Set up finances

From the standpoint of the government, you are now ready to run your business! Before you start any operations, though, you should open a business bank account. Not only does using your personal bank account make bookkeeping and taxes a nightmare, it risks your losing the limit on personal liability a corporation or LLC gives you. So open a bank account as soon as you have finished registering your business.

If you don't need a branch, we recommend the online bank BlueVine, as it has a great website and no fees except for outgoing wire transfers and cash deposits. If you need to deposit cash regularly, most traditional banks are pretty mediocre in terms of their fees, websites, and customer service; you might consider a local bank or credit union, where you'll be more likely to get good customer service, but make sure to shop around and ask for a full list of fees.

You'll also need to keep track of and categorize your income and expenses, both so you can file your taxes, and so you can understand your business's finances. Bookkeeping tools help you do this, and we'd recommend you use FreshBooks: it is easy to get started with, and also has more advanced features that your business may grow to need. We'd recommend you set up an account with FreshBooks soon after you open your bank account and do your books at least monthly, as it's much easier to do as you go than try to figure out months later (not to mention you'll need the information regularly for taxes).

While Freshbooks makes it easy to do your own bookkeeping, you need an accountant to review your books and file your taxes. Pick out an accountant as soon as possible and well before you file your first taxes, as they can help you decide what accounting method to use, which will impact your tax payments. Your best bet is usually to find a local accountant—ask colleagues and other local sources for referrals, and talk with a few of your options (and ask their fees!).

Assuming you have taken an S election, you are required to pay yourself a reasonable salary. When you're ready to pay yourself or any other employee, we recommend you use a payroll service. For most businesses, payroll taxes are too complicated to be worth your time, and there are affordable services that will handle payroll for you. We recommend Gusto, which will take care of your payroll, benefits, workers' compensation, and HR compliance.

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