The Ultimate Guide to Incorporating a Company in the US

The need to establish a company in America has recently become a subject we hear about frequently. Most people want to own a company in America because they sell on Amazon. The business of those who sell by establishing a company in America is more profitable and sustainable.

Certain details should be considered to open a company in America. It is necessary to decide which company will be the most suitable. At the same time, the cost of establishing a company in America also requires detailed information. In this content, we will cover the details you need to know to establish a company in America. If you are ready, let's start!

The Importance of Establishing a Company in America

America offers various opportunities to those who want to establish a company. In other words, starting a business in America can be an attractive option for various reasons. The United States is known for its vibrant and diverse business environments that offer opportunities to both domestic and foreign entrepreneurs.

Additionally, the US has one of the largest and most dynamic economies in the world. It draws attention with its large consumer market possessing significant purchasing power. Therefore, businesses to be done in America can help you increase your income with its countless opportunities.

Access to various financing options is quite easy in America. Being the hub of innovation and technology, America provides reliability in situations requiring legal protection. Doing business in America is also highly beneficial. Because you can easily find qualified and skilled employees in the US.

Which States Should Be Preferred to Start a Company in America?

The US offers many opportunities to start a business. However, you still need to choose the location where you will establish your company wisely. Physically, your company's location should be situated in places frequently visited by consumers.

States have various possibilities. It is of critical importance to consider these factors when making your decision. Rules and regulations vary from state to state. In addition, entrepreneurs should gather information about competing American companies. In other words, you must know well which companies you will compete with.

There are states that have an impact on the success and sustainability of business operations. So, let's examine the states you can prefer to start your business in the United States.

• Texas

• California

• Florida

• Colorado

• North Carolina

• New York

• Nebraska

• Wyoming

• Montana

• Oklahoma

Benefits of Establishing a Company in America

To stand out in terms of commerce and marketing in America, you need to be competitive. Besides this, America also fuels competition with e-commerce sites. However, establishing a company in America has countless benefits. Here are the advantages of opening a company in America.

• It helps you create a global brand.

• Your income increases with its favorable economic environment.

• It offers federal, government, and state-sponsored incentives.

• It provides equal opportunities for everyone.

• It allows you to easily find professional employees.

• Your intellectual property is protected.

• It allows you to increase your brand awareness.

• It helps you stand out by being a technology- and innovation-friendly country.

Disadvantages of Establishing a Company in America

There are also some disadvantages to opening a company in the US. We can list them as follows:

• Registering a company in the US can involve some complex processes.

• It requires you to take on legal responsibilities.

• The market is highly competitive.

• Language and cultural mismatch are experienced.

• Distance and time zones can bring about some challenges.

How to Start a Company in America?

To establish a company in America, you need to deal with some complex processes. However, it allows you to have a quite exciting experience.

1. Determine the type of company you will establish

You can establish your company as a sole proprietorship, corporation, or limited liability company. The tax obligations of each company can vary. In other words, you should conduct a detailed research before choosing the type of company you will establish.

2. Choose the location where you will establish your company

You need to thoroughly research which state you will establish your company in. At the same time, you must decide whether your company will be physical or online.

3. Obtain an Employer Identification Number (EIN)

You need to obtain an Employer Identification Number from the Internal Revenue Service (IRS) for your business. The EIN can be obtained via mail or through the internet. Because you need to obtain an EIN to hire employees for your company and to open the company's bank account.

4. Register your company

Your company must be registered in the state where you plan to operate. You must prepare the required documents for this. If you are considering establishing a corporation, "Articles of Incorporation" is the name of the document you must provide. It includes the company name, and the names and addresses of the incorporators.

If you are establishing a limited liability company, "Articles of Organization" is the name of the document you must provide. When you provide these documents, you get a "Certificate of Formation".

5. Obtain required licenses and permits

Depending on the nature of your business, you need to obtain various licenses and permits. Information regarding business licenses, professional licenses, zoning permits, and health regulations may be required.

6. Open the company's bank account

You must keep your personal and company financial accounts separate. To open a bank account, an ID, registration certificate, and Tax Identification Number are required. Some banks may request financial documents and a business plan.

7. Start hiring your employees

If you have employee needs, you should research salary, labor, and promotion law issues. If you want to employ workers from Turkey, you must deal with visa procedures.

8. Do not forget to record financial transactions

You must keep your accounting records regularly. You should keep receipts and invoices for all financial transactions of your business. Working with an accounting expert will ensure you progress logically.

Company Structures in America

There are 5 different company structures in America:

• Sole Proprietorship

• Partnership

• C Corporation

• S Corporation (Small Business Election Corporation)

• Limited Liability Company (LLC)

1. Sole proprietorship and partnerships

Their common and positive aspects are that their establishment is easy and hassle-free. Dealing with fewer paperwork procedures, you can quickly establish a Sole Proprietorship or Partnership through an individual.

