Inspiring thoughts from
OUr CEO, Sarah Gould
OUr CEO, Sarah Gould
Are you starting a new business? First off - congratulations! Starting a new business is exciting, and doing it in Montana makes it even better.
Despite all the good stuff, the line between success and failure as a new business is narrow, and it’s essential to understand how to set yourself up for success.
In this blog, we’ll outline the biggest things you need to know before starting a new business and how you can get your venture off on the right foot.
Let’s dive in.
First Things First: Why Start a Business in Montana?
When it comes to launching a business, Montana is a great state to do it.
In 2020, Montana ranked 5th on Tax Foundation’s 2020 State Business Tax Climate Index, thanks to low property taxes and lack of statewide sales tax.
This is excellent news for new business owners: when you pay less tax, you’ll have more cash available to grow your business.
Here are a few additional Montana business stats to keep in mind:
6 Steps to Start a Business in Montana
You know Montana is a great place to start a business, so let’s talk about how to do it. Here are five steps to get you on your way to business ownership:
1. Come up with a business plan
You’ve got an idea, you’ve done some research, and now it’s time to develop a business plan. Think of a business plan like a roadmap: it tells you where you’re going and when you can expect to get there.
A good business plan should include the following sections:
2. Organize and register your business
Next, you’ll need to determine your formal business entity and register your company with the state.
This is undoubtedly one of the toughest parts of forming a business - mainly because it has so many tax and financial implications.
When it comes to business entity formation, there are a few main options to choose from:
Clear as mud? Don’t worry - you’re not alone. Deciding on the correct entity for your business can be tricky.
Because the tax implications are complex and long-standing, we highly recommend consulting a business accountant before you put anything in writing. An accountant will help you understand the pros and cons of the different entities and choose the one that best suits you and your goals.
Once you’ve decided on a business entity, you’ll need to register your business with the state of Montana. You can do this through the Montana Secretary of State’s Online Business Portal.
3. Get your federal and state tax ID
Next, you’ll need to obtain a Federal Employer Identification Number (EIN). An EIN is similar to a social security number, but for businesses. It allows you to open business bank accounts, initiate payroll, and file your taxes. You can apply for an EIN online via the IRS website.
4. Open business banking and credit accounts
Once you receive your EIN, you’ll need to open a bank and credit card account for your business.
This is a critical step even if you choose to operate as a sole proprietorship. Having designated business accounts allows you to track and manage expenses and navigate payroll and taxes easily.
5. Get all needed licenses and permits
The next important step is to obtain all the licenses and permits needed to operate in your area.
Restaurants, for example, will need a liquor license, while businesses like pawn shops will need reseller’s licenses.
If you’re unsure what licenses or permits you need, check out the MT Department of Commerce’s Business Checklist Tool.
6. Hire an accountant
Last, but certainly not least, you’ll need to hire an accountant to handle your business’s finances.
Business finances can get complicated and stressful in a hot minute, and it’s critical to get it right from the start.
Nobody wants to find themselves in the midst of an audit, scrambling to produce receipts (or else!), or lagging on profits simply because of money mismanagement.
Hiring an accountant can help you avoid all that nonsense from the beginning and take full advantage of the financial guidance and support you need to grow a thriving business.
Elevated Advisory and Accounting: Here to Help you Get Down to Business
Starting a new business in Montana is a major step, and our team is here to help.
We offer accounting and advisory services for companies throughout Montana’s Flathead Valley, with offices located in Whitefish and Kalispell. Our team will help you navigate all the financials - from payroll to profits and beyond!
Give us a call today to learn more.