How to start a business in Nevada in 8 steps
Driving down U.S. Route 50, lovingly called the “loneliest road in America,” you might think Nevada is an empty, desolate state. You’d be wrong; the Sagebrush State has actually added 400,000 residents in the last decade.
Many newcomers arrive with the dream of starting a new venture to support themselves. And this business-friendly state gives them a lot to get started: an expanding commercial real estate market, low costs, and no personal income, corporate or franchise taxes. It’s no wonder that small businesses are popping up as fast as new home developments across the state.
Nevada deals new business owners a good hand, but they must still play by the rules when starting a business in the state. Let’s dive into 8 fundamental steps you can take to make sure your new business hits the jackpot.
1) Think about the type of business you want to start
All profitable business ideas start with passion, which means you likely already know what kinds of companies you’d be excited to build. You should also ask yourself whether the needs of those businesses align with your abilities.
For example, do you need to work online, or can you open a brick-and-mortar business? Will your business depend on plentiful foot traffic from tourists in places like Lake Tahoe, Reno, or Las Vegas? There are hurdles and challenges regardless, but combining your expertise and budget will dictate the best path forward for you.
Aside from the logistics, it is essential to ask yourself these 5 questions about whether a small business is a right move. All types of businesses take hard work and investment to launch. When success seems as hard as surviving another Nevada summer, do you have what it takes to stick it out and get your business up and running? Be honest with yourself.
If you’re ready to jump into the process, the Nevada Small Business Development Center (SBDC) is your first stop. They offer help on everything from grants and fundraising for small businesses to industry-specific training. The organization offers in-person training across the state, in Reno, Carson City, and Las Vegas. They teach on topics like financial planning, data analysis, and marketing, and even have classes in Spanish.
Once you’ve got a good idea, check out the local competition and providers of similar services across the state. What are they doing to boost their businesses and where can you stand out? Make a business plan, which will be a prerequisite for working with many investors and lenders to get your business off the ground. It should include an estimate of how profitable you can be, what you will offer, and how you will advertise your new business.
2) Set up your legal structure
Nevadans can set up their business entities in many ways. What works for one business may not suit another because your business formation will impact how you pay taxes on earnings. Get legal help if you’re unsure about the benefits and drawbacks of each approach. You’ll register at SilverFlume, Nevada’s business portal with the Nevada Secretary of State.
Here are a few common structures you may choose:
- Sole proprietorship: This business structure means there is no difference between an owner and their business. Owners assume personal liability for business debts, so personal assets can be seized in a judgment against the business. The Secretary of State does not require sole proprietorships to file any paperwork to form in Nevada. You can use your Social Security Number to file taxes on your earnings with the Internal Revenue Service (IRS). Examples of businesses that often choose this business type are contract entertainers, photographers, and writers.
- General partnership: This structure is like a sole proprietorship for you and a co-owner. Both partners bear full responsibility for business debts and share equally in profits. Like a sole proprietorship, you do not need to register a partnership in Nevada.
- Limited Liability Company (LLC): A Nevada LLC gives owners liability protection for business debts, creating an organization that exists apart from its owner. An LLC also comes with tax options that can benefit your growth. LLCs choose to pay taxes based on personal income or pay corporate taxes. In Nevada, there are neither individual income taxes, franchise taxes, nor corporate state taxes, so your federal tax obligations will dictate the best structure for you. You’ll formalize this structure by filing Articles of Organization and paying annual filing fees. You’ll also be required to designate a registered agent with a street address in Nevada. A registered agent will be a point of contact with the state of Nevada, such as the Nevada Annual List.
- C-corporation: Corporations are owned by shareholders. Like an LLC, you’ll formalize this structure with formation documents, in this case, Articles of Incorporation. You’ll be required to designate a registered agent for your Nevada corporation. A corporation is usually the formation structure of choice for companies with investors and intending to offer shares to the public. C-corporations and S-corporations come with different tax obligations, so explore your eligibility.
You may also want to understand other choices, from limited liability partnerships to cooperative associations and nonprofits. Before formalizing your business structure, you’ll have to know how you’ll distribute profits to co-owners and shareholders.
2) Name and register your business name
Nevada may seem like the Wild West, but when it comes to choosing your business name, there are some statewide rules you’ll need to follow.
First, if you’re a sole proprietor doing business as (DBA) a name that’s not your given name, you’ll need to file a DBA with your county clerk and choose a fictitious firm name not already in use with another Nevada business. You will pay a filing fee and renew the DBA registration every five years.
LLCs and Corporations will also have some rules to remember: they’ll need to include a form of “Limited Liability Company” or “L.L.C.” in their name and abide by professional organizations’ rules about the use of industry words, from “accountant” to “collection agency” and even “college.”
Your name will also have to be available, so after brainstorming a few ideas, search for available names on the Secretary of State’s website. After registering for your LLC or corporation with the state, file your approved name with the IRS to get an Employer Identification Number (EIN) for free. An EIN allows your business to get bank accounts, build credit, and pay taxes.
