Select a question from our constantly growing bank of Frequently Asked Questions. If you can't find the answer to your question here, feel free to Contact Us and we help you find the information you need, or put you in contact with someone that can.
How do I get a federal Employer Identification Number (EIN)?
One good way is to go to the IRS website at www.irs.gov. On the left side under contents, click on "Businesses". In the gray column on the left of the page you will find a Topics area; click on "Employer ID Numbers". Then click on "How to Apply for an EIN". You can also read about related topics on this website.
Also note that on February 27, 2003, SBA announced the launch of a new web-based system that enables SBA customers to register their business at the state level and to apply for and receive their Federal Employer Identification Number (FEIN) at the same time, thereby saving time and money, and reducing the paperwork burden on the small business owner. In the first week following its launch on BusinessLaw.gov, which receives approximately 250,000 hits per week, 694 businesses used this new E-Government service to obtain an FEIN number. For more information on this new system, please visit www.businesslaw.gov.
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Where can I learn more about incorporating an Iowa small business?
A good place is the Secretary of State's website at: www.sos.state.ia.us. On the left side, click on "Business Center", then click on "Choosing a Business Organization in Iowa." You will be presented with a list of options. Familiarize yourself with the options. It is possible to form a corporation without the assistance of an attorney, but not particularly wise. There are many different tax and legal implications to each choice and we strongly recommend you get professional assistance for these decisions. Also, because there are many other issues to consider before starting a business, think about calling your nearest SBDC Office for free and confidential help.
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What permits or applications do I need to start a business?
The forms (licensing, permits and registrations) that you need to file are very dependent on two issues: What type of business ownership format you choose (sole proprietorship, LLC, Corporation); and What type of business you are forming. To start a retail business in Iowa, one needs to obtain a sales tax permit. If your business will have employees and pay wages you will need an Employer Identification Number (EIN) and an Iowa Withholding Tax Registration. The EIN is also required if you will operate your business as a partnership, corporation or limited liability company (LLC). Certain types of businesses need other permits. For instance, restaurants need food licenses and alcohol beverage serving permits. In order to determine whether your business needs any permits, contact your nearest Small Business Development Center. You can find your local center in the Regional Centers section of this website.
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Do I need a special license to operate a business?
Generally, when your business is regulated by an Iowa licensing board or authority, you will need to acquire a license to conduct business in Iowa. Most retail businesses will only need a sales tax permit. Professional services and food businesses, restaurants, grocery stores, and bars all need special permits and licenses to conduct business. Any business having employees will need an Employer Identification Number and an Iowa withholding registration. Each type of business and form of business entity have unique requirements. We would recommend a visit to your nearest Small Business Development Center to have your specific concerns answered. You can find the SBDC nearest you on this website by going to Regional Centers.
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Do I need a sales tax permit? How do I get one?
A retail business needs a sales tax permit if you are selling products or services that have been specified taxable by Iowa law. A business will need to complete and file an Iowa Business Tax Registration form. These forms are available at all SBDC offices as well as accounting offices. When completed, there are three ways to file: by mail, fax, or online.
Mail the form to: Registration Services, Iowa Department of Revenue and Finance, PO Box 10465, Des Moines, IA 50306-0465, or fax it to (515) 281-3906, or go on their website at www.state.ia.us/tax and complete an online registration.
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Who can I contact about financing my business?
| Small Business Development Centers: If you have an SBDC office in your area, we are an excellent place to start. Most of our sevices are free and all are confidential. We offer business counseling for both start-up and existing businesses. Check the SBDC Regional Centers on this website for the center nearest you. |
| Banks: Depending on the amount of the loan and what it is used for, most banks require about 20% down, along with proper collateral, to qualify for a loan. However, a good business plan may help secure a loan even if you don't have the full 20% down payment. Banks are also the source for SBA small business loans. Not all banks make SBA loans, so you might need to visit several banks before you find one that makes them. Basically, the SBA guarantees a high percentages of a small business loan, which allows banks to make loans that they may not make without a guarantee. |
| Chambers of Commerce: Some chambers have loan programs that are for main street or manufacturing businesses. Chambers should know about other financing sources in their area. |
| Council of Governments or Regional Planning Offices: These are organized to serve city and county governments in a regional area and sometimes manage funds for business loans. |
| Iowa Department of Economic Development: This organization has several financing programs that can result in a direct loan or grant for businesses that meet the criteria for their programs. |
| Private Sources: Historically, borrowing money from private sources has been a way to finance projects. |
| Venture Capital: One additional source of money is venture capital. Venture capital is restricted to high growth companies in which the owner is willing to giver up part of the ownership of their company in return for an injection of capital. |
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Is there counseling help available other than the SBDC?
There are several options to receive business assistance if your area doesn't have an SBDC office:
- Many communities have a SCORE chapter, which are retired business executives that provide free business counseling as part of the SBA program.
- Your local Chamber of Commerce might be able to help refer you to some mentor that would help you.
- Some of the USDA (U.S. Department of Agriculture) offices and ISU (Iowa State University) Extension offices have help available for rural businesses.
- Some banks, CPAs and attorneys may also be able to help with certain simple business questions; however, if the help gets too detailed, they probably will charge a fee.
- And last, but not least, consider contacting the owner of a similar company in a different area. The key is to find someone who is not worried about competing with you
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Where can nonprofit businesses in Iowa get help?
Iowa Nonprofit Resource Center 130 Grand Ave Court Iowa City, IA 52242 Phone: (866) 500-8980 E-mail: nonprofit@uiowa.edu Website: nonprofit.law.uiowa.edu
Other nonprofit websites:
- The Alliance for Nonprofit Management - www.allianceonline.org The Alliance for Nonprofit Management is the professional association of individuals and organizations devoted to improving the management and governance capacity of nonprofits - to assist nonprofits in fulfilling their mission. Includes nonprofit FAQs and a nonprofit resource center.
- The National Center on Nonprofit Enterprise: www.nationalcne.org The NCNE helps managers and leaders of nonprofit organizations make wise economic decisions to ensure that their organizations best serve their members, clients, donors and the general public by pursuing their social missions efficiently and effectively. The NCNE is a unique knowledge reservoir, bridging academic research with practice and policy.
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How do I find a list of business names?
The Iowa Secretary of State's website (www.sos.state.ia.us) has a database of corporations registered in Iowa. From the homepage, click on the "Business Center" link located at the top left of the page. Then click on the "Corp Search" link. You will then be able to perform a search to see if a name has been registered in Iowa. We cannot insure that the database is up-to-date, so you may need to call the Secretary of State's office at (515) 281-5204 to verify that a name is available.
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How do I register a business name?
Registration of a business name depends upon the form of business to be used and upon the 'range' of the business.
A sole proprietorship or partnership doing business in Iowa should stop by their county recorders office to file a "registration of Trade Name" certificate. This form only takes a few minutes to complete and have notarized - total cost do you is generally under $10. If you are doing business locally and have little concern about expanding long term to become a large firm, then that could be acceptable.
Please know that this process by no means 'copyrights' your business name - it does not give you protection of the name outside the county - it is merely a registration that you are doing business under that name.
Should you form an LLC or Corporation, your attorney will help you complete the filings needed to register your company with the Iowa Secretary of State.
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Where can I go to find out about labor laws?
The U.S. Department of Labor has four sites that are of use to entrepreneurs who are starting or plan to grow their small businesses:
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