Individually, moving to the United States and starting a business are challenging enough. When combined, the undertaking can feel completely overwhelming. However, each year, immigrants from around the world start successful businesses in the United States. In all industries, becoming an entrepreneur is possible — no matter how long you’ve been in the country.
It’s important to acknowledge that immigrants face unique hurdles when initially launching a business. If you’re planning on starting a business as a new resident in the Greater Hartford region of Connecticut, here are some effective strategies.
Apply For An Individual Taxpayer Identification Number (ITIN)
As you begin filing the necessary paperwork for your business, you’ll quickly realize the importance of having a Social Security number. Unfortunately, those who are new immigrants are often not eligible to receive a Social Security number.
Thankfully, the Internal Revenue Service (IRS) has created a solution for this common obstacle. You can instead register for an ITIN, which is available to “individuals who are required to have a U.S. taxpayer identification number but who do not have, and are not eligible to obtain, a Social Security number.”
Having an ITIN will make it possible for you to file for things like business licenses, your company structure (e.g., LLC), and sales tax permits. It will also make it easier for you to obtain a business bank account and a business loan (if needed).
Research How To Pay Personal And Business Taxes
The way taxes are structured in the United States is different in comparison to almost every other country. Learning how to file your personal income taxes can be confusing enough. As a new small business owner, you’ll also have to learn how to properly file your business taxes. This will largely depend on the business structure you choose (e.g., sole proprietorship, LLC, etc.).
Before formally launching your business, start researching how to properly file taxes. If you don’t feel confident about doing this on your own, work with an accountant. A skilled accountant will be able to provide you with details about what documents you’ll need to save and how much you should set aside to cover each kind of tax you’re required to pay.
Outsource Critical Tasks So You Can Focus On Your Business
Every new business owner has a seemingly never-ending list of tasks to complete. As you navigate the additional hurdles that come with starting a business as an immigrant, you’ll want to save as much time as you can to devote to your core duties.
Among all of the tasks you can outsource at the outset of your new venture, website design is one of the most important. Having an engaging and effective website is crucial when looking to attract new clients and customers and build trust among your audience. By tapping into a job platform, you can have a freelance professional create a stunning website for your business.
You can also consider outsourcing other tasks (such as copywriting and logo design) to free up even more time.
Have a Clear Understanding About Payroll
Payroll is a critical function for any business. It’s essential to have a solid understanding about how to run payroll and how to pay your employees. For example, regular staff for your brick-and-mortar business should be paid through a reliable payroll platform that enables you to use automatic scheduling, offers built-in tax calculating, and even computes timesheets. This type of staff will receive a W-2 at the beginning of January to file their taxes.
Freelancers, on the other hand, are paid differently. While you can still process payroll for freelancers, you won’t take out taxes and you’ll need to use certain forms. If by chance some of your freelancers live overseas, say in your home country, it can be less expensive for you and your freelancer if you pay them through a remittance service instead of through your bank. For example, platforms like Remitly offers service in the Philippines, as well as around the world, and charge minimal fees for large fund transfers in addition to offering a great exchange rate. Just be sure that whatever you pay an overseas worker you note for your own tax purposes.
Although there are extra hurdles involved with starting a business as an immigrant, the dream of becoming a successful entrepreneur is within reach. The key is to ask for help whenever you need it and to get clarification on any law, regulation, document, or practice that seems unclear.
About the Author
Entrepreneur and business consultant Vivek Mukherjee created inspiredexpatriates.net to help other immigrants to the United States achieve their dreams of starting and running a business.