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Start a Business in Idaho

Starting a business in Idaho requires a number of steps to make sure you’re protecting both yourself and your business as you grow. Follow these steps to start a business in Idaho.

Step 1: Create a business plan

Ready to take the first step on your entrepreneurial journey? Before jaunting down the startup road, you must first plan the path by creating your business plan. Investors, lenders, and grantors will request this plan when you seek financial help. It will be your resource when the going gets tough, so don’t skip the step.

To write your business plan:

  1. State your Idaho business idea: What problem does it solve or desire does it meet? This is the best way to start your business plan.
  2. Conduct market research: Market research to find competitors and similar businesses in your area will help you find what separates you from them.
  3. Commit to “SMART” goals (Specific, Measurable, Attainable, Realistic, and Timely): Identify goals and how you can achieve them. 
  4. Envision what could go wrong: What if your supply chain is impacted? How will you keep providing your service or product so as not to lose customers?
  5. Describe your ideal customer and be specific: Are they tourists? Residents? Other businesses? What age? Why are they coming to your business?
  6. Identify costs: Think about both things and people here, as well as any business loans you may have in mind, because you’ll want to include a payback plan.
  7. Choose a business location: If you’re going to have a storefront, then your business location is very important.
  8. Envision growth: Identify now how you might lead the business into that growth. 

The State of Idaho’s commerce division hosts an extensive resource on starting a business that includes more information on business plans.

Need help creating a business plan for your Idaho startup? We put together a comprehensive library of articles and guides on business planning.

Step 2: Choose a business structure

Small businesses in Idaho choose a business structure that makes sense for their industry, personal finances, and the size of the business opportunity.

As an owner, you need to decide how you will structure your business entity. There are several different types of businesses to choose from, and each has its pros and cons.

Sole Proprietorships

Sole proprietorships and GPs are unincorporated businesses that are free and simple to set up. Taxation is straightforward, but sole proprietors and GPs leave themselves open to personal liability if something goes wrong with the business.

For example, someone suing the business can go after the owner’s personal assets.

Corporations

The corporation structure offers liability protection, so if your business ends up in trouble, your home, bank accounts, and other assets are protected. C corporations come with a less-than-ideal tax setup that taxes income once at the corporate level and again on personal tax returns.

S corporations provide liability protection too, without double-taxation, but are harder to qualify for.

LLCs

An LLC in Idaho can be a best-of-both-worlds option. LLCs require more paperwork and setup costs than a sole proprietorship, but there are significant benefits as well. The biggest benefit of an LLC is that it legally separates your personal assets from the company. Ready to create your Idaho LLC? Use our LLC service in Idaho.

By doing so, it provides personal liability protection if the business files for bankruptcy or gets sued. Yet you’ll still only get taxed once for income, on your personal tax return, just like with a sole proprietorship.

We can file the paperwork to form an LLC or corporation for you with our business formation plans.

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Step 3: Determine your business costs

As part of your business plan, it’s important to figure out exactly what you need financially to both launch your business and operate it on a monthly basis. Calculating these costs will help you bring your dream company into reality. 

Startup Costs

Your startup expenses are typically one-time costs. You can factor them into the amount of money you need to get your business off the ground. However, you likely won’t get customers or sales on day one.

That means you’ll need to figure out how much it would cost to operate for 6 to 12 months. Assuming zero income during that time period will give your new company the financial breathing room to succeed. 

Curious about “how much it costs to start a business in Idaho?” Look no further. This helpful guide will walk you through business cost calculation and more.

Ongoing Costs

Some of the costs you can include in your calculations include: 

Step 4: Create a business name

Finding the right business name is one of the most creative and fun parts of starting a business. Many choose a name that resonates with their target customers. Others decide to pick names that mean something to them personally. Regardless of your decision, the name must be the only one of its kind in the state of Idaho.

Reserve a Business Name

You may also want to reserve your name with the Idaho Secretary of State until you’re ready to file your business formation paperwork. Reserving the name costs $20 online.

