How to Start a Business in Georgia (Updated 2023)

Are you looking to form a business in Georgia? If so, you'll need to make sure you've taken care of all the basic tasks of starting your business. Your business starts with an idea and can evolve into a profitable company. But you'll need to first comply with Georgia's business laws and requirements.

Here are the key steps to starting your own business in Georgia.

1. Choose a Business Idea

Whether you have a business idea in mind or not, you'll need to do your research. Think about whether your business idea will be profitable in your area. Consider your competition, the demand for your goods and services, and your market reach. For more guidance, read our article on how to evaluate business ideas.

After you land on an idea, you should write up a business plan. A business plan can help you sort out:

• startup costs
• your competition, and
• strategies for making money.

Your business plan can also help you attract and persuade investors and lenders to provide financial assistance to your business.

2. Decide on a Business Legal Structure

The most common legal structures for a small business are:

• sole proprietorships
• partnerships
• limited liability companies (LLCs), and
• corporations.

Each business structure has its advantages and disadvantages. The one you choose will depend on your business's needs and priorities. For example, if you want to make sure you're personally protected from your business's debts, forming an LLC or corporation—two limited liability business structures—might make the most sense. If you want to cut down on costs and formalities, then unincorporated entities like a sole proprietorship or general partnership might be the best fit.

You have other options beyond the most common four entity types. You can form an S corporation, a special corporate tax entity. If you want limited liability in a partnership, then you can form a limited partnership. If you provide a professional service, then you have the option of forming a professional corporation in Georgia.

Check out our article for information on how to choose the best ownership structure for your business.

3. Choose a Name for Your Georgia Business

When deciding on a business name, you should choose one that's unique, marketable, and registrable. Georgia law requires LLC and corporation names to be distinguishable from other business names already on file with the Georgia Secretary of State (SOS). You can look for available names on the SOS's Corporations Division business database.

Reserving your business name: Sometimes, you have a business name but you're not ready to file your business formation paperwork. You can reserve an available name for 30 days by filing a name reservation request with the SOS either online through the eCorp website or on paper with a Name Reservation Request form. There are certain name requirements for LLCs and corporations (like including a word such as "LLC" for LLCs or "company" for corporations). See our articles on how to form an LLC in Georgia for more information.

Filing a DBA with the county clerk: If you're doing business under a name that's different from your legal name, then you must register that name—called a "DBA"—with your county's Clerk of the Superior Court. For sole proprietors and partnerships, your legal name is the name of the owner(s). For corporations, LLCs, and other incorporated businesses, your legal name is the name you filed with the SOS when you formed your business. Georgia also requires you to publish notice of your DBA in a local newspaper. (Ga. Code § 10-1-490 (2023).) Check your local superior court website for more information.

If you plan on doing business online, you might want to register your business name as a domain name. In addition, to avoid trademark infringement issues, you should do a federal and state trademark search to make sure the name you want to use isn't the same as or too similar to a name already in use.

Check out our section on business names for tips on how to pick the right name for your business.

4. Register Your Business Entity With Georgia Secretary of State

The form you file to register your business with the SOS depends on your business structure. Some business structures like sole proprietorships and general partnerships are unincorporated entities and don't require formation paperwork.

• Sole proprietorship: You don't need to file any organizational documents with the state to create a sole proprietorship in Georgia. You form a sole proprietorship as soon as you start selling goods or performing services on your own. If you don't want to be a sole proprietor, then you can file paperwork to become a single-member LLC—the same paperwork you'd file to form a multi-member LLC.
• General partnership: As with a sole proprietorship, you don't need to file any paperwork to create a general partnership in Georgia. You form a partnership by simply starting to do business with at least one other person or company. If you decide to create a partnership, you should have a written partnership agreement that sets out how the business will be run and the profits and liabilities divided. The partnership agreement can be very helpful if there's ever a dispute among the partners.
• Limited partnership: If you want limited liability protections for your partnership, you can register a limited partnership in Georgia. You'll need to complete a certificate of limited partnership and file it either online, by mail, or in person with the SOS.
• LLC: To form an LLC in Georgia, you must file articles of organization with the SOS. You'll also need to appoint a registered agent in Georgia for your LLC for service of process. In addition, while not required by law, you also should prepare an operating agreement to establish the basic rules about how your LLC will operate. The operating agreement isn't filed with the state.
• Corporation: To create a corporation in Georgia, you must file articles of incorporation with the SOS. Although not legally required, you also should prepare bylaws to establish your corporation's internal operating rules. As is the case with operating agreements, bylaws aren't filed with the state.
• Professional corporation: Some licensed professionals can choose to form a professional corporation. If you want to file a professional corporation, then you simply file articles of incorporation that include special language. You can learn more in the corporation filing procedures document provided by the SOS.
• S corporation: An S corporation is a tax entity that's elected after you form a corporation or other eligible business entity. After you form your corporation or other applicable business with the SOS, you can file IRS Form 2553, Election by a Small Business Corporation, with the IRS to elect S corporation tax status.

