New business
New business formation checklist
A new business needs more than an articles of organization. The entity type, the tax election, the EIN, the state registrations and the bank account all have to agree before the first transaction is booked. This checklist covers what to collect when a client forms a business, so the first-year return does not start with a cleanup.
Who sends itSent by the firm to a client who is forming a new business or has just formed one, before the first bookkeeping or tax engagement begins.
0 of 26 ticked
01Entity and ownership
02Tax registrations and elections
03Banking and books
04Contracts, insurance and compliance
05First-year planning
What firms get wrong
- Forming the LLC but never confirming how it will be taxed, which leaves the first return with the wrong form.
- Electing S corporation status after the deadline and assuming the IRS will accept a late election.
- Opening a personal bank account for business transactions, which makes the first year of bookkeeping a reconstruction.
- Missing the state sales tax or payroll registration before the first sale or first hire.
- Starting payroll before the S corporation election is accepted, which can change the owner's wage treatment.
Get this checklist when it changes
We'll email you when this checklist changes, and about once a month with new checklists and templates. Unsubscribe any time. Privacy
Questions about this checklist
Should a new business be an LLC or an S corporation?
The choice depends on the owners, the expected profit, the payroll plan and the state's fees. An LLC is usually simpler to form; an S corporation can reduce self-employment tax but adds payroll and compliance work. The firm should model both before the client elects.
Does a new business need an EIN?
A business generally needs an EIN if it has employees, files a partnership or corporate return, or needs a bank account in the business name. A sole proprietor with no employees may use a Social Security number, but an EIN is often cleaner.
When can a client elect S corporation status?
Form 2553 is generally due by the 15th day of the third month of the tax year the election should take effect. A late election may be allowed with reasonable cause. The firm should check the deadline before the client starts payroll.
What is the first tax return for a new business?
It depends on the entity. A sole proprietor files Schedule C with Form 1040, a partnership files Form 1065, an S corporation files Form 1120-S and a C corporation files Form 1120. The first return covers the tax year, not the formation date.
Does a new business need to register for sales tax?
A business generally needs a sales tax permit if it sells taxable goods or services in a state where it has nexus. The rules differ by state, so check the state where the business operates before the first sale.
Sources
Checked November 3, 2026. Tax rules, forms and thresholds change; confirm them with the IRS or your tax software before relying on them.
Ready to stop chasing?
Start free trialChecklist from usual.so · https://usual.so/checklists/new-business-formation-checklist/