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How to Start A Remote Business 101

Michele Eilertsen
,
VPM Staff
Last Updated
August 25, 2021

Running a remote business can save you valuable time, money, and resources, allowing you to prioritize the things that matter most to your business.

At this stage, you’re ready to open your online clothing store (whether on Amazon, Shopify or another e-commerce platform) and start selling your products. However, there are a couple of things you’ll need to do before you can officially get the ball rolling.

In this article, you’ll learn what steps you need to take to start your remote business.

Step 1: Register Your LLC

The first thing you’ll want to do is register your LLC. An LLC, which stands for Limited Liability Company, is a type of entity that creates a barrier between your personal assets and business in the event of a lawsuit.

This means that if you are sued, the court can only go after your business. Personal assets like your home, car, or savings are off limits. LLCs are ideal for remote businesses because they are easy to form and maintain, and limit your personal liability (i.e. protection).

Registering your LLC is a must, but before you’re able to do so, you’ll need to make sure you’ve checked the following steps off your to-do list.

Step 2: Choose Your Business Name

If you don’t already have one, now is a good time to narrow down what you’d like to name your remote business. Feeling stuck? Here are a couple of tips to help you devise the perfect name for your new LLC:

  • Be original! The more unique your business name is, the more memorable it will be to potential customers. This can also help you stand out against your competitors.
  • Make sure it’s relevant. Your LLC’s name should speak to your industry. When people read it, you want them to have some idea of what your business has to offer.
  • It should be easy to say and read. Customer referrals can make a huge difference for your remote business, so the less complicated your name is, the better.
  • Whatever you do, avoid acronyms (like CVS or BMW) at all costs. If you want to shorten your business name, reducing it to a condensed version (i.e. Pepsi-Cola rebranding as Pepsi) will make a much bigger impact.

Let’s give an example:

A good LLC name would be Dog Lovers T-Shirts LLC. It’s unique, it’s relevant, and it tells customers exactly what you are selling.

A bad LLC name might be something like Shop T-shirts LLC. Though relevant, this one is generic, unoriginal and in general, pretty forgettable.

You’ll also need to ensure your name complies with state laws, which generally include:

  • Using the phrase “Limited Liability Company” or one of its abbreviations (LLC)
  • Not including words that might confuse your LLC with a government agency (FBI, Treasury, etc.)
  • Making sure your name is available

Pro-tip: If you are planning on building a digital presence for your remote business, you’ll want to make sure your potential name is available as a web domain (URL) for brand consistency. For example: http://www.dogloverstshirts.com.

Step 3: Get a Virtual Business Address

Selecting the proper business address to use for your LLC may not seem like a big deal, but it’s important to know what your options are and how each one can benefit you.

Listing your home address is a popular choice because it's free and easy, but with that comes one major issue: privacy. Since your business address will be listed on public records and displayed on Google, using your home address is not advisable. No one wants to be harassed (or worse, stalked) by an angry customer!

You’re probably wondering if a PO Box will work. Unfortunately, the answer is no. PO Boxes are not an acceptable form of address when registering an LLC, so you can skip the hassle of acquiring one.

Fortunately, there’s a better solution to protecting your privacy while running your remote business: a virtual mailbox.

What is a virtual mailbox?

A virtual mailbox allows you to manage your mail and packages online from anywhere, at any time (kind of like email).

Your unopened envelopes will be scanned so you can view your mail online at your convenience. Then, you can decide whether to have the mail opened, forwarded or destroyed.

Virtual mailboxes offer several benefits, including:

  • A permanent U.S. business address, so you can say goodbye to updating paperwork when you move
  • Privacy protection - rather than using your home address for business paperwork, you can use your mailing address instead.
  • Digital record keeping, which makes accessing your information easy and stress-free.

And since your new commercial address will be based in a prestigious location, it can also help boost your business image. Score!

How do I get a virtual mailbox?

You can get a virtual mailbox with VirtualPostMail (VPM) as soon as today!

Just pick a plan, fill out the USPS 1583 Form and mail (or email) it back to us with proper identification attached. Once you’re signed up, you can submit a Change of Address Request to have your mail forwarded to your new business address (i.e virtual mailbox). Voila!

