Business in the USA

How to start a business in the US?

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You have heard that to open a business in the US is it very simple? But do not know how to do it yet? You have already decided that you want to open a company in America, but do not know where to start? Let’s try to figure it out.

How to start a business in the USA:

1. Continue the business in which you were engaged in your country.

If a person opens a branch of his organization in the states, he becomes eligible for an L1 visa. Thanks to this visa, you can move to America and grow your business. If your company works well and regularly pay taxes, then in two years you can apply for a green card.

2. Make an investment in the US economy.

If you have a lot of money (from $ 100 thousand or more), you can invest money and get an E2, EB5 investor visa. You can buy an existing business or arrange a franchise.

3. Open a new company.

If you are a resident and have a social security number, you can open your business in the states. A foreigner to open a new enterprise will need to involve the US resident in cooperation with SSN.

In the United States, there are four basic organizational and legal forms of enterprises:

1. Sole Proprietor ship. Individual entrepreneurship.

This is one of the most common options. You will only need to register the name and get a license. No more formalities. Any person who engages in commercial activities is automatically an entrepreneur. If you are freelancing, you are also an entrepreneur and must pay taxes. Tax evasion is considered a very serious crime.

In this case, it is not business that is taxed, but you. At the end of the year, when submitting a declaration, the individual entrepreneur submits the form 1040, indicates the income from the business as his personal income and pays the employment tax. In this case, the taxation of salaries (for oneself and employees) is taken into account separately.

If you plan to hire people, then you need to get an INN (tax number) in the Tax Service. With this number you need to go to the bank and open a business account.

Pros: minimum effort for opening a business, minimum costs for the first couple, simple tax reporting, full control.

Cons: the owner’s full responsibility, if you have debts, personal property will be at risk.

2. Partner ship. Partnership.

If you plan to create a new business, not one, but with someone, then this legal form is for you. Partnerships involve making all decisions together. Make a partnership agreement in advance. To create a Partnership, you must register a business in the state where you live and register a name. All this can be done with the state secretary. Further, the Partnership must be registered with the Internal Revenue Service (IRS) and receive a taxpayer identification number there. You do not have to pay income tax, all income and expenses are transferred to the founders and this data is displayed in their tax returns.

Pros: simplicity of design, together you can quickly achieve your goals than alone.

3. Corporation. Corporation.

This is the most complex form. Usually this is a huge organization with a lot of staff. In this case, the corporation, and not its shareholders, is responsible for debts that may arise.

Pros: you can raise additional finances by issuing shares.

Cons: large administrative expenses, complex tax schemes , many legal requirements, complex in organization and management form.

4. Limited Liability Company. Ltd.

A huge advantage of an LLC over an individual enterprise is that its owner or owners are not personally liable for the debts and obligations of the company.

Just like in the case of individual entrepreneurship, All funds that come to the company’s account are subject to employment tax. Those. all income received by the company with the deduction of expenses will be the personal profit of the owners and subject to income tax. Registration will require the creation of incorporation documents and the application for registration with the state secretary. LLC is convenient to open when you plan to develop several activities at the same time. It is also worth opening LLCs if you plan to attract investors.

Pros: registration is a bit more complicated than individual entrepreneurship, but still quite simple; less founder costs; limited liability like a corporation; tax efficiency.

Cons: if the founder of the LLC dies or cannot pay its debts, the organization will be liquidated.

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