Company Formation In The US : Everything You Need To Know

What Does It Take To Form A Company In The US?

Forming a company in the United States involves several essential steps that vary depending on your chosen business structure. The most common business types include Sole Proprietorships, Partnerships, Limited Liability Companies (LLCs), and Corporations (C-Corps and S-Corps). Each structure has distinct legal and tax implications.

For most formal business entities, you’ll need to:

1. Choose a unique business name that complies with state regulations

2. File formation documents with the appropriate state agency (typically the Secretary of State)

3. Obtain an Employer Identification Number (EIN) from the IRS

4. Secure necessary business licenses and permits at federal, state, and local levels

5. Create internal governance documents like operating agreements or corporate bylaws

6. Set up proper accounting systems for tax compliance

The complexity and cost of each step vary by business type, size, and location. For example, establishing an LLC typically requires less paperwork than forming a corporation, while sole proprietorships have minimal formal requirements but offer fewer legal protections.

What Is The Best State To Start An LLC If I’m Not A US Citizen?

Non-US citizens can legally form companies in the United States, with LLCs being particularly popular due to their flexibility and liability protection. When selecting a state for registration, several factors deserve consideration:

Delaware remains the premier choice for many international entrepreneurs due to its business-friendly legal system, strong privacy protections, and the Court of Chancery that specializes in business cases. You don’t need to be a resident or even visit Delaware to form an LLC there.

Wyoming offers significant advantages with no state income tax, low filing fees, minimal reporting requirements, and strong privacy protections. It’s increasingly popular among foreign entrepreneurs seeking cost-effective options.

Nevada provides strong privacy protection, no state income tax, and no information-sharing agreement with the IRS, making it attractive for non-citizens concerned about privacy.

Other factors to consider include:

• Whether you’ll physically operate in the state

• State-specific tax considerations

• Annual reporting requirements

• Registered agent availability

• Banking accessibility for non-residents

While Delaware, Wyoming, and Nevada offer distinct advantages, the “best” state depends on your specific business goals, budget, and operational plans. Many non-US citizens find Delaware’s established legal framework provides peace of mind, though Wyoming’s cost advantages make it increasingly competitive.

What Company Formation Companies And Services Are in The US?

Professional company formation services streamline the business establishment process by handling paperwork, compliance requirements, and providing ongoing support. These services are particularly valuable for non-residents unfamiliar with US business regulations.

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Service Provider	Core Services	Key Features	Starting Price
ZenBusiness	LLC Formation, Registered Agent	Automation-focused, good for digital entrepreneurs	$49 + state fees
Incfile	LLC & Corp Formation, Registered Agent	Free LLC formation (state fees apply), included registered agent first year	$0 + state fees
Northwest Registered Agent	All Business Formations, Premium Registered Agent	Privacy-focused, personalized customer support	$225 + state fees
LegalZoom	Comprehensive Business Services	Extensive legal document library, attorney access	$79 + state fees
Harvard Business Services	Delaware Specialization	Delaware formation experts, lifetime registered agent discounts	$179 + state fees

Prices, rates, or cost estimates mentioned in this article are based on the latest available information but may change over time. Independent research is advised before making financial decisions.

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The right formation service depends on your budget, service needs, and complexity of your business structure. Budget-conscious entrepreneurs might prefer Incfile or ZenBusiness, while those needing more comprehensive legal support might opt for LegalZoom or specialized services like Harvard Business Services for Delaware formations.

Most reputable services offer tiered packages that include:

• Business name availability checks

• Document preparation and filing

• Registered agent services

• EIN obtainment assistance

• Operating agreement templates

• Compliance alerts and annual report filing

For non-US citizens, services that specialize in helping international entrepreneurs navigate banking and tax requirements provide particularly valuable support.

Business Licensing Requirements Across The US

Beyond company formation, obtaining the proper business licenses is crucial for legal operation. The United States has a multi-layered licensing system that includes federal, state, county, and municipal requirements.

Federal licenses are required for specific industries regulated by federal agencies, such as alcohol production, aviation, firearms, radio/TV broadcasting, and interstate transportation. Most businesses won’t need federal licenses unless operating in these regulated sectors.

State licenses vary significantly across the 50 states. Professional services (doctors, lawyers, accountants), retail establishments, food services, and construction typically require state-level licenses. Some states have blanket business license requirements, while others regulate specific industries only.

Local licenses and permits are perhaps the most common requirement. These often include:

• General business licenses/permits

• Zoning and land use permits

• Building and construction permits

• Health department permits

• Signage permits

• Fire department permits

For foreign entrepreneurs, navigating this complex licensing landscape can be challenging. Working with a knowledgeable business attorney or formation service that includes license research can prevent costly compliance issues and potential penalties.

Conclusion

Forming a company in the United States offers tremendous opportunities but requires navigating a complex landscape of federal, state, and local regulations. For non-US citizens, states like Delaware, Wyoming, and Nevada provide attractive options with varying advantages regarding privacy, taxation, and ease of formation. Professional formation services can significantly simplify the process by handling documentation, compliance requirements, and providing valuable guidance throughout the business lifecycle. Regardless of which path you choose, understanding the complete requirements—from selecting your business structure to securing proper licenses—will set your US business venture on solid legal footing.