. This cost will vary from one company to another depending on the primary business activity. Some of the elements that influence the operational cost include the coast of inventory, electricity and water, transportation and logistics, rent of commercial space, marketing, employee salary, and other miscellaneous expenses.
• Local zoning ordinances – Last but not least; it’s always important to check local zoning ordinances. These rules and regulations vary according to the city or county that your business is located in e.g., the local ordinance of Philadelphia County will be different from that of Allegheny County or Pittsburgh city. Local zoning ordinances also define the need for local Pennsylvania business licenses and permits for specific business activities.

• Philadelphia
• Pittsburgh
• Erie
• Allentown
• Reading
• Lancaster
• Scranton
• York

6. Register Your Business with the Pennsylvania Department of State

Whether you want to incorporate in Pennsylvania or start a home-based company, most kinds of businesses will need to undergo the process of a new business registration with the state. You will be required to fill out and submit documentation in accordance to the type of entity structure chosen. The documents have to be filed with the Pennsylvania Department of State, Bureau of Corporations and Charitable Organizations. Let’s look at an example to understand this.

Do you want to form a new business in Pennsylvania?

7. Get Your EIN

An Employer Identification Number (EIN) is an important point on the starting a business in Pennsylvania checklist. It is mandatory for certain business structures and optional for others like a sole proprietorship without employees. In general, an EIN will provide your business with certain advantages. It is mostly used for filing your taxes but can be required for opening a business bank account or for taking out a loan. One of the most important benefits of having an EIN is that it will boost the overall credibility of your company. The Employer Identification Number is issued by the Internal Revenue Service (IRS).

8. Open a Business Bank Account for Pennsylvania Business

Whether you’re just starting as a sole proprietor or want to register a business in Pennsylvania as a corporation, one of the important business requirements is opening a bank account. You may think that your personal savings account would suffice, but realistically, it will make accounting difficult and lead to confusion when filing your tax return. Some of the reasons a company may require a separate account also known as a business bank account are:

• It is a legal requirement for certain types of businesses like corporations
• It will help in separating your personal income and expenses from that of the company
• The checking account will make expense tracking easier and help streamline the financial records as well as the tax information of the company.
• It will help provide clear records for audits
• A business banking account will help establish business credit by maintaining good financial habits

9. Obtain the Necessary Pennsylvania Business Licenses and Permits

If you’ve decided to start a small business in Pennsylvania, it would benefit you to know that one of the most important requirements in the state is obtaining the proper business licenses. Unlike many other states, Pennsylvania does not have a state license or general business license, although local licensing is required. The Pennsylvania business license requirements will vary according to different factors like the primary business activity and location of the company. Business licensing can be divided into three categories that include:

• Business licenses by Industry – If your business activity falls under a specific industry then the type of license needed will be determined by that industry. These licenses will be issued by different government agencies or bodies. If you decide to start a small business in Pennsylvania as a restaurant then you will need to apply for the Retail Food Facility Licenses issued by the Pennsylvania Department of Agriculture.
• County or City Licenses – You may need to apply for and obtain a Pennsylvania business license in the city or county where your company is located. Different counties or cities have different licensing rules, regulations, fees etc., and the type of license or permit will depend on business activity. In the city of Pittsburgh, the Department of Permits, Licenses, and Inspections issues local licenses for different types of activities like bed and breakfast and stationary Vendors.

10. Get Business Insurances

All forms of businesses typically require some type of business insurance, as it helps them to cover any costs associated with liability claims and property damage. If you start a business in Pennsylvania and have not invested in proper business insurance then as an owner, you may be at a risk of having to pay out costly damages or even for legal claims against the company. Every new or established company at some point in time faces some form of risk. Good business insurance can protect owners and the business. If you incorporate in Pennsylvania then the most common forms of business insurance that you can choose from are:

• General liability insurance
• Product liability insurance
• Professional liability insurance
• Employment practices liability insurance
• Business interruption insurance
• Workers’ compensation insurance
• Business Owner’s Policy (BOP)
• Home-based business insurance

11. Annual and Ongoing Requirements

Once you register a business in Pennsylvania, you will need to ensure complete compliance with state annual requirements. Different states in the USA have different annual requirements and fulfilling them will guarantee that your status will remain in good standing in the state. When you incorporate in Pennsylvania, one of the requirements is to file your annual report. Pennsylvania requires you to file a Decennial Report (once every ten years). The submission period of 10 years is expected to change to a one year period from 2024. The filing fee for the annual report depends on the type of business structure.

Some Important Quick Resources for Pennsylvania Businesses

When you are creating a business plan, you will need all possible resources and information concerning the operations of the new company. The information will not only help you to register and start a business in Pennsylvania but it will also provide information concerning others like the Pennsylvania business license, taxes, annual reports, small business development programs, and state business incentives among others. Let’s look at some of the important resources.

Pennsylvania Secretary of State

The office of the Pennsylvania Secretary of State has a website where you will find different types of information related to general and specific business requirements like forms, fees, business record searches, online licensing services, and much more. It is also known as the Pennsylvania Department of State.