Secure a Domain Name

When picking your business name, it’s smart to establish an online presence, too, by securing a domain name. Even if your business name is available in Idaho, it could be taken by another business in a different state. If that company has a website with a domain name similar to your desired name, it could be tougher for you to operate online. 

If you’ll do business under company names other than your business’s legal name for branding purposes, then you’ll also need to register a DBA.

Step 5: Register your Idaho business and open financial accounts

Before registering your business with the Idaho Secretary of State, you can use Idaho.gov’s business wizard to learn which regulations apply to you. Once you’re up to speed, consider partnering with ZenBusiness to form quickly and easily, in a way that meets your specific needs. 

Apply for an Employer Identification Number (EIN)

If you’re starting an LLC or corporation, you’ll likely need to obtain a federal employer identification number (EIN) from the IRS. This is your federal tax ID, and you’ll also use it when hiring employees.

Recommended: Learn more about the benefits of an EIN and how to get one for your LLC or Corporation in our EIN information page.

Business Insurance

When all that’s done, you can open a business bank account and consider which types of business insurance you may need.Most small businesses start with general liability insurance and branch out from there based on the type of work they do.

Step 6: Market your Idaho business

Now that you can legally do business in Idaho, you’ll want to help your customers find you. Creating a marketing plan specific to your target customer is vital to growing your sales. Some strategies include building out web content and improving your search engine optimization (SEO), or finding the right print advertisements to distribute to potential customers. 

Social Media

Most businesses will want a well-established social media presence on sites like LinkedIn or Facebook. Not only will this help your SEO, but it will help build a community of potential customers. To know what’s right for your business, you can first do some market research and then create a plan.

Additional Resources

You can learn more from the Idaho Small Business Development Center’s marketing resources and from your local network.

Benefits of Opening a Business in Idaho

Idaho is an attractive state to start a business in because of its beneficial regulatory environment, lower than average tax situation, and strong state economics. There are a number of tax credits available to businesses for hiring employees, purchasing equipment, and more.

These are just some of the reasons Idaho — and Boise in particular — is one of the best places to start a business in the country. 

Idaho also boasts low startup costs. The state maintains a low minimum wage for businesses that need to hire employees, and a low median rental rate for residents. This makes it affordable to get your business off the ground. On top of it all, Idaho is a fairly easy place to check off all the legal requirements for your new business.

Still unsure what business structure in Idaho is best for you? Feel 100% certain by reading this guide that compares formation types.

Examples of Good Businesses to Start in Idaho

Idaho is well-positioned to export goods or sell services to both the Pacific Northwest and the Mountain West regions of the country. Businesses that do well in Idaho typically either take advantage of the state’s natural resources or benefit from its central location. Below are some examples of good businesses to start in Idaho. 

You’ll have the most chance for success by considering businesses that play to your strengths. You can check out the Small Business Administration’s Idaho profile to see how many companies are in each industry within the state.

Looking for more ideas? Discover your next big dream in our list of small business ideas.

Bottom Line

Idaho is a strong place to start a business if you understand how to get it off the ground. It’s important to find the right business type for you, and completely plan out how you could be successful first. Following our checklist will help you start your Idaho business on the right foot, and help you avoid costly mistakes.

Idaho has made starting and operating a business as beneficial and easy as possible. In fact, Idaho has exempted more than 90% of all businesses in the state from personal property taxes and has some of the lowest corporate taxes in the country. Starting a business requires a number of steps to make sure you’re protecting both yourself and your business as you grow.

Idaho Business FAQs

  1. How much does it cost to start a business in Idaho?

    The total cost of starting a business in Idaho varies by industry and even business type. However, you can register your Idaho LLC for the state filing fee of $100 online.

  2. Do I need a state business license in Idaho?

    No, Idaho does not have a state business license requirement. You could have other licensing requirements depending on what you’re selling or whether you hire employees.

  3. What is a good city to start a business in Idaho?

    The right city in Idaho for your business will depend on your industry and where your customers are. Boise, Idaho Falls, and the northern vacation spot of Coeur d’Alene are great places to get started.

Idaho Business Resources

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