Step 4: Select a Registered Agent

Every LLC must have a registered agent in the state they are currently conducting business in. Since it’s a legal requirement, you won’t be able to register your LLC without one.

Operating without a registered agent can lead to some pretty serious repercussions for your business, including (but not limited to) hefty fines, increased personal liability risks, the loss of your “good standing” status, and potentially even having your business shut down.

Now that you know how important it is to have a registered agent, let’s dive into the details so you can decide who to designate as yours.

What is a registered agent?

A registered agent is an individual or entity who will receive legal and other important documents on behalf of your business.

In order to be a registered agent, a specific set of criteria must be met. Though these will vary from state-to-state, most states include some variation of the following requirements:

  • Must be a resident of the state in which business is being conducted
  • Must have a physical residence where service of process can be delivered and accepted - PO Boxes are not permissible
  • Must be available to accept service of process and receive official documents during normal business hours (Monday through Friday, 8:00AM-5:00PM)

It’s helpful to research the rules and regulations for the state you plan to conduct business in if you are planning to be your own registered agent.

What are my registered agent options?

When it comes to selecting a registered agent for your remote business, your options are:

  • Choosing to be your own registered agent. Being your own registered agent may seem like an ideal and cost-efficient option, but this requires your name and home address to be listed as public information. This ultimately creates a huge privacy invasion for you. Plus, you have to be comfortable with compliance processes and being available during business hours Monday through Friday. That means no traveling to meet with clients or lengthy vacations!
  • Using a registered agent service. With this option, you’ll never have to worry about maintaining compliance, being available around-the-clock to accept time-sensitive documents, or your home address being broadcasted to the public. The service takes care of everything for you!

Both options come with their own set of benefits and disadvantages, but we highly recommend using a registered agent service for privacy, flexibility, and peace of mind.

How do I get a registered agent?

VPM offers a FREE registered agent with supported virtual mailbox plans, saving you $100 (or more!) a year. To get your registered agent, simply choose one of VPM’s supported plans, pick a mailbox number, and finish the sign-up process. Then, you’re in!

Step 5: File Your Articles of Organization

You’ll also need to file your Articles of Organization. Think of this as your business’s birth certificate. It outlines key details of your LLC, including the company’s name, members, business address, and registered agent.

What are Articles of Organization?

Articles of Organization are documents that confirm your LLC’s existence and help prevent any potential disputes between members in regard to duties, rights, and protection of personal assets. Their purpose is to legalize your business; once filed, your LLC will receive approval to operate.

Many states require these to be filed before you can apply for an Employee Identification Number (EIN), open a business bank account, and/or take out a business loan.

How do I file my Articles of Organization?

To get started filing your Articles of Organization, you’ll want to:

  1. Visit the Secretary of State website to learn about the state-specific rules for filing your Articles of Organization.
  2. Once there, you can find and download the appropriate form.
  3. You’ll be asked to supply basic information about yourself and your business, and you will need to confirm the name and address of your Registered Agent.
  4. Depending on which state you’re in (the form should contain instructions on how to proceed), you can either file your documents online or mail a physical copy in. You’ll be asked to pay a one-time filing fee.

Once these are completed and filed, you can move on to the final step in registering your LLC.

Step 6: Apply for an EIN

An Employee Identification Number (EIN) is a unique, nine-digit number required to register your business as an LLC. It’s essentially a social security number for your business and is used for tax identification purposes.

How do I get an EIN?

There are a few ways to obtain an EIN, but the quickest (and easiest) way for you to do so is by applying for one online. Keep in mind, you can only apply online if you have a SSN or ITIN. Otherwise, you’ll have to fill out the SS-4 form and mail (or fax) it in if you don’t have an SSN or ITIN.

You’ll find the detailed steps to apply for an EIN (including how to apply by phone, mail or fax) on our GoRemote blog.

Pro-tip: If you come across a website that asks you to pay for an EIN, it’s a scam.

Step 7: Prepare an Operating Agreement

An operating agreement sets up the organization for how your company is run. While it’s not a requirement in most states, it’s highly recommended that every remote business has one (it’s basically a blueprint for your business).

Operating agreements typically outline rules and regulations regarding ownership and structure, including but not limited to, financial details and other procedures that are to be followed within the company.

For example, if a disagreement were to arise between individuals in your company regarding the responsibilities of a specific member, you can refer to your operating agreement for guidance.

