Establishing a New Business   I often get asked, "What needs to be done to establish a new business?"  Here's my list of the first few steps. (1)     Determine what type of entity you should be: corporation, LLC, partnership or sole proprietor.  This decision affects your liability protection as well as your taxation.  It's important.  I recommend you discuss this with an accountant and perhaps an attorney. For more information, see our overview of business taxes. (2)     Establish the entity.  So, for instance, if you have decided to be an LLC or a corporation, file the paperwork with the state.  All the forms and instructions you need are available at MD Deptarment of Assessments and Taxation.   (You can also pay a copmany to do this for you, or have your attorney do it.) (3)     Get an Employer ID Number (also called and EIN) for the entity by completing Form SS-4 or applying online.  Get an EIN  (Note - you do not need an EIN if you are a sole proprietor and you will not have any employees.) (4)     If you are a corporation or an LLC and you have decided to be taxed as an S Corporation, fill out and submit Form 2553.  This is due 75 days after you establish the entity.  Filing it late might mean that you will have to be taxed as some other type of entity.   If you are an LLC and you have decided to be taxed as a corporation, fill out Form 8832. (5)     Open a bank account. (6)     Get a license.  Depending on your business, you may need a license.  I suggest you start at the state level and work your way down to find out exactly what you need.  You can apply online for state licenses at Maryland Business Licenses Online, or go to the court house at 7 Church Circle in Annapolis, 8:30 - 3:30 M-F.  For help by phone call 410-222-1397 and ask for licensing.  (7)     If you are going to have employees, there are a number of things that need to be done.  I recommend that you let a payroll service do your payroll because payroll tax penalties are extremely harsh.   So, just call us and we'll get you set up.