Starting a business in Florida could be your path to financial independence or just an interesting way to liven up your career. Either way, before you can start making sales and generating income, you’ll need to complete a few important steps to register your business. Florida also has a number of pro-business state tax policies and has a low cost of living, which makes it an ideal place to build wealth for your future. The state is home to a diversity of different demographics, so you could hypothetically profit from many types of businesses and similar to the state of Colorado, there are many large, startup-friendly cities such as Orlando, Miami, Jacksonville and Tampa.
Steps to Forming a Business in Florida and Getting a Tax ID (EIN) Number
- Form a Business in Florida
- Federal Tax ID (EIN) Number Obtainment
- Florida State Tax ID Number
- Localized Licenses and Permits in Florida
Your first step to starting a business in Florida should be to decide which business type will best suit your company. There are several factors you should consider when evaluating what type of business to create. For example, corporations have the unique advantage of being able to issue public shares for fundraising, making them ideal for businesses that intend to eventually expand. However, they also tend to be more complex than other business types, both to start and to maintain over time. LLCs are a bit easier, but if you’re looking for convenience, sole proprietorships and partnerships tend to be the easiest.
You can also consider the tax advantages of each business type. In a sole proprietorship or a partnership, you’ll be responsible for paying taxes as an individual on the money you make through the business. LLCs are considered pass-through entities; you won’t owe taxes on income generated by the LLC, but you’ll need to pay taxes as an individual on any money you withdraw as salary or profit from the business. You’re also required to file an annual report for your LLC. Corporations will be required to pay income taxes on all income, resulting in double taxation when filing your individual taxes. The Florida corporate tax rate for income made in the state is 5.5 percent.
You’ll also want to consider your exposure to liability. In a sole proprietorship or partnership, you won’t have any liability protection. You’ll be responsible for taking on all debts personally, and you may be held personally liable for decisions you make on behalf of the business. LLCs and corporations are treated as separate legal entities, however; they can take on debts of their own, and could be held liable for business-related liability issues instead of you, personally. This makes them a more popular choice for most types of businesses.
The majority of Florida businesses will need to get a federal tax ID number, which you’ll receive when you register your business with the federal government. Note that this number is sometimes referred to as an employer identification number or EIN. This nine-digit number will uniquely identify your business, and is used for a wide variety of applications. You’ll need one for any business that has multiple members, as well as any business that’s going to hire employees. You’ll need an EIN to open a business bank account, to apply for business credit or a loan, or to fill out license and permit applications.
If you want to start your business as quickly and easily as possible, make use of our federal tax ID number obtainment services. Answer a few simple questions about your business using our online application, and we’ll send you your federal tax ID in less than an hour.
Your business may also need a Florida state tax ID number. As the name suggests, this is a separate, unique ID number that applies at the state level rather than the federal level. You’ll need this if you’re going to hire employees in the state of Florida, if you’re going to sell taxable goods and services in Florida, or if you’re going to owe excise taxes, which apply to regulated products like alcohol and tobacco.
To get a Florida state tax ID number, your first step should be getting a federal tax ID number. Once you have that number in hand, you can begin the online application by using our Florida state tax ID number obtainment services. All you’ll need to do is answer a few questions about your business; after you do, you’ll receive your state tax ID in 4 to 6 weeks.
Many businesses in the state of Florida will need a license, permit, or some other form of formal certification to operate legally. That said, there is no catch-all “business license” that covers all Florida businesses. Instead, license and permit requirements vary wildly based on the nature of your business, your industry, and your location. Most licenses and permits in the state are regulated and issued at the local level, either with your city or county. You’ll need to speak with your local Chamber of Commerce to get the specific details as they apply to your business.
Florida is home to many small businesses and entrepreneurs hoping to make an impact on the economy. There are currently 2.5 million small businesses in Florida, representing 99.8 percent of all Florida businesses. Together, they’ve hired 3.3 million employees in the state, who cumulatively represent 42.2 percent of Florida’s working population. Florida’s economic growth rate is comparable to the national average, and unemployment is currently a mere 3.9 percent, down from 4.6 percent at the beginning of January. The sooner you get your federal tax ID number and Florida state tax ID number, the sooner you can start your business. Take advantage of our federal tax ID number and Florida state tax ID number obtainment services today, and get your tax ID numbers as quickly as possible.