Last updated: October 4, 2026
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Forming your business does not have to cost much more than your state filing fee. This guide walks you through six steps: setting up a business address and phone number, choosing and filing your business structure, getting a free EIN, creating your governing documents, opening a business bank account and starting your business credit file.
Establish a business address and phone number.
First, decide where you will do business and how people will contact you. Your business address can be your home address, so you do not need office space yet. If you want to keep business mail separate, a virtual mailbox or a private mailbox service works. A separate business phone number also helps keep business and personal calls apart. Google Voice offers a free number for personal use, and paid business phone plans are available from providers such as Google Voice and Nextiva.
Incorporate your business.
Next, form your business as a legal entity. There are several structures, each with pros and cons. The most common are sole proprietorships, partnerships, limited liability companies (LLCs) and corporations. If you would rather not file yourself, Bizee (formerly Incfile) advertises LLC formation for $0 plus your state fee.
- Sole proprietorships are the most common type of small business, and many rideshare drivers and barbers operate as sole proprietors. A sole proprietorship needs no state formation filing, but it also gives you no liability protection.
- Partnerships are an option when your business has more than one owner. In a general partnership, every partner is liable for the business debts. In a limited partnership, at least one general partner has unlimited liability, while limited partners liability is generally capped at their investment. In a limited liability partnership, partners generally have limited liability, though which professions may form one varies by state.
- Corporations are taxed as C corporations by default, and eligible corporations can elect S corporation status with the IRS. Some states also allow benefit corporations (B corps).
- LLCs give owners liability protection like a corporation, with fewer formalities and pass-through taxation by default.
To choose, ask yourself two questions: how risky is my business, and how do I want to be taxed? Then check with your state and local governments for the licenses your business needs.
Get an employer identification number (EIN)
You will need an Employer Identification Number, or EIN. It works like a Social Security number for your business, and the IRS uses it to track your business for tax purposes. Corporations need one, and so do LLCs with employees or more than one member; banks also usually ask for one when you open a business account. An EIN is free, and you can apply online at IRS.gov.
Create your governing documents
Your business needs to create an Operating Agreement or Corporate ByLaws. They serve as formal guidelines for how your company will handle disputes, ownership percentages, losses, and profits.
These documents are essential for your company or corporation that has two or more owners. Be sure to sit down with your fellow co-owners to clarify what your organization’s bylaws or operating agreement contain. You can create these documents with your attorney or get started with this free operating agreement template.
Pro tip: if you need other legal documents, such as a bill of sale or a lease agreement, template services can help, but have an attorney review anything important.
Open a business banking account.
Now that you have your EIN and Articles of Incorporation, let’s open up your Business Banking Account. It is essential to separate your personal finances from your business finances. When tax season comes around, you will have a record of all revenue and expenses. Keeping track of your payments will help you obtain valuable tax write-offs.
Do your research when selecting a Bank that is going to meet all of your banking needs.
Novo is one option: an online business checking account that connects with tools such as QuickBooks and Stripe. Compare fees and features with your local bank or credit union before you choose.
Apply for a business DUNS number.
Start building your business credit by applying for your DUNS number or D-U-N-S, a proprietary system developed and managed by Dun & Bradstreet (D&B) that assigns a unique numeric identifier, referred to as a “DUNS number” to a single business entity. Dun & Bradstreet is the gold standard when it comes to business credit. Most companies look at a business’ DUNS number to verify business credit and legitimacy. You can easily apply for a DUNS number online by clicking here.
Pro tip: keep your business information up to date with the business credit bureaus, and check your business credit regularly. Services such as Nav show you your business credit in one place.
Conclusion
There is no way to incorporate completely free, because every state charges a filing fee. But by doing these steps yourself, you can keep your costs close to that fee, and you can start today.
Disclaimer: The information in this article is for educational purposes only and does not constitute legal, tax, or financial advice. Business formation rules, fees, and deadlines vary by state and change often. Always consult a qualified attorney, CPA, or tax professional before making decisions about your business.
