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Complete guide: entity types, registration, costs, taxes, labor laws, and break-even analysis
~49 days
Setup Time
~$250
Setup Cost
21%
Corporate Tax
100%
Foreign Ownership
#6
Ease of Business
| Entity | Min Capital | Foreign % | Liability | Min Shareholders | Best For |
|---|---|---|---|---|---|
Limited Liability Company (LLC) | None | 100% | Limited | 1 | Most flexible — pass-through taxation, simple structure, no minimum capital |
C-Corporation | None | 100% | Limited | 1 | Venture-backed startups, companies planning IPO — can issue multiple stock classes |
S-Corporation | None | No | Limited | 1 | US citizens/residents only — pass-through tax with corporate structure |
Sole Proprietorship | None | 100% | Unlimited | 1 | Simplest form — no formal registration needed beyond local permits |
Branch Office | None | 100% | Unlimited | 0 | Foreign companies testing the US market |
Choose State of Incorporation
Delaware (most investor-friendly), Wyoming (low cost), or state of operations
0-1 days
Free
State Secretary of State
File Articles of Incorporation/Organization
Submit formation documents with Secretary of State
1-7 days
~$150
Secretary of State
Obtain EIN (Tax ID)
Apply for Employer Identification Number from IRS — free, instant online
0-1 days
Free
IRS
Register for State Taxes
Register for state income tax, sales tax, unemployment insurance
1-7 days
Free
State Tax Authority
Open Business Bank Account
Requires EIN, formation documents, and operating agreement
1-3 days
Free
Commercial Bank
Obtain Business Licenses
City/county business license, industry-specific permits
3-30 days
~$100
City/County
$1260/mo
Minimum Wage
$5000/mo
Average Wage
40 hrs/week
Work Hours
0 days/year
Paid Leave
0 weeks/year
Severance
7.65% of salary
Employer Social Security
7.65% of salary
Employee Social Security
Required
Foreign Worker Permit
Foreign Worker Quota: H-1B visa capped at 65,000/year + 20,000 for advanced degree holders. L-1, E-2 available.
#6/190
Ease of Business Rank
4 days
Starting a Business
15 days
Registering Property
420 days
Enforcing Contracts
69/100
Corruption Perception
92%
Internet Penetration
USD
Currency
UTC-5 to UTC-10
Time Zone
18
Retail (months)
14
F&B (months)
12
Tech (months)
30
Manufacturing (months)
10
Services (months)