Company in Tennessee

Setting up a company in Tennessee does not have to be difficult. You just need to have a business plan, decide on an entity, and learn the steps for registering your business.

To protect your personal assets and keep your personal and business finances separate, it’s best to form a Tennessee limited liability company (LLC) or add your name to the list of Tennessee corporations in the Volunteer State. Some companies opt to establish themselves as limited liability Tennessee partnerships.

Any Tennessee resident who can form a legally binding contract can register a company in Tennessee. Therefore, a minor cannot register a business as they lack the legal capacity to do so.

Getting Things Off the Ground

Before you choose the structure of your company in Tennessee, you’ll need to develop a business plan – a course of action that will help you organize milestones and goals. Your business plan will contain an Executive Summary, Company Description, and Market Analysis, besides other categories. 