How to Register a Business: The Paperwork, Step by Step

"Registering a business" sounds like one form. It isn't. It's seven steps across three different agencies (your state, the IRS, and your city or county), and doing them out of order is the single most common reason founders end up refiling paperwork, paying late fees, or opening a bank account they have to close and redo.

If you already know how to register a business, the process is fast: most people move from paperwork to open-and-operating in two to six weeks. This guide walks through the actual sequence, in the order agencies expect it, with a Texas example showing what it looks like end to end. It assumes you've already decided on a business structure. If you haven't, that decision comes first.

How to register a business: the 7-step sequence

Every state has its own forms and fees, but the underlying order is the same everywhere. Skip a step, or do them out of sequence, and the next one usually gets rejected or delayed.

1. Pick your business structure (briefly)

Before you file anything, you need to know what you're filing as. A sole proprietorship needs no state filing at all. An LLC or corporation does. If you're still weighing LLC vs Inc or deciding when to switch from sole proprietorship, settle that first. Everything below assumes the structure question is answered.

2. Choose and check your business name

Your name has to be available in your state's business registry before you can file anything with it. Most Secretary of State websites have a free name-search tool. Search it before you fall in love with a name, print business cards, or build a website around it.

If you plan to operate under a name different from your own legal name or your LLC's registered name, that's a separate filing called a DBA (doing business as). It's common enough that it's worth understanding on its own. Here's what a DBA actually covers and when you need one.

3. Register the entity with your state

This is the step most people picture when they think of "registering a business," and it's the one that actually creates your legal entity. If you're forming an LLC or corporation, you file with your state, usually the Secretary of State's office, a Business Bureau, or a similar business-filing agency. The document is called Articles of Organization for an LLC or Articles of Incorporation for a corporation.

If you're staying a sole proprietor, there's no entity to register with the state. You may still need a DBA if you're using a trade name, and you'll still need local licenses (step 6). The U.S. Small Business Administration notes that most small businesses only need to register their business name with state and local governments, and the total state filing cost is typically under $300.

4. Get an EIN from the IRS (it's free)

Once your entity is registered with the state, apply for an Employer Identification Number (EIN) from the IRS. Think of it as a Social Security number for your business: you'll use it to open a bank account, hire employees, and file taxes.

The IRS EIN application is free, done entirely online, and takes minutes if your paperwork is in order. One sequencing detail matters here: form your entity with the state first. Applying for an EIN before your state filing is approved is a common cause of delayed or mismatched applications.

5. Register for state and local taxes

Depending on your state and what you sell, you may need a state tax ID, a sales tax permit, or both. States with sales tax generally require a seller's permit before you make your first taxable sale. States with income tax may require separate business tax registration. Requirements vary enough by state that the SBA's state tax ID guidance is a useful starting point before you check your specific state's requirements.

6. Get licenses and permits for your industry and location

Federal licenses apply to specific regulated activities (aviation, alcohol, firearms, broadcasting, and similar categories). Most founders will never touch these. State and local licenses are the ones that actually apply to most small businesses: a general business license, a health permit for food service, a contractor's license, a home-occupation permit if you're running the business from home. The SBA's licensing guide breaks down which activities trigger which requirements. Check your city and county directly, since this is the layer the SBA can't fully cover for you.

7. Open a business bank account

This is the last step, and it's the one that finally separates your business money from your personal money. Banks typically ask for your state filing confirmation, your EIN, and your formation documents (operating agreement or bylaws) before they'll open the account. Doing steps 3 and 4 out of order is the most common reason this step stalls: without an approved entity and an EIN in hand, most banks won't open a business account at all.

A Texas walk-through, as one concrete example

Here's what the sequence looks like for a founder forming an LLC in Texas, since requirements vary by state and it helps to see one in full.

1. Choose a structure. Founder decides on an LLC for liability protection without corporate-level complexity.
2. Check the name. Search the state's business name database to confirm availability before filing.
3. File the entity. File a Certificate of Formation for the LLC with the Texas Secretary of State. Texas charges a filing fee in the neighborhood of $300, and approval typically takes anywhere from a few business days (expedited, for an added fee) to a few weeks (standard processing).
4. Get the EIN. Apply for a free EIN directly through the IRS online tool once the state confirms the LLC is on file.
5. Register for state taxes. Texas has no state income tax, but most businesses selling taxable goods or services still need a sales tax permit through the state comptroller before their first sale.
6. Pull local licenses. Depending on the city and industry (a general business license, a food handler's permit, a signage permit), check with the city or county directly, since Texas does not require a blanket statewide business license.
7. Open the bank account. With the Certificate of Formation and EIN confirmation in hand, open a dedicated business checking account.

Other states swap the specific agency names and fees (some charge as little as $35, others charge several hundred dollars, some require a state income tax registration Texas doesn't) but the order stays the same: structure, name, entity, EIN, taxes, licenses, bank account.

What it actually costs and how long it takes

Costs and timelines vary by state, but the general ranges hold across most of the country:

Step	Typical cost	Typical timeline
State entity filing	$35-$300+ (varies widely by state and structure; sole proprietors skip this filing entirely)	Days to a few weeks (faster with expedited processing)
EIN	Free	Immediate, same session
DBA (if needed)	$10-$100, varies by county/state	Days to a few weeks
State/local tax registration	Often free to register; ongoing tax obligations follow	Same day to a couple weeks
Licenses and permits	Ranges from free to a few hundred dollars, industry-dependent	Days to a couple months for specialized permits

Budget for the paperwork to take two to six weeks end to end for a straightforward LLC or corporation, longer if your industry needs specialized permits (food service, contracting, childcare, and similar regulated fields tend to run longest).

Mistakes that cost founders time and money

Skipping licenses because the state filing felt like "the paperwork." State registration creates your entity. It doesn't automatically cover the license your city requires to operate a storefront, food service, or a home-based business. Founders who assume one filing covers everything often get flagged months later during a routine inspection or audit.

Using a Social Security number instead of an EIN. Sole proprietors can technically use their SSN for some tax filings, but doing so ties your personal identity directly to every business transaction and makes it harder to open a business bank account or bring on contractors. An EIN is free, and there's rarely a good reason to skip it.

Filing for an EIN before the state entity is approved. The IRS explicitly recommends forming your entity with the state first. Applying too early can create a mismatch between your EIN application and your actual legal entity, which then needs to be corrected later.

Assuming DBA and entity registration are the same thing. A DBA lets you operate under a different name. It does not create a legal entity or provide liability protection on its own. Plenty of founders discover this the hard way after assuming a DBA gave them the same protection an LLC would.

How AI tools speed up the paperwork

The registration sequence itself doesn't change, but the busywork around it does. AI tools can draft the operating agreement or bylaws your bank will ask for, pre-fill state formation documents based on your answers to a short questionnaire, and generate a checklist scoped to your specific state and industry instead of a generic national one. None of that replaces filing with your state or applying for your EIN directly, but it cuts the hours spent figuring out which form applies to you.

What this means for you

The paperwork behind registering a business isn't complicated once you see the order: structure, name, state entity, EIN, taxes, licenses, bank account. Most of the confusion founders run into comes from doing these out of sequence, not from any single step being hard on its own.

This guide is educational and not a substitute for legal or tax advice. Requirements, fees, and timelines vary by state and change over time, so confirm current details with your state's filing agency, and loop in a CPA or attorney if your situation involves multiple states, investors, or a regulated industry.

EntraWorld's AI tools can walk you through the formation documents and checklists scoped to your state, so you're filing in the right order the first time. Join EntraWorld free and turn the paperwork into a checklist instead of a guessing game.