How to Start a Small Business: The First 90 Days

Filing the paperwork is the easy part. It takes about ten minutes with a formation service, and roughly half a million Americans manage it every month.

The next ninety days are where businesses actually get built, or quietly stall. This page is the checklist for that stretch. If you have not filed yet, start with how to register a business, then come back.

Key takeaways

• Get your EIN first. It is free from the IRS and takes about ten minutes online.
• Open a separate bank account before your first sale. Mixing money is the fastest way to undermine the liability protection you just paid for.
• Licences are local, not just federal. Your city and county have their own requirements.
• Set aside for quarterly estimated tax from your first profitable month. Self-employment tax alone is 15.3%.
• About 79 in 100 new businesses survive year one, and 49 in 100 reach year five, per Bureau of Labor Statistics data.

Week 1

Two jobs, and both belong before you take any money.

Get an EIN

An Employer Identification Number is your business's federal tax ID. You need it for a business bank account, for payroll, and for most licence applications.

It is free from the IRS, and the online application takes well under half an hour if the responsible party has a valid Social Security number or ITIN. Apply directly at IRS.gov.

Formation services charge $50 to $99 for this. That buys you not doing it, which is a fair trade for some people and pure waste for others. If you have no SSN, the process runs by fax or mail and takes weeks, and paying somebody starts to make sense.

Single-member LLC owners sometimes skip the EIN and use their Social Security number. Get one anyway. It keeps your SSN off client paperwork and W-9 forms.

Open a business bank account

Do this before your first sale, not after.

This is the load-bearing step of the whole list, and most guides bury it. The liability protection an LLC gives you depends on the company being genuinely separate from you. Paying personal bills from the business account, or the reverse, is the most common way an owner hands a court a reason to disregard the entity and reach personal assets anyway.

What you will usually need: your filed articles of organization, your EIN letter, your operating agreement and photo ID.

One thing to expect. A new company with no trading history will often be asked for a personal guarantee on any credit line or card. Signing one is normal, but understand what it does: it puts your personal assets behind that specific debt, straight through the shield you just built.

Weeks 2 to 4

Two more, and both cover ground the filing itself does not.

Licences and permits

Requirements depend on your industry and your location, and location means more layers than people expect.

A home-based consultant in one city may need nothing. The same business two towns over may need a home occupation permit. There is no national database, so check your own city and county sites directly.

Formation services sell a licence research report for about $99 that identifies what applies at all four levels. Worth it if your business touches food, health, construction or anything regulated. Skip it if you are a freelancer working from a laptop.

Insurance

An LLC protects your personal assets from business liabilities. It does not stop somebody suing you personally for your own work, and it does not pay a claim.

Three types cover most small businesses:

• General liability. Third-party injury or property damage. Often required by commercial landlords and larger clients.
• Professional liability, also called errors and omissions. Claims that your advice or work caused a loss. Essential in consulting, design, accounting and anything advisory.
• Workers' compensation. Required in most states once you have employees, with thresholds and rules varying by state.

Clients increasingly ask for a certificate of insurance before signing. Getting quotes early avoids losing a contract to a two-week delay.

Month 2

The money admin. Cheaper to set up now than to reconstruct in April.

Bookkeeping before you need it

Set this up while the transaction volume is small enough to be boring.

The minimum that works: a separate account, software or a spreadsheet that categorises income and expenses, receipts kept digitally, and a monthly habit of reconciling. That is enough for a first tax return and for knowing whether you are actually making money.

Bookkeeping software runs $10 to $30 a month. Several formation services bundle a trial: ZenBusiness Money Pro renews at $30 a month, and LegalZoom's bookkeeping tool converts to $9.99 a month after its trial. Both auto-renew, so diarise the trial end date the day you sign up.

Understand what you will owe

Nobody withholds tax for you now. That is the single biggest financial adjustment for a first-time owner.

Self-employment tax applies to your net profit at 15.3%: 12.4% for Social Security on earnings up to $184,500 in 2026, plus 2.9% for Medicare with no ceiling (IRS). Income tax sits on top of that.

Estimated payments are generally due quarterly if you expect to owe $1,000 or more for the year. Missing them can bring penalties even if you pay in full at filing time.

One piece of good news. The 20% pass-through deduction was due to expire at the end of 2025 and was made permanent by legislation signed on 4 July 2025 (Tax Foundation). Planning advice written before mid-2025 warns about a tax cliff that no longer exists.

A practical habit: move 25% to 30% of every payment received into a separate tax account on the day it lands. Adjust once an accountant has seen a full year.

Month 3

Two dates matter, and both are set by your state rather than the IRS.

Annual report

Most states want a filing each year or every two years, usually with a fee. Miss it and the company can fall out of good standing, which in some states leads to administrative dissolution.

Registered agent renewal

The first year is often free or discounted. Year two is when the real price arrives, and it varies more than anything else in this category:

Prices read from each provider's own pages on 18 August 2026. You are not obliged to keep the agent who filed your paperwork; changing is a routine state filing.

One thing that is no longer on this list: the Beneficial Ownership Information Report. FinCEN ended that requirement for US-formed companies on 14 August 2026. See what a BOIR report is.

What the survival data actually says

Worth calibrating expectations against the real numbers rather than the folklore.

The Bureau of Labor Statistics tracks cohorts of new establishments. About 79 in 100 are still operating after one year, 49 in 100 after five years, and 34 in 100 after ten (BLS).

So the widespread claim that most businesses fail in the first year is simply wrong. Four in five make it. What the data does show is steady attrition afterwards, which is exactly when the recurring costs above start landing. Plan for year three, not for month three.

The 90-day checklist

Common questions

Do I need an EIN for a single-member LLC? Not always, but get one. It is free, takes minutes, and keeps your Social Security number off client paperwork.

Can I use my personal bank account at first? Legally you can as a sole proprietor. With an LLC it undermines the protection you formed the company to get. Open the separate account.

When do I need to start paying tax? Estimated payments are generally quarterly once you expect to owe $1,000 or more for the year. Do not wait for April.

What licence do I actually need? It depends on your industry, state, county and city. There is no single answer and no national register, so check all four levels for your own address.

Should I hire an accountant? Once profit is steady enough to consider an S corp election, yes. Before that, decent bookkeeping and a tax savings habit cover most of the value.

Still choosing a structure? See what is an LLC and LLC vs sole proprietorship. Weighing whether to start at all? The data is in starting a business. Provider comparisons are on our best LLC services chart, scored by the method in how we rank.

Federal tax figures reflect 2026 rules and provider prices were read on 18 August 2026. This content is not legal, financial or accounting advice.