How to Form a Company in Connecticut
Introduction
Forming a company in Connecticut is a simple process, but it takes time. After you’ve decided on your business name and have filed your articles of organization with the Secretary of State, you’ll need to obtain a federal tax ID number, register for unemployment insurance, obtain state sales and use tax permits if necessary and register for any other licenses or permits that apply to your industry.
Choose a business name.
Choosing a business name is one of the first steps to forming a company, and it’s an important decision. Your business name should be easy to remember and unique, so that people can tell you apart from your competitors. It should also be available as a domain name, which means that it’s not already taken by someone else on the internet (this is important because who wants to go through all this work only to have their website address end in “businessexample123456789”).
You’ll also want to consider whether your business name can be used on social media platforms like Facebook and Twitter.
Filing and naming your business.
Your first stop is to file a statement of organization with the Connecticut Secretary of State. This will cost $100, and it should be done within 90 days of forming your company. You also need to file a trade name registration with the Connecticut Secretary of State; this costs $115 and must be done within 60 days after you register your business with them (that’s when they send out their approval). Finally, you need to file articles of organization at the same time as your statement of organization; this costs $105.
To complete these filings, you’ll need an Employer Identification Number (EIN) from the IRS—you can apply for one online or over the phone by calling (800) 829-4933 Monday through Friday between 6 am and 6 pm EST. You’ll also have to register for unemployment insurance as part of forming your company: visit CTUnemployment Insurance Online Services at ctuioss.com/newemployer/.
Register your trade name with the Connecticut Secretary of State.
- Register your trade name with the Connecticut Secretary of State.
- Get a Certificate of Good Standing.
- Use a service like Legal Zoom to help you file the paperwork.
Create an operating agreement.
The operating agreement is a document that outlines the responsibilities of each member, including their role in decision-making and how much money they will be paid (if at all). It also includes an outline of how the company is structured and what its policies are.
The reason why this document is so important is because it helps to prevent disputes from arising between members regarding their rights, responsibilities and compensation. Without such a document in place, it becomes difficult to know who owns what parts of the company should a dispute arise.
Create and file articles of organization.
In Connecticut, you must file articles of organization with the secretary of state. The purpose of these articles is to establish your business and give it a legal status, which allows you to operate in the state. You will need to create and file these documents before you can receive any permits or licenses.
The articles should include the name and address of your company and the names, addresses and signatures of its owners. If there are multiple owners, all must sign on behalf of their respective shares in order for the incorporation to be valid.
File your business with the Internal Revenue Service (IRS).
After you have formed your LLC, you will have to file your business with the Internal Revenue Service (IRS). The IRS uses a nine-digit number called an Employer Identification Number (EIN) to uniquely identify each taxpayer. The EIN is used on all tax returns and correspondence, so it should be obtained before or at the time of filing for your LLC. This can be done either online or by mail. If you choose to do this over the Internet, simply go to www.irs.gov/businesses/small/article/0,,id=107320,00.html and enter “New Hampshire” as a state code when prompted; then click “Continue.” From there, follow along through each step until completion; once completed successfully, your EIN will be emailed directly from the IRS within five business days at most! An alternative way is if someone else has already applied for one using their information instead (like an accountant), but since this would require sending them money first with no guarantee they’d actually do it anyway… It seems much easier just going through yourself directly with no middleman involved! In fact I would recommend doing so because there’s nothing worse than paying someone else’s bill when theirs isn’t even due yet so why not just pay yours right now?
Get a federal tax ID number (EIN).
You’ll need to get a federal tax ID number (EIN) before you can form your company. This is what the IRS uses to track your business. You can request an EIN by completing Form SS-4 and filing it at the IRS website. Your EIN will be mailed to you within three weeks of filing Form SS-4, but it’s best to apply for one sooner rather than later, so that everything is ready once you decide on a name and move forward with incorporating your company.
Once you’ve received your EIN, add it on all paperwork related to starting up your business: office lease agreements, financial documents like bank account applications—anywhere someone asks for proof of incorporation or ownership of the company name or assets. You can also use this number when reporting income from self-employment taxes (Schedule C).
Obtain a Connecticut sales and use tax permit.
To get started, you will need to complete a Connecticut Sales and Use Tax Permit Application. You can find an online version of this application on the Connecticut Department of Revenue Services (DRS) website.
If you plan to sell goods or services in Connecticut, state law requires that you obtain a sales tax permit. If you are required by law to get one and don’t, the penalties can be steep: up to $1,000 per month plus interest if your business is large enough and/or has been operating for more than six months without filing sales tax returns; jail time if there are fraudulent activities involved with obtaining a permit or conducting business without one; and hefty fines up to $50 per day if no permit was obtained after being notified by DRS
Obtain a liquor permit, if needed.
Liquor permits are required in Connecticut and cost $100. If you plan to sell alcohol, you must obtain a liquor permit. The application process is handled through the Department of Consumer Protection, which is run by the state government.
You’ll need to submit an application containing:
- A completed form indicating your name and address
- Evidence that you’re at least 21 years old
- Your social security number or tax identification number (TIN)
Register for unemployment insurance.
- If you hire employees, you must register for unemployment insurance. You must register within 30 days of starting your business and pay a fee to do so. The form required is called a UI-1.
- Registering for unemployment insurance will get you an employer identification number (EIN). This is used instead of your social security number when dealing with the state, banks etc.
Takeaway:
The takeaway here is that it’s possible to form a company in Connecticut without an attorney, but you’ll have to do some research and be prepared for some legwork.
That being said, forming a company can be a complicated matter—especially if you’re doing it for the first time. If you need help with this process, contact us today!
Conclusion
We hope this article has helped you to understand the basic process of forming a company in Connecticut. If you have additional questions, don’t hesitate to contact us! We would love to help you with your new business.
