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I want to start a small business, what are my first steps? Your first step should be to make an appointment with an SBDC Counselor/Advisor. Our services are free and confidential. To find the advisor in your area, click here. Prior to your first visit, review the "Checklist for Starting a Business" on the SBA site. It is also helpful for the business advisor if you try putting some of your ideas down in writing for them to review. I have heard that grant money is available, how can I find out more about it? There are several web sites where you can search for grants. Grant money is rarely available for profit ventures as a source of capital. Go to the SBA web site to check out various types of grant potential out there by clicking here. How do I register my business name with the Secretary of State? If you are going to do business as a limited partnership or a limited liability company under a name other than your own, you need to register your trade name with the Secretary of State. Once the name has been approved you then must register the name with your local Town Clerk. To register online with the Secretary of State go to: http://www.sots.ct.gov/onnlineapps.htm or call 860-509-6002. If your business is a sole proprietorship (owned and operated by an individual) or a general partnership, you do not need to register your business entity with the state. *NOTE: There may be state, city, or town permits or licenses that are required to operate your business. Also, your name should be registered with your local Town Clerk. What type of business should I choose? There are four primary legal forms of business from which to choose from.
How do I finance the start - up of a small business? To determine your finance needs you should first prepare a business plan with financial projections. These projections should include a balance sheet, income statement, and cash flow statement. The proper business plan will help you identify your funding needs. Most small business start-ups are funded through personal resources which include savings, equity or loans from friends and family, home equity loans, cash value of life insurance, and any other personal resources. Banks will lend to some business start-ups if they comply with your business plan, your level of equity investment, the collateral you have to pledge to the loan, and your credit history. If the bank denies your request, ask the lender if they would consider a loan with a guarantee from the Small Business Administration (SBA). In addition, there are a number of local and regional economic development agencies that offer revolving loan funds. If you need help writing a business plan and assistance in finding the type of financing you need, please contact your local SBDC office and make an appointment. Do I need to obtain a Federal Identification Number? An EIN, Form SS-4, also known as a federal tax identification number, is used to identify a business entity. Generally all businesses need an EIN. You can also call 1-(800)-829-4933 to get an EIN. Taxpayers can fax EIN requests by dialing the fax number to one of three IRS campus' that accept applications. You can find this information online at: www.irs.gov/smallbiz, click on New Businesses. How do I obtain Business Insurance? Business Insurance protects the contents of your business against fire, theft and other losses. Contact an insurance agent or broker of your choice. Common types of insurance are Liability Insurance, Property, Business Interruption, Key Man, Automobile, Officer and Director and Home Office. How do I know what licenses or permits I need for my business? Several types of businesses and professions require state licensing. The Connecticut Licensing Information Center (CT-CLIC) is CT's gateway for business registry. The web site provides over 900 licenses, permits and registrations among 29 licensing agencies. It also provides contacts and links for downloadable forms. Smart Start is on the CT-CLIC website and provides simplification for businesses to become fully qualified with Connecticut laws. Free personalized assistance is available through Smart Start to assist businesses through the registration process. Visit CT-CLIC on the web at: www.ct-clic.com or contact Smart Start at (800) 392-2122 or e-mail: SmartStart@cerc.com. If I am self employed, how do I report my taxes? Self-employed business owners are required to pay state and federal income taxes, Social Security, and Medicare based on the profits from the business. Profits in a proprietorship are determined before you draw compensation from the business. Once your liability for federal income tax and self-employment FICA exceeds $500, you will need to deposit the tax payments to the IRS. You can estimate and report your federal taxes by using the 1040-ES Form, and your state taxes by using the Form CT-1040ES. You can also derive an estimate of your tax liability from your most recently completed Schedule C (profit and loss statement for a proprietorship) or by completing a monthly profit and loss statement. Be aware that if you don't deposit the appropriate taxes for any individual quarter, or for the year, the IRS can and will impose stringent penalties and interest.. If you need these forms, contact your local IRS office or Business Answers for their Estimated Income Taxes and Self- Employment package. How do I know what taxes are required by the State for my businesses? The Connecticut Department of Revenue Services is the agency responsible for tax laws and collecting state tax revenues. Sample Taxes collected are Sales and Use Tax, Corporate and Personal Income Tax, Business Entity Tax, Admission Tax, Dues Tax, etc. They provide useful information on their website at: www.ct.gov/drs. Their phone number is (800) 382-9463. Employers are also required to register with the Connecticut Department of Labor (DOL) for payment of unemployment and workers compensation taxes. The DOL website is: www.ct.gov/dol and phone number is: (860) 263-6000. How do I know what taxes are required by the Government for my businesses? Like state income tax, the method of paying federal income tax depends on your legal form of business.
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