How to Legally Name and Form a Small Business in 6 Simple Steps

form a small business

My journey into small business ownership was semi-accidental. When I left my last company after it was acquired, I simply wanted to make enough side coin to keep me in the black during my sabbatical.

Eventually, the accidental business became, like, a thing. I hit my three-year anniversary as an independent consultant in March.

Because business ownership wasn’t exactly planned, I skipped some pretty important stuff. I just got a grip on money management this fall and I didn’t even have business cards until January!

Like many first-time entrepreneurs, I didn’t know how to form a small business back then. And, until recently, I still didn’t know what steps to take. I just kinda knocked things out as I thought of them.

Fortunately, the team at Hopscratch got my back. Hopscratch has outlined an approach for starting a business or legitimizing an existing business the right way. Each phase of the creation process – legal, financial, marketing, etc. – includes step-by-step instructions for getting sh*t done.

You can do-it-yourself by signing up to access the resources on their site. Or you can buy their business-in-a-box package and let them do the heavy lifting.

I love their outline. Over the next couple months, we’ll dive into each segment of a business launch. Up first, how to legally name and form a small business.

How to Legally Name and Form a Small Business

A new human (aka, your baby) needs a legal name and birth certificate. A new small business (aka, your other baby) needs those things too.

Once you’ve brainstormed creative business names, weighed the pros and cons of each, and whittled your list to a select few, it’s time to get serious. Here’s how to legally name and form your new small business.

1. Choose a business structure. As a sole proprietor, your personal assets would be at stake if your business ever got sued. Instead, form a corporation for tax savings and legal protection. A popular option for small business is a Limited Liability Company, also known as an LLC.

2. See if your domain name is available. Your domain is the online address for your business. Lean Domain Search is great tool for finding relevant .com domain variations for your potential business name.

3. Search for existing trademarks. Search the U.S. Patent and Trademark Office database to ensure that your name is available. As long as no one in your industry is using your name, you should be OK.

4. Check availability in your state. Each state has its own corporation commission and each commission has its own website and process. Check with them to make sure that your name is available.

5. Purchase your domain name. GoDaddy and HostGator are good domain shopping options. Try for a .com but be open to a .co, .me, etc. If you can’t secure your exact business name, consider adding a short word like my to the front of it.

6. File your articles of incorporation. You’ll file the founding document for your business with your state’s corporation commission. This document includes your company name, address, corporate purpose, and registered agent (you).

Congratulations! You now have a legally named and formed business. You’ll have some usernames and passwords to save and some physical paperwork to file away, but the hard work is done.

Now it’s on to the financial aspects of starting a small business. We’ll cover Employer Identification Numbers, business banking, and accounting software in our next post.

Now that you know how to form a small business, will you get the process started?

About the Author

Matt Simpson

Matt is a freelance writer for The DRIVE blog with expertise in digital marketing, social media, and copywriting. He's active in the #yesphx startup movement and has been recognized by AdWeek, Mashable, and more for digital innovation. Visit Matt's website or follow Matt on Twitter.


  1. says

    You really are kind of wasting money filing articles of incorporation for a sole proprietorship just starting out. If you are worried about being sued, get yourself a good BOP (Business Owners Policy) that includes liability and E&O (Errors & Omissions) coverage. Save the incorporating for if/when you have a physical location or if you plan on taking on large amounts of debt to fund your business. For the average part-time online seller just starting up their business and not yet profitable, filing a DBA or fictitious name with their state taxation department and using a schedule C with their personal 1040 should be fine. Any businessowner, regardless of how small also needs to know the sales & use tax laws of their home state to be sure they’re paying the correct taxes.

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