Where and How to Set Up Your Business (Even if You’re Remote)
You don’t need a downtown office or a storefront to have a legitimate, legally recognized business. It’s a new dawn, a new age…and remoteness is a strong desire by employees and entrepreneurs. Whether you work from your laptop, your home office, or a co-working space, setting up your business the right way ensures you’re operating with clarity, confidence, and structure.
Step 1: Choose a State (Usually Your Home Base)
Most remote business owners register in the state they live in. It’s simpler, makes tax filing easier, and keeps your paperwork minimal. The only reason to register in another state (like Delaware or Wyoming) is if your legal or tax advisor says it offers you specific advantages.
Step 2: Decide Your Legal Structure
- Sole Proprietorship: No separation between you and your business. Simple, but no liability protection. If your business gets in trouble, it isn’t far to get to you too.
- LLC: Recommended for most solo service providers. It gives you legal protection and keeps your business separate from your personal assets.
You’ll file your paperwork through your Secretary of State’s office. Fees range from $50 to $300, depending on the state.
Step 3: Get an EIN from the IRS
This is if you have opted for an LLC. You’ll need this to open a business bank account, hire contractors, and file taxes. It’s free and easy to apply for at irs.gov.
Step 4: Business Bank Account
Keeping your finances separate is one of the best habits you can develop. It simplifies bookkeeping and ensures you don’t accidentally mix business and personal spending.
Step 5: Register for State or Local Licenses
Some areas require a local business license, even for remote businesses. Check your city or county website to make sure you’re in compliance. You can also join great organizations like XYPN for financial advisors and they will help guide you.
Setting up your business properly isn’t just red tape, it’s how you lay the foundation for a scalable, trustworthy brand. You get your bases covered and when/if you have issues down the road you will be happy you took the time. When your business is structured correctly, it creates clarity for both you and your clients. And that clarity makes everything else easier.
