How to Start a Business in Louisiana
Have you ever thought about starting a business in Louisiana but weren’t sure how to begin? You’ve come to the right place! We look at what you need to start a business, legal and tax requirements, and a few extra necessities along the way.
Begin with a Plan
All great businesses start with a great business plan, which covers things like:
- Whether you’ll sell a product, service, or both
- Whether you’ll have a physical location or online-only presence
- Your target market
- The amount of financing you’ll need to launch your business
- How to market your business
- How to grow your business
Putting the basics of your business in writing will not only give you a clear path to follow to reach your goals, but it will also give potential investors and partners the confidence to invest in you and your business.
If you need help crafting a business plan in Louisiana, the Louisiana Small Business Development Center has a business plan checklist you can download that uses guided questions to lead you through each part of a business plan, along with sample business plans for your review.
Once you’ve got your business plan down, you’re ready to select the right business structure.
Choose Your Business Structure
One of the first things you’ll need to do once you’ve completed your business plan is choosing how to structure your business. In the state of Louisiana, there are several options available to you, including:
- Sole proprietorships
- Partnerships
- Limited Liability Partnerships (LLP)
- Limited Liability Companies (LLC)
- Corporations (including Nonprofits)
Each business structure has its own unique pros and cons.
For example, forming an LLC means your personal assets are protected if anything were to happen to the company; however, you will need to file additional paperwork for the business, such as articles of organization.
Some business owners prefer sole proprietorships because they typically have fewer legal requirements to fulfill than other business structure types.
Most business structure types will also be required to have a registered agent who can receive official documents on behalf of the business with a physical address in the state (not a PO Box).
If you’re unsure which business structure to choose, you can always consult with a business attorney licensed to practice law in the state of Louisiana for additional help. They will help your form the right entity to suit your tax and legal requirements.
After you’ve selected the best business structure for you, it’s time to reserve a business name.
Choose a Business Name
Almost immediately after you’ve chosen a business structure, you’ll need to reserve your business name with the Secretary of State. For most business structures, this will cost $25.
To do this, you’ll need to select a name that isn’t currently in use. You can do this by searching for your business name on the Secretary of State’s website. You may need to be flexible if your preferred name has already been chosen by someone else, and go with your second, third, or even last choice to have a unique name.
Once you’ve found a unique business name and reserved it with the Louisiana Secretary of State, you’re ready to get a federal tax ID number.
Obtain a Federal Tax ID Number
Nearly every Louisiana business needs a Federal Tax ID number, also known as a Federal Employer Identification Number, or EIN for short. This number makes it possible for your business to pay federal and state taxes.
The IRS website allows you to easily register online and helps you determine if you’re one of the lucky few who can use their existing social security number (such as sole proprietors) or if you need an EIN.
Now you’re finally ready to register your business with the state of Louisiana!
Get Registered in Louisiana
Your business will need to be registered with the Louisiana Secretary of State, and if you plan on hiring employees, you’ll also need to register with the Louisiana Workforce Commission.
In Louisiana, you’ll need to create an online account in order to register your business if you plan to operate in any of the following 14 counties:
- Ascension
- Bossier
- Caddo
- Calcasieu
- East Baton Rouge
- Jefferson
- Lafayette
- Livingston
- Orleans
- Ouachita
- Rapides
- St. Tammany
- Tangipahoa
- Terrebonne
All other counties have the option of registering online, but you aren’t required to.
Registration fees vary depending on the business structure, as indicated below:
- Corporations: $75
- LLCs, Partnerships: $100
- LLPs: $125
Veteran-owned businesses that are registered with the state may be eligible for a special program allowing them greater access to the state government’s bidding and contracting system, enabling veteran-owned businesses to work on state government construction, software systems, maintenance, etc.
Depending on your business type, you may be required to obtain specialized tax accounts and/or other permits or licenses in addition to your business license.
Obtain Louisiana Tax Account(s)
All Louisiana businesses must register with the Louisiana Department of Revenue to pay business income tax. In order to register, you’ll need to provide a NAICS code for your business, which indicates the industry (i.e. barbershop) your business is in.
You’ll also need to know your Louisiana Parish code to register with the Department of Revenue.
Depending on your business structure and type, you may be required to pay one or more of the following types of taxes:
- Composite Partnership Tax
- Corporation Income Tax
- Corporation Franchise Tax
- Excise Tax (including tobacco and/or alcohol taxes)
- Sales Tax
- Severance Tax
- Use Tax
- Withholding Tax
You may also be required to pay municipal or county taxes in addition to the state taxes indicated above. If you’re unsure which taxes your business owes, you may wish to consult with a licensed Louisiana tax attorney.
Your business may also need additional licenses or permits to operate in the state before you’re ready to welcome customers.
Obtain Specialized Permits/Licenses
You can create a business license checklist when you begin the registration process, which will give you a list of required licenses you’ll need to obtain in order to legally operate in the state of Louisiana.
Depending on the industry, you may need to obtain at least one or more additional permits/licenses before you can open your business. These industries include:
- Arborists
- Attorneys
- Cosmetologists
- Florists
- Home Inspectors
- Landscape Horticulturists
- Physicians
- Surveyors
- Veterinarians
This is not an exhaustive list of all business types that require additional permits or licenses, and depending on your business, you may need more than one specialized license or permit.
Now that you’ve taken care of your legal and tax requirements and have gotten fully registered with the state, you may think you’re finally ready to open for business. But don’t forget about a crucial item that many business owners ignore until it’s too late.
A Reliable POS System
While your choice of a point of sale system may not seem that important, your customers will remember how easy (or how difficult) their payment experience was. You want a system that’s secure, efficient, and reliable.
That’s where Epos Now can help. Our POS solutions are suitable for a variety of businesses, and you can choose from desktop, tablet, and even handheld options. What’s more, Epos Now systems integrate with dozens of apps so you can take care of all your business needs from one device.