You can find some filing templates and transmittal forms on the Georgia business forms section of the SOS website. You can also find filing procedures for corporations, LLCs, and limited partnerships. These procedures guide you through the filing process for each business entity.

You can register your business online through the eCorp website or by delivering the appropriate paperwork by mail or in person.

5. Apply for Georgia Licenses and Permits

Almost all businesses will need to apply for at least one license, permit, or registration. You can find more detailed information in our article on Georgia business licenses.

Tax registration. If you'll be selling goods in Georgia, you must register with the Department of Revenue (DOR) to collect sales tax. If your businesses will have employees, you must register with the DOR for employer withholding taxes. You can register online for both types of tax, as well as other business taxes, by going to the Georgia Tax Center (GTC).

Employer identification number (EIN). If your business has employees or is taxed separately from you, you must obtain an EIN from the IRS. Even if you're not required to get an EIN, there are often business reasons for doing so. For instance, banks often require an EIN to open an account in the business's name and other companies you do business with could require an EIN to process payments. You can get an EIN by completing an online application on the IRS website. There's no filing fee.

Regulatory licenses and permits. You might need to apply for a special license or permit that covers areas such as:

• health and safety
• the environment
• building and construction; and
• specific industries or services.

Check the SOS's First Stop Business Guide for information and instruction on professional licensing, industry-specific licensing, tax registration, employer requirements, and other topics. For information about local licenses and permits, such as business tax certificates, check the websites for any cities or counties where you'll do business

Professional and occupational licenses. These cover people who work in various fields. The Professional Licensing Boards Division of the SOS has links to information about most state-licensed occupations and professions, including an online licensing application system.

6. Pick a Business Location and Check Zoning Regulations

You'll need to pick a location for your business and check local zoning regulations. Consider the needs of your customers, and whether you have the kind of business that could benefit from foot or highway traffic.

Before you commit to a location, take time to calculate the costs of running your business in the desired spot, including rent and utilities. Refer back to your business plan to evaluate whether you can afford your desired location during your company's early months. If you lease a commercial space, make sure you negotiate terms that'll work for your business in the long term.

It's important to verify that the spot is zoned for your type of business. You might find zoning regulations for your town or city by reviewing your local ordinances and contacting your town's zoning or planning department.

One alternative to opening your business at a new location is running your company out of your home. If you decide to run a home-based business, again check your local zoning laws. You should also review your lease (if you rent your home) and homeowners association rules (if applicable)—either of which might ban some or all home businesses.

7. Register and Report Business Taxes

You must file and pay taxes with the DOR according to your business and tax structure. You can register your business and file taxes online through the GTC.

See our article on Georgia business income tax for more information on state business taxes in Georgia.

Sole proprietorships: Pay state taxes on business income as part of their personal state income tax returns (Form 500).

Partnerships: Partners pay state taxes on partnership income on personal tax returns. In addition, Georgia partnerships also must file Form 700, Partnership Tax Return.

LLCs: Members pay state taxes on their share of LLC income on personal tax returns. In addition, LLCs themselves have to file an additional state tax form—either a partnership return or a corporation return. The specific form used will depend on how the LLC is classified for federal tax purposes. Georgia LLCs also are required to file an annual registration and fee with the Georgia SOS. See our article on Georgia LLC annual report and tax filing requirements for more information.

Corporations: Shareholders must pay state taxes on their dividends from the corporation. A shareholder-employee with a salary also must pay state income tax on their personal state tax return. Moreover, the corporation itself is subject to Georgia corporation taxes. And, finally, corporations must file an annual registration and fee with the Georgia SOS.

If you have employees, you must also deal with state employer taxes. The DOR has an employer's tax guide you can review to learn more.

And, apart from Georgia taxes, there are always federal income taxes. Check IRS Publications 334, Tax Guide for Small Business, and 583, Taxpayers Starting a Business.

8. Obtain Insurance for Your Georgia Business

Business insurance can protect your business and your personal assets from unexpected events, such as personal injury lawsuits and natural catastrophes. An insurance agent can help you explore the different coverage options for your business. You should consider getting general liability insurance to protect your business against claims relating to bodily injury or property damage. Your business might also benefit from cyber liability insurance to cover litigation and settlement fees following a data security breach.

For more, see our article on what types of insurance your small business needs.

9. Open a Business Bank Account

No matter the type of business you form, you should consider opening a separate business account to make it easier to track your income and expenses. For some business types, including LLCs and corporations, a separate bank account is necessary to maintain your liability protection.

Additional Help With Starting Your Georgia Business

The Georgia state website provides a starting a business guide for entrepreneurs. This guide expands on the basic steps to forming your Georgia business, including registering with the SOS and DOR, applying for licenses and permits, and getting funding.

The DOR has a step-by-step guide for small business owners looking to register a business in Georgia. You can find guidance on what information you need to gather during the startup process and the departments and agencies you need to register with. The guide also has links to important resources. In addition, the Georgia Department of Economic Development has a small business startup information webpage with links to in-depth guidance on getting your business off the ground.

If you need additional help or you have legal questions, consider speaking with a Georgia business attorney. They can help you decide on the best business structure and walk you through the setup process.