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Utah is a beautiful state to call home. It’s full of mountains that see an average of 500 inches of snowfall each year, and is home to iconic locations like the Great Salt Lake. Utah is also a great state to begin your business. It boasts a healthy workforce and relaxed regulatory environment. Its strong economy makes starting a business in Utah an easy choice.
Forbes recently ranked Utah 2nd best in the United States for business. Chances for success are high here, with 79.27% of startups in Utah making it past that tough first year.
Financial help is readily available, too. Venture capital firms like Park City Angels, SLC Angels, and Utah Angels 2 call Utah home. There’s even a directory of angel investors ready to support the next great business idea in Utah.
Utah makes it easy to do business in the state. The process is simple thanks to low fees and online systems for applications, licenses, and permits.
When you have a great business idea, you want to hit the ground running. But have you thought about how you’re going to structure your business? How you form your business determines how you’re going to manage it. It also determines the type of taxes you’ll pay. Here are the types of business entities you can form in Utah:
Since Utah is so friendly to entrepreneurs, what’s keeping you from getting started? Here’s your checklist start a business in Utah:
Right now, you may have a million ideas racing through your head for your own business. Getting those thoughts on paper helps you see if those ideas could work. It also shows what areas you might be forgetting about, and how best to position your dream for success. Remember all those potential angel funders in Utah? They’ll want to see your business plan, too. So, take some time to create a stellar one.
When you choose a type of business entity, do it with your specific tax situation and goals in mind. Some of the most common business structures are corporations, sole proprietorships, and limited liability companies (LLCs).
Under the law, a corporation is its own unique entity. Corporations pay taxes once at the corporate level, and then again as personal income. This is why some people choose not to use a corporate structure, since the money gets taxed twice.
At the opposite end of the spectrum is a sole proprietorship. If you own a sole proprietorship, you pay taxes on the money your business earns through your personal income tax. A sole proprietor’s money only gets reported on your personal taxes. One risk to owning a sole proprietorship – if you run into legal trouble or debt, you may face losing your personal assets. As a sole proprietor, your personal assets are vulnerable to lawsuits or other claims against the company.
A middle ground many Utah small business owners use is the limited liability company. A limited liability company, or LLC, gives you personal asset protection. An LLC can help you avoid double taxation as well.
You can file for any of these business structures on the Utah.gov website. The website also gives information on permits, licenses, or business registrations you may need. If you’d rather focus on launching your business, we can help! Our registered agent services give you fast and reliable formation services so you can do what you love – creating your own business.
If you want to have peace of mind, you need to figure out the costs of starting a business. You want to know exactly how much you need to get your business going. You’ll have several costs of doing business in Utah. These include several fixed, one-time, and ongoing costs. Here’s what we mean:
Not sure you’ve accounted for everything? The Small Business Administration (SBA) offers a handy checklist for calculating startup costs. You can also check out our guide to calculating your small business startup costs in Utah.
Don’t feel overwhelmed if you complete this step and realize how much it costs to start a business. Don’t panic! Remember, Utah has financial help at the ready. The state wants your business so much that they even have a workshop to teach you how to access financial assistance.
Naming your business is a crucial decision. Your business name can grab attention or turn customers away. It depends on how understandable, distinct, and memorable the name is.
Of course, you can’t pick a business name that’s already in use. Getting sued is not a good look for your business. You can choose to form your LLC under one name and then file for a “doing business as” (DBA) name. This allows an entity to do business under an assumed name, but be legally owned by your LLC.
Even if you check the Utah business registry and find that the name is available, you’re not quite done. What if someone already has that website locked down? Check domain availability and, if no one else has taken it, register the domain name. Make sure your business name is available on the social media platforms and sign up for those, too.
Remember that structure you picked? Time to commit. Register your LLC or corporation with the state of Utah. Now you’re official in the eyes of the state. But don’t stop there. If you formed a corporation or LLC, you need to get a federal employer identification number (EIN). Note that sole proprietors can use their social security number as their federal tax ID number. An EIN isn’t required for that business structure.
Take any registration documents and EIN paperwork you have to a bank and open a business bank account. In Utah, you have small business-friendly banks where you can also apply for a business credit card.
Lastly, determine what type(s) of business insurance you need. The most common are liability insurance and workers’ compensation. Business insurance is important for protecting your new business.
Now that you’ve formed your business, it’s time to get some customers. If your business serves the local community, sign up on Google My Business. This is the No. 1 way new customers discover businesses.
Consider having an open house or partnering with established businesses to launch your company. Join a civic group or serve at a non-profit. Relationships drive business, so spend time building yours.
Your business website is also a crucial way to find new customers. To get the biggest bang for your buck, make sure it is search-engine-optimized. That means you are creating content and using keywords that people are looking for. Search engines like Google or Bing recognize when your website has authority on a topic. They can reward you with a place in the top search results.
Need help getting your business website off the ground? Use our website tool to create a beautiful website that turns leads into customers.
Remember those social media presences you snatched up? Time to put those to use. Create a social media strategy and execute it. If you don’t have time, hire a local high school or college student to help out. Be sure to pay them a fair wage for their time.
Ask for email addresses whenever possible. Be sure to send useful information to your list on a regular basis. For instance, let’s say you’re selling candles. Email them an article about how to arrange a date night and include candles as part of the article.
The economic state of Utah is strong. Half of Utah’s leading private-sector industries reported net job gains despite the COVID-19 pandemic. These include trade, transportation, utilities, construction, financial activities, and manufacturing.
The state saw declines in leisure and hospitality services. Other sectors that experienced declines are professional and business services, information, health and education services, and mining.
Utah is a beautiful state with government policies suited for new businesses and a diverse and available workforce. There are several opportunities to find startup funding, including small business grants. And you can use online services that make establishing a new business quick and easy. There’s no reason to delay your journey on the path to running a successful business in Utah.
The median household income in Utah is $10,068 higher than the national average. Utah’s median household income is $75,780.
A tech business is a solid fit for Utah. South Jordan has become known as the Silicon Slopes for its wealth of tech startups and skiing. Lehi is a part of that, as well. Logan has Utah State University, whose specialities in science, engineering, and research help ensure you’ll have knowledgeable workers. If you’re more into manufacturing and retail, check out the Salt Lake City suburb of Taylorsville.
Utah LLC fees start at $70, but there are more costs to keep in mind, including $22 for the option of reserving your business name or filing for a DBA name.