• Pennsylvania Department of State
  302 North Office Building,
  401 North Street
  Harrisburg, PA 17120
  Phone – (717) 787-1057
  Email: RA-CORPS@pa.gov
  Website – https://www.dos.pa.gov/Pages/default.aspx

Pennsylvania Department of Revenue

This is an important department if you plan on doing business in Pennsylvania. You’ll get information and resources related to Personal Income Taxes and state business taxes. They provide information related to tax rates and the types of taxes applicable to your company. They also have a dedicated customer service team.

• Pennsylvania Department of Revenue
  11th Floor, Strawberry Square,
  Harrisburg, PA 17128-0431
  Phone – 717-787-1064
  Website – https://www.revenue.pa.gov/Pages/default.aspx

Pennsylvania Department of Labor & Industry

After you register a business in Pennsylvania, you may need to hire employees or a skilled workforce. This is where the Pennsylvania Department of Labor and Industry comes into the picture as it provides information and resources related to the various facets of employment. You will get information on workers’ compensation services, occupational and industrial safety standards, labor law, workforce protection, career training & development resources, and grants among others.

• Pennsylvania Department of Labor & Industry
  1700 Labor & Industry Building
  Harrisburg, PA 17120
  Phone – 717-787-5279
  Website – https://www.dli.pa.gov/Pages/default.aspx

Small Business Administration (SBA) Pennsylvania

The U.S.Small Business Administration is an independent agency created to provide the necessary support for small businesses and entrepreneurs. They provide valuable resources related to starting a business, Pennsylvania business license, funding opportunities in the state, grants programs, loan assistance, business development, entrepreneurship education, and credit risk management among others. They have several branch offices in Pennsylvania with the largest being in the Philadelphia District.

• SBA Pennsylvania
  2601 N. Third St.
  Suite 503
  Harrisburg, PA 17110
  Phone – 717-782-3840
  Website – https://www.sba.gov/district/philadelphia

Pennsylvania Business One-Stop Shop

The primary objective of a Pennsylvania Business One-Stop Shop is to help you start a business in Pennsylvania. They provide a team of business experts from various industries in PA who can provide you with the tools, resources, and experience that will assist you with future planning. They have a small blog targeted at small businesses and also provide information on small business funding. They provide information on various entrepreneurship and business events like the 9-Week Financial Boot Camp starting in June 2023. You can also find various business forms in their library section.

• Pennsylvania Business One-Stop Shop
  410 Northeast St
  Williamstown, PA 17098
  Phone – 1.833.722.6778
  Website – https://business.pa.gov/

Partnerships for Regional Economic Performance

The Partnerships for Regional Economic Performance (PREP) is a program that has been designed by the PA Department of Community & Economic Development (DCED). This partnership involves a network of partners throughout the state who work in sync to deliver vital business assistance. The local and regional partners can assist entrepreneurs with all aspects of business development and growth, and help them to create a starting a business in Pennsylvania checklist around these aspects. Some of the areas of focus for PREP include: specialized workshops, financial incentives, one-on-one counseling, and expansion into new markets among others

• Partnerships for Regional Economic Performance
  Harrisburg Regional Chamber & CREDC
  3211 North Front Street, Suite 201
  Harrisburg, PA 17110
  Phone – 717.213.5042
  Email – melissa@hbgrc.org
  Website – https://dced.pa.gov/programs/prep/

Pennsylvania Small Business Development Center

The primary objective of the Pennsylvania Small Business Development Centers (SBDC) is to help entrepreneurs start a small business in Pennsylvania, achieve growth, and prosper. They provide no-cost confidential consulting services and a variety of educational programs to first-time business owners. There are 15 centers in the state that provide assistance with various business issues like creating a business plan, marketing analysis, commercialization of technology, investigating funding opportunities, competitive research, and SBIR/STTR Proposal Preparation Assistance among others.

• Pennsylvania Small Business Development Center
  155 Technology Center
  200 Innovation Boulevard
  University Park, PA 16802
  Phone – (814) 863-4293
  Website – https://www.pasbdc.org/

PA Chamber of Business and Industry

The Pennsylvania Chamber of Business and Industry is a type of business advocacy association whose objective is to assist businesses of all different types and sizes in all industry sectors. They also advocate key policies that affect industries and businesses and provide resources and information on human resources, OSHA, workplace safety, information technology, and employee benefits among others.

• PA Chamber of Business and Industry
  417 Walnut Street
  Harrisburg, PA 17101, US
  Phone – 717.255.3252
  Website – https://www.pachamber.org/

Ready to start a business in Pennsylvania?

Pennsylvania’s proximity to major ports on the East Coast gives businesses and entrepreneurs the strategic advantage they need to successfully operate. When you register a business in Pennsylvania, you will be able to leverage different state programs including financial incentives and grants. Although the startup registration process may seem a little complex, a reputable Pennsylvania registered agent like IncParadise can provide valuable assistance with business formation or incorporation.