The negative aspect is that in case of a lawsuit, your personal assets will not be protected. The lawsuit is filed against the founder of the firm, not the firm. The opposing party can intervene in all personal assets. Regarding the taxation aspect, individual information, company income, and expenses are declared in the tax return.

2. Corporation (c corporation) and small business election corporation (s corporation)

First, all companies are established as a C corporation. Later, a document is submitted to the Internal Revenue Service (the government department operating in the field of revenue administration in the United States). With that document, it is accepted as an S Corporation.

In the S Corporation model, the individual and the firm are kept separate. In case of a possible lawsuit, the action is taken through the firm.

In the taxation part, the firm's tax is examined separately. Tax deductions are utilized. In S Corporations, there can be a maximum of 100 partners, and money is raised by selling shares.

In addition, C Corporations and S Corporations must hold at least one general assembly meeting every year. All decisions taken in the general assembly must be filed and tracked.

Personal loans, credit reports, and the firm's credits are separate from each other. The disadvantage of S Corporation firms is the excess amount of paperwork. These processes need to be done in certain routines, otherwise, tracking them becomes difficult and their cost increases.

In this case, it is necessary to work with an accountant. Although the number of partners is unlimited, double taxation is applied. First, the firm pays tax on its own profits. If it distributes dividends, the distributed dividend is also taxed. Finally, the founders of these firms are required to be US citizens.

3. Limited liability company (LLC)

It is the company model that many people living in Turkey are interested in. It is known to be the most suitable model. It is most appropriate to establish the company with one person or two partners. When submitting the tax return, it is submitted on a double-sided basis, and a choice is made regarding taxation.

The establishment, examination, and taxation of the company are not complex. The company can be established anywhere in the world. Your personal assets are not touched. This is the company that people who want to sell on Amazon should establish.

For those living outside the US, firms are established through an Individual Taxpayer Identification Number (ITIN). To obtain this number, an application is made to the Internal Revenue Service (the government department operating in the field of revenue administration in the United States). When the firm is established, an EIN (US Employer Identification Number) is also obtained. This becomes the company's tax number.

Characteristics of Company Structures in America

The characteristics of company structures in America are as follows:

• Documenting the money you earn to the state

• Benefiting from some details regarding tax

• Developing your firm by selling shares

• Protecting your own assets in case of any lawsuit

• Keeping your personal credit and company credit separate

What Are the Required Documents to Start a Company in America?

Certain documents are required to start a company in America. They are as follows:

• ID or Passport

• An invoice proving your residential address

• Company formation certificate

• Tax Identification Number (EIN) of the company

Which Visas Are Required to Establish a Company in America?

If you want to establish a company in America, you must apply for an E-1 visa. Of course, this visa has temporary status. However, as long as you maintain the visa conditions, it is possible to extend your visa indefinitely. In this way, you get the opportunity to stay in the US for a long time.

The E-2 visa is suitable for entrepreneurs with capital. However, to obtain the visa, the country of which you are a citizen must have an agreement with the US. Turkey has an agreement. This visa also helps your family benefit from immigration services.

The EB-5 visa is very similar to the E-2 visa. In this one, the minimum investment amount is quite high. With this visa, you can obtain a Green Card. The L-1 visa allows a foreign company to transfer its manager to US companies.

Is It Possible to Establish a Company in the US Online?

It is possible to establish a company in America online. Information such as your name, surname, phone number, company type, and address is requested. First, you should think about what kind of company you want to establish and in which state you want to be located. The laws or regulations of every company type and state can vary. For this reason, you should not forget that you need to conduct a thorough research.

Costs of Establishing a Company in America

You may need to make some investments to establish a company in America. In other words, if you are researching the answer to how much it costs to establish a company in America, you need to do systematic research. Generally, you can pay between $50 and $2000 to register your business.

In addition, establishing a company in America is priced according to the states. At the same time, prices can change depending on the type of company you want to open. You should not forget that you also need to calculate the costs to establish a fast and secure company suitable for your needs.

What Should You Consider When Establishing a Company in America?

America has made opening companies easier for non-US citizens. But still, there are some details you need to pay attention to. We can list them as follows:

• You should take extra care to be precise while filling out the documents.

• You should develop a business plan and shape your budget accordingly.

• You must definitely research the feasibility of your business idea.

• You must make sure that you have met all the requirements to start a company in America.

Frequently Asked Questions

There are frequently asked questions about starting a company in America. We can answer them as follows:

1. Can a Turkish citizen start a company in America?

Yes, a Turkish citizen can start a company in America.

2. Who can start a company in America?

Almost anyone who meets the legal conditions in America can start a company in the US.

3. Is it mandatory to establish a company to sell in the US?

Unless you exceed certain limits, it is not mandatory to establish a company to sell in America.

4. How much does it cost to start a company in America?

The cost you need to pay to start a company in America varies depending on the type of company and the state.

5. What needs to be done to start a business in America?

You need to decide on your company type and the state where your business will be located.