How to create your operating agreement

A typical operating agreement for an LLC will include the following basic provisions:

  • Identification (like the name of your LLC and business address)
  • Statement of Intent
  • Business Purpose
  • Identification of Members (including names, addresses, titles, and duties)
  • Distribution of Profits and Losses
  • Capital Contributions
  • Management (specifically, details about how managers are selected, how long they’ll serve, how much they’ll be paid, etc.)

Though it is not necessary to formally file this type of agreement in most states (with the exception of California, Delaware, Maine, Missouri and New York), it should be placed in your internal company records for safekeeping.

Your operating agreement will inevitably change as your business evolves. It’s important to keep ALL of your information updated, including changes in your business address or registered agent.

Pro-tip: Using a company like Rocket Lawyer to create your operating agreement can make the process quicker and easier. (Note: This is not legal advice. We encourage you to seek legal counsel if needed.)

Step 8: Open a Business Bank Account

After you finish forming your LLC, your next step is to open a business bank account. While this isn’t a necessity, it’s highly recommended that you open one as soon as possible.

Why do I need a business bank account?

A business bank account is important because it can help you separate your business and personal funds. Without the separation, courts can go after your personal assets (including your savings) in the event of a lawsuit.

It will also allow you to keep track of business expenses, simplify tax reporting, deposit payments under your company name, and set up credit card payments.

What do I need in order to open a business bank account?

Required documentation will vary from state-to-state, but in general, here’s what you’ll need in order to get started:

  • A copy of your LLC’s Articles of Organization to prove that your business is legally registered with the state
  • A copy of your LLC Operating Agreement to ensure you are authorized to open bank accounts on behalf of your business
  • Your Employee Identification Number (EIN) for tax purposes
  • A mailing address where all of your statements, documents and other mail will be sent
  • A valid ID belonging to the company owner
  • A physical business address based in the U.S. that will be listed as your business’ operating address - you cannot use a PO Box for this. Some banks may require you to supply additional proof of address.

How do I obtain proof of address?

If your bank is requiring additional verification to prove that you occupy or own the space, you can use one of the following as proof of address:

It’s important to note that the address on the type of verification you provide must match your physical business address.

Step 9: Maintain Your Annual Reports

Congratulations on forming your LLC! Now that the tedious part is over with, you’ll need to make sure you are maintaining your annual reports in order to stay compliant on a yearly basis. In these reports, you’ll specify information like your LLC’s name and address, the name and address of your registered agent, and details of the services you offer.

Most states allow you to file your annual reports on the state website, though some require you to mail a hard copy in. Regardless of how you file, you will also need to pay the yearly associated fees.

Why do I need to maintain annual reports?

The biggest reason you’ll need to maintain annual reports is compliance. Failing to report any changes within your business can result in harsh consequences, including fees, penalties, the loss of your “good standing” status, and potentially even forfeiture of your business.

Pro-tip: Set a Google Calendar reminder on the date your annual report is due.

Conclusion

In conclusion, starting your remote business is not as difficult as you might think. In order to register your LLC, you’ll need to first select a name that is unique to your business. This will discern your remote business from competitors.

Then, you’ll choose a business address that can provide you with privacy and peace of mind. You’ll need to find a registered agent to help you maintain compliance (offered FREE of charge with select VPM virtual mailbox plans) and apply for an Employee Identification Number (EIN) to be used for tax purposes.

Finally, you’ll want to file your Articles of Organization and prepare an operating agreement. While somewhat monotonous, these components are necessary to register your LLC. Once completed and filed, your last steps will be to open a business bank account and make sure you are maintaining your annual reports.

If you’ve been looking for a sign to get your remote business up and running, THIS IS IT.

There’s a popular Chinese proverb that states, “The best time to plant a tree was 20 years ago. The second best time is now.” Plant your seeds now, and you’ll be thanking yourself before you know it.

Don’t have a registered agent yet? Did you know you need it to stay operate your LLC?

VirtualPostMail offers a registered agent included at no charge with select plans. Save over $100 a year compared to using a dedicated registered agent service.

https://www.virtualpostmail.com/
Michele is an experienced writer of 5 years. Her expertise is in creating content that helps small businesses solve big problems.