Creating Your Business Entity

What type of business are you going to start? In most state your options are to incorporate, create a limited liability corporation, or to start a sole proprietorship. Each of them has advantages and disadvantages such as protecting you from liability or reducing your tax burden.

We strongly recommend that you consult an attorney or CPA if you aren't well-versed in the different types of companies.

You may be required to do any or all of the following in your state:

Register your business name (fictitious name)
Acquire a general business license
Register to collect sales tax
Register as an employer
Purchase workers compensation and/or bonding insurance

All employers are required to register for a Federal Employer Identification Number (FEIN). The Internal Revenue Service provides an online application. Even if you don't yet have employees, this should be one of your first steps. Some states require that you apply for an FEIN before registering in that state. The FEIN will be used on future tax filings as well as on your corporate bank accounts.

Finally, an increasing number of states are requiring licenses specific to home care agencies. In some states these licenses are limited to organizations that provide skilled nursing care, and in other states the licenses also cover non-medical home care.

We have compiled this directory which contains resources from each state. While much of the licensing information is up-to-date, we still strongly recommend that you work with an attorney or accountant in your community.

Resource Links

Federal Employer Identification Number online application
State-by-State Directory of Business Start-up Guides
State-by-State Directory of Home Care Licensing Requirements

Subscribe to
Private Duty Today's
free biweekly
e-mail newsletter

Read back issues of
Private Duty Today