The Business Formation Checklist Every New Owner Should Review

Starting a new business is an exciting venture filled with possibilities, but it also comes with a long list of legal and strategic decisions that can significantly influence your future success. From choosing the right entity type to registering your business and setting up contracts, the early steps you take can either protect or jeopardize your investment.

Many first-time entrepreneurs underestimate the intricacies of forming a new business. It’s not just about a name and an idea—there are legal structures, tax considerations, liability risks, and compliance obligations to sort through. Skipping important steps or relying on one-size-fits-all templates can create major complications down the line.

At the Law Office of Justin S. Eppler, LLC, we help entrepreneurs in Anchorage, Alaska, build a solid foundation for their ventures. As a seasoned business formation attorney, our attorney offers tailored legal support to make sure your business starts off on the right foot, with all the necessary protections and documentation in place.

Choosing the Right Business Structure

One of the first and most critical decisions you’ll make is selecting the legal structure for your business. This choice affects your personal liability, taxation, and administrative responsibilities.

Common Business Entities

Here's an overview of the most common types of business entities and their key characteristics:

• Sole proprietorship: Simplest structure with minimal paperwork. However, it offers no liability protection.

• Partnership: Suitable for businesses with two or more owners. General partnerships don’t protect personal assets from business debts.

• Limited liability company (LLC): Offers liability protection and pass-through taxation. Flexible and popular for small to mid-sized businesses.

• Corporation (C-Corp or S-Corp): More intricate structure, often preferred by businesses planning to raise capital or go public. Offers strong liability protection but comes with stricter compliance and potential double taxation.

Each option has advantages and trade-offs. A business formation attorney can help you weigh your goals against legal and financial considerations to choose the best fit.

Registering Your Business With the State

Once you’ve chosen a structure, you must register your business with the Alaska Division of Corporations, Business and Professional Licensing. This includes:

• Filing the appropriate formation documents (e.g., Articles of Organization for an LLC)

• Paying filing fees

• Applying for an Alaska business license

• Securing local municipal licenses or permits as needed

If you plan to operate under a name different from your legal entity name, you’ll also need to file a DBA (Doing Business As).

Obtaining Federal and State Tax IDs

Nearly all businesses need an Employer Identification Number (EIN), even if they don’t have employees. This number is used for tax filings, opening bank accounts, and applying for credit.

In Alaska, businesses may also be required to:

• Register for state taxes (depending on the type of business and location)

• Obtain a state sales tax permit if operating in a municipality that levies sales tax

A business formation attorney makes sure that you’ve met all tax registration requirements relevant to your business type.

Creating a Clear Operating Agreement or Bylaws

An Operating Agreement (for LLCs) or Bylaws (for corporations) is essential—even if not legally required. These documents clarify how the business will be run, including roles, responsibilities, voting rights, dispute resolution, and procedures for adding or removing members.

Without these foundational documents, internal conflicts can lead to costly legal battles. In some cases, default state laws may dictate decisions in the absence of a formal agreement.

Opening a Business Bank Account and Separating Finances

Maintaining a clear line between personal and business finances protects your limited liability status and simplifies your bookkeeping.

You’ll need:

• A business bank account in your company’s name

• A business credit card or line of credit

• Accurate recordkeeping systems for expenses, invoices, and payroll

Co-mingling personal and business funds can result in “piercing the corporate veil,” which exposes your personal assets to business liabilities.

Acquiring Necessary Licenses and Permits

Depending on your industry and location, you may need one or more licenses or permits to operate legally. Common examples include:

• Health permits (for food services)

• Zoning permits

• Professional licenses (e.g., for attorneys, contractors, or cosmetologists)

• Federal licenses (e.g., for firearms sales or interstate trucking)

Failing to comply with local, state, or federal regulations can result in fines or business closure. A business formation attorney helps identify the full scope of compliance requirements.

Protecting Intellectual Property

Your business name, logo, slogan, and other original materials may qualify for intellectual property protection. You can safeguard your brand identity by:

• Registering trademarks: Protects logos, names, and brand elements on a national level.

• Securing copyrights: Protects written, visual, or digital content from unauthorized use.

• Drafting NDAs and IP clauses: Prevents employees, partners, or contractors from misusing proprietary information.

Protecting intellectual property early allows you to retain control over your ideas and reputation.

Drafting Key Contracts and Agreements

Well-drafted contracts help avoid misunderstandings and protect your legal rights. Every new business should have a suite of foundational agreements in place, including:

• Client or customer contracts

• Vendor and supplier agreements

• Employment or independent contractor agreements

• Non-disclosure agreements (NDAs)

A business formation attorney assures you that these contracts are customized to your needs and compliant with Alaska law.

Reviewing Insurance Coverage Options

Insurance is essential for shielding your business from unforeseen risks. Some common types of coverage include:

• General liability insurance: Covers accidents, injuries, and property damage.

• Professional liability insurance: Protects against claims of negligence or errors (especially for service-based businesses).

• Commercial property insurance: Covers loss or damage to business property.

• Workers’ compensation: Required in Alaska if you have employees.

Tailoring your insurance package to your industry and risk profile can be a critical safeguard.

Staying Compliant With Ongoing Requirements

Forming your business is only the beginning. Ongoing compliance helps you maintain good standing and avoid penalties. Regular obligations may include:

• Filing biennial reports with the State of Alaska

• Renewing your business license annually

• Updating corporate records and minutes

• Maintaining up-to-date tax filings

A business formation attorney can help set up a compliance calendar to make sure that no important dates are missed.

Your Business Formation Checklist

Starting off on the adventure of starting a new business is both thrilling and full of challenges. With the right planning and focus, you can set yourself up for success. By following a structured approach and checking off essential steps, you’ll build a strong foundation for your venture.

Here’s a helpful checklist of vital actions every new business owner should take to secure compliance and pave the way for a bright future:

1. Choose a business structure

2. Register with the state

3. Obtain an EIN and tax IDs

4. Draft operating agreements or bylaws

5. Open business bank accounts

6. Acquire necessary licenses and permits

7. Protect intellectual property

8. Draft foundational contracts

9. Secure appropriate insurance

10. Set up systems for ongoing compliance

By diligently following this checklist, you'll be well-equipped to handle the difficulties of business formation and set the stage for long-term success.

Let Us Help You Launch With Confidence

At the Law Office of Justin S. Eppler, LLC, we understand how much effort and vision go into starting a business, and how critical it is to lay a legally sound foundation. As your trusted business formation attorney in Anchorage, Alaska, we offer the legal guidance and support you need to build with confidence. Reach out today and secure the future of your business.