Step-by-step process governs small startups

Anyone wanting to do business in Nevada as a separate entity must register with the Nevada Secretary of State, regardless of whether they are selling a product or a service, or holding real or personal property.

Attorney Ken Woloson specializes in the organization, licensing and maintenance of Nevada businesses. He outlined the process of starting a business as it concerns the state.

Whether it is a home-based business, mom-and-pop corner grocery or a multi-million dollar enterprise, it must have a state business license. If a sole proprietor with a home-based business operates a business that produces less than two-thirds of the person's annual income, he can have an exemption from having to obtain a business license. Others exempt from a license include nonprofit entities, schools, churches, government organizations, movie production companies and insurance companies.

To form a corporation (Articles of Incorporation) or to form a limited liability company (Articles of Organization), a business license application must be filed with the Secretary of State, along with a $75 filing fee.

Within the next month, an initial list fee of $125 and a business license fee of $200 are due. The initial list names the company's officers.

The state does not give the entity the right to conduct a particular type of business. That is handled by local licensing authorities such as Clark County and the cities of Las Vegas, North Las Vegas and Henderson.

If the business will be hiring employees within 12 months, it is required to register with the Employment Security Division. There is no filing fee, but the ESD will require quarterly tax payments, which depend on the number of employees, amount of payroll and type of business.

The business must then register with the Division of Taxation for a use tax permit or a sales tax permit. There is no filing fee for the use permit, which is required for any office equipment, furniture or supplies purchased from out-of-state or online where sales tax is not paid at the time of the purchase. The business is required to pay 8.1 percent sales tax on those items to the state.

The sales tax permit is for any business engaged in retail sales. The filing fee is $15, and a security deposit is required at the time of registration based on a percentage of the estimated amount of projected sales for one month. The deposit will vary greatly depending on the type of business.

For more information, visit nvsos.gov.

Contact View education reporter Jeff Mosier at jmosier@viewnews.com or 224-5524.