What's in a Name?

• Your business name is more than a hope for recognition among your potential customers; it determines what information you need from and must give to the Commonwealth of Massachusetts. If your business bears your legal name, like "John Smith's Burgers," you are not required to file an assumed named with the clerk of the county where your business is located. If your business has another name, use the free Trademark Electronic Search System to insure your choice is available before registering with the county.
  
  

Taxes

• Doing business as a sole proprietorship eliminates the need to file separate personal and business income taxes; your profits and losses are reported on Schedule C of your annual income tax filing. Massachusetts, however, requires sole proprietors who expect to owe more than $400 in taxes to the commonwealth or more than $1,000 to the federal government to remit estimated income taxes quarterly. Obtain the correct forms and filing instructions from the Massachusetts Department of Revenue.
  
  

Licenses and Permits

• Which licenses and permits your business requires is largely determined by your industry. A hot dog vendor will need different documentation than a roofing contractor or a psychologist. Food service establishments will require health and safety inspection as well as food service certification, and new construction will require building and electrical permits. Contact the Massachusetts District Office of the Small Business Administration for guidance in determining which permits and licenses your particular business needs. The information is also available on the Commonwealth's official website.
  
  

Hiring Employees

• The decision to hire others to work in your business, even your spouse and children, requires you to file additional tax registrations and obtain both workers' compensation and unemployment insurance coverage. You must obtain an Employer Identification Number from the IRS and register with the Massachusetts Department of Revenue to collect payroll withholding taxes. Additionally, you must report every new hire to the Massachusetts New Hire Reporting Center.
  
  

Open a Bank Account

• The Citizen Media Law Project advises sole proprietors to separate their business and personal finances by opening business bank accounts as soon as possible. You will typically need both your business license and employer identification number as proof of your business identity; however, if your business name includes your surname, your state issued identification may suffice. Contact your bank to determine its specific requirements.