Frequently Asked Questions

How does our service work?

After you submit a Business Information Form one of our experts will review your answers and determine what registrations your business needs. Once our review is complete, you will receive an email with the necessary registration steps as well as a contract and quote for our services. Upon signing the contract and paying the fee, our business expert will collect the rest of the necessary information and file your paperwork.

What business structure should I choose?

The business structure you choose is based on certain factors. The main factors are the ease of starting and stopping the business, personal liability, and how profits will be taxed. As far as starting and stopping the business, the easiest is a sole proprietorship. Simply operating as an individual is, by default, a sole proprietorship. To operate as an LLC or corporation you must file formation documents and meet certain criteria. So, if you're just starting out, plan on just doing something small with little risk, and just not quite sure how it will turn out, the sole proprietorship is the best way to go since you can start and stop at any time. However, operating as a sole proprietorship does not offer any personal protection from litigation that may arise in the course of business. So, if you work in a field with significant risk your business assets and personal assets could be in jeopardy if something were to happen. In this case it would be best to start an LLC or Corporation, which creates a separate business entity from the owner. As long as the owner maintains that separation, their personal assets will be protected. Additionally, sole proprietors and single-member LLCs report their income and expenses on their personal income taxes making it easier at tax time. Multi-member LLCs, S-corporations, and C-corporations must file a separate business tax return, in addition to, reporting profits on their personal income tax returns. For an individual owner, a single-member LLC is usually the best option since it provides liability protection and makes it easy to file taxes.

What is an S-corp?

An S-corporation is not a business structure that you legally form with the Secretary of State like an LLC or Corporation. In fact, an LLC or corporation can elect to be taxed as a S-corporation for income tax purposes. The S election is made when the business applies for their Federal tax ID number, or EIN. The main benefit of electing to file as an S-corp is that the owner/s can issue themselves a W-2. They must pay themselves a reasonable salary and withhold all the necessary federal, state, and local withholding taxes. This is also the main downfall as it would require a business owner to obtain the necessary federal, state, and local employer accounts.

What if I don't want to use my home address to register my business?

When you register your business, the address you use becomes publicly available. In addition to the ability of people to find your address by searching your business name, you will also begin to receive a fair amount of junk mail. If you don't want to use your home address and you do not have a physical store location, then you will have to purchase the service of a Commercial Registered Office Provider or a virtual address through an online vendor. Pennsylvania does not accept addresses with a P.O. Box only but as long as a street address is included you will be allowed to use it. If you are interested in obtaining a virtual address, we can assist!

What is the PA-100?

The PA-100 is the application that a business uses to apply for one or more tax accounts with the PA Department of Revenue. The most common taxes are sales tax and employer accounts. Although it can be used to apply for various other taxes as well. Not all businesses must complete the PA-100, only those that require some time of business tax account.

Do I need to obtain a federal tax ID number (EIN)?

Most businesses should obtain an EIN. Partnerships, LLCs, and corporations are required to obtain an EIN. A sole proprietorship has the option of doing business under the owner's SSN or an EIN. Sole proprietors who hire employees or who want to open a business bank account will be required to obtain an EIN.

What is the benefit of Expedited Services?

The Department of State, like most things, has been impacted by the pandemic with staffing shortages and long review times. An expedited service request, though more expensive, allows your filing to be processed in as little as one day (If dropped off on a Monday or Tuesday). Since these requests must be dropped off in person, allow us to save you the trip to Harrisburg. The current processing time frame for normal submissions is 6-8 weeks.

What is the Business Hub?

The Business Hub is a free state website where you can create and manage your business profile.

What is a resale or reseller's license?

A resale or reseller's license is actually the PA sales tax license. It is sometimes referred to this way because the sales tax license gives the holder the ability to both claim exemptions from sales tax when they purchase goods for resale and to also collect PA sales tax when they sell the goods to the end consumer. If you need to claim a the resale exemption but you do not have to collect sales tax then you could also obtain a wholesaler license. The wholesaler license gives the holder the ability to claim the resale exemption but not to collect sales tax.

What do I need to open a business bank account in PA?

In order to open a business bank account in Pennsylvania you need a federal income tax ID (EIN) and to register your business with the PA Secretary of State. You must provide your EIN awards letter as well as an approved copy of your legal formation documents. If you do not have a copy of your EIN awards letter you must reach out to the IRS and request a new one. If you do not have your legal formation documents you can purchase another copy through the PA Department of State's system called PENN File.