How To Set Up A Business In Wyoming
The Tax Foundation ranks Wyoming as the most tax-friendly state in the country. The state does not levy corporate income tax, individual income tax or gross receipt tax. Furthermore, it’s sales tax rate is the top 25% in the country. The state also has the fourth highest rate of new entrepreneurs in America, giving new entrepreneurs a rich community of entrepreneurs to learn from, partner with and measure yourself against. Wyoming also has a ratio of businesses created to businesses shutdown, of 1.61, giving it one of the best business survival records in the U.S. Given the difficulties that startups have in surviving, this is a huge point in the state’s favour. Now that I’ve whetted your appetite, i’ll tell you exactly what you need to do to set up a business in Wyoming.
Develop a Business Idea
The great managerial thinker, Peter Drucker, liked to say that “The purpose of business is to create and keep a customer,” by which he meant that a business must offer compelling value to the public such that it persuades them to buy its products and becomes an ongoing customer of the firm. Without a compelling value proposition, there is no business.
You should be guided by the realization that in order for a business to earn sustainable economic profits, it must have a competitive advantage. Without a competitive advantage, customers can easily switch to another company. For instance, Google’s search engine has a competitive advantage over other search engines. The advantage is so big that the word Google has become synonymous with searching the web. Google provides a service that no other firm can replicate.
Determine the Best Business Structure for Your Firm
When you start a business, you have to decide on a business structure. This decision will have tax and legal implications so must not be taken lightly. The business structure you choose will determine the income tax return form that you will have to file. The most popular business structures are the corporation, partnership, S corporation and sole proprietorship. The Limited Liability Company (LLC) is a business structure permitted by state statute. For more information about business structures, visit the Small Business Administration’s (SBA) Choose a Business Structure webpage.
Pick a Business Name
If you are a sole proprietor choose to do business using their own name. For instance, if your name is John Smith, you may do business as John Smith, in which case, you do not need to apply for a business name. However, if you use a different business name, such as John Smith Accounting, you have to register a business name by filling out an Application for Registration of Trade Name with the Wyoming Secretary of State.
Corporations and LLCs have to check to see if their business name has not already been registered in Wyoming. This can be checked with the Secretary of State.You can check for a business name by performing an online business entity search on their platform. Business names can be reserved for 120 days by applying for a name reservation -corporations and LLCs fill out different forms-.
If your business will be online, you will also have to choose and register a domain name.
To secure your trademark against infringement, register your business name with the U.S. Patent and Trademark Office. You will be required to do a trademark search before registering, in order to ensure that your trademark has not already been taken.
Apply for Permits and Licences
Businesses selling products in the state have to register with the Department of Revenue so the state can collect taxes from your business. This is done by filling out a Sales and Use Tax Licence Application on the Wyoming Internet Filing System for Business or by mailing the department the application form.concerns on sales tax here.
You also need to obtain an Employer Identification Form (EIN) if you have any employees, regardless of business structure. An EIN is obtained from the Internal Revenue Service. You may not be required to have an EIN, but there are good reasons for doing so anyway. Many banks require an EIn before they can issue a business with a bank account. Other companies may want you to have an EIN in order for them to process payments.
Business licences and permits are needed for businesses involved in the environment, health and safety, building and construction and certain industries or services. The Wyoming Business Council publishes the Business Permitting and Licensing Guide, which gives an excellent overview of the regulatory requirements. For more information about licences and permits at the municipal or county level, you will have to visit the websites of the cities and counties you will be operating in.
Professional and occupational licences are required of people working in certain fields. The state’s Department of Administration and Information has a list of some of the regulatory boards for licenced occupations and professions. If you know the regulatory board’s name, you can search for it on the Governor’s Boards and Commissions website. The Business Permitting and Licensing Guide has a section on the statewide agencies that issue professional and occupational licenses.
As we said in the introduction, Wyoming does not levy corporate tax or personal income tax. Wyoming State Business income Tax provides a good guide to state business tax in Wyoming.
Corporations and LLCs have to file annual reports with the Wyoming Secretary of State. You can learn more about LLCs to further understand your regulatory obligations. Alongside Wyoming taxes, businesses are subject to employer taxes and federal income tax. Refer to the Tax Guide for Small Business and Taxpayers Starting a Business for more information.
Check Your Preferred Business Location’s Zoning
If you need an office or physical location for your business, you will have to check zoning for that area before committing. Wyoming, like all states, has regulations governing what activities can occur in certain areas. So you will have to check what the area has been zoned for. You can do this by reviewing your city’s ordinances and contacting its planning or zoning department.