Don’t forget to file with the state. Registering with the Nevada Department of taxation is the final step to getting your business official. All businesses will need to register, but you’ll want to get a Certificate of Authority if you’re planning on collecting taxes or a reseller’s license if you hold a sales tax exemption.
Congratulations! You’re a business owner.
4) Apply for licenses and permits
Before you conduct business in Nevada, you’ll have to obtain a Nevada state business license. You can file this license online through the Secretary of State’s office or in person in Carson City or Las Vegas. You’ll have to renew the license annually.
You may need additional licenses in the county and city in which you’ll do business. For instance, Clark County has licensing requirements, but so do many of its cities. Las Vegas residents will find they need a Business License from the county and a license from Las Vegas City Hall (you can apply online) if they want to do business in the city.
Finally, professional licensing requirements may also exist for your industry. These may relate to professional requirements, public health, and environmental regulations. For example, a mobile notary business would need its employees registered with the Nevada Notary Commission and issued a stamp. There are state licenses required for multiple industries, from gambling to landscape architecture to dog handlers. You’ll have to file for these professional certifications from the appropriate state agencies.
5) Choose a location
After you brainstorm some ideas about what sets your business apart, you’ll likely know whether you need a physical business location. For some companies, this step is a no-brainer. But the decision can be murkier for many companies, like a nail salon that may operate out of a home or a commercial storefront.
Consider a modest budget when exploring commercial real estate, as well as the zoning requirements in your preferred location and the costs of remodeling. A lease will be one of the most significant obligations for a startup, and few owners want to be left paying rent if their business does not succeed.
Consider your needs by asking yourself these questions:
- Will a storefront enhance my ability to market my business?
- Do I have equipment needs that require me to rent a space?
- Can I afford the space if it fails to bring in new customers?
- Is a commercial site necessary for licensing or security?
6) Open a bank account and prepare for future taxes
While a sole proprietor can use their personal bank account to handle business needs, other types of business structures will require their own business bank account. With a bank account, you can open a credit card to appeal to future investors and provide yourself a safety net during lean periods.
You should already have your EIN and be ready to plan for paying taxes. If you’re collecting sales tax, you’ll obtain a Certificate of Authority from the Nevada Tax Center, which also lets you pay business tax online. The center maintains a handy faq with videos that you can reference if you’re unsure how to make payments or file online.
If tracking expenses isn’t your strong suit, you can set your business up for success with small business accounting software or a professional accountant who can guide you through your first filings. Not only will it save you time to work on growing your business, but an accountant can save you from overpaying and help you avoid tax penalties and other expensive mistakes.
7) Purchase business insurance
Your paperwork marathon is nearing the finish line, but it’s not over yet. A final stage in protecting all the work you have done so far is obtaining small business insurance. Almost all businesses in Nevada need some type of coverage, but the specifics differ based on the type of business you own. Here are some of the coverages to get you started with small business insurance in Nevada:
- Workers’ compensation insurance: The state requires this coverage if you have one or more employees. It is made to offset the financial burden of lost wages, hospital treatment, and rehabilitation for a worker who becomes sick or injured at work.
- General liability insurance: This coverage helps protect your company if you are sued for injury or property damage. It’s primary coverage, offering peace of mind for legal expenses when an unexpected claim comes your way.
- Business interruption insurance: This coverage addresses challenges like fires or burst pipes. If you’re forced to close your business because of unforeseen circumstances, business interruption insurance can cover wages, taxes, and a temporary lease while things get back to normal.
- Business property insurance: Speaking of fire, could your business replace all the contents of your workplace without help? Business property insurance can cover a commercial building and its contents when disaster strikes.
General liability, business interruption, and business property coverages can come bundled in a Business Owner’s Policy (BOP), which takes care of the primary needs of most small business owners. You can also add extra coverages to this type of policy, such as insurance for commercial vehicles.
8) Create a marketing plan, hire employees, and more
Before you can cash in your chips on your profitable business, you’ll have to develop your marketing strategy. It’s all based on competitive advantage, so refer to your business plan and determine how you can offer more value and ultimately gain referrals from your target customers.
Your marketing plan should focus on improving your visibility with your ideal demographic. Buy your domain name, set up a website, and establish social media accounts. If you’re starting a local business, be sure to register on Google My Business and Yelp so that customers can find and review you.
When your marketing plan takes off, you’ll start hiring employees. You’ll need workers’ compensation insurance in Nevada. The Small Business Administration (SBA) in Nevada can help guide you through your first steps with small business mentoring and resources. You’ll set up accounting systems for tax withholding and think about the roles you want employees to play.
By the time you reach the end of this list, you’ll have joined the echelons of small business owners in Nevada. Moving forward with your small business in the Silver State can keep your personal coffers full, but you may have to mine more information and learn new skills than you bargained for.
Huckleberry can help you get a policy to support your journey in less time than you think. Most small businesses get a quote in 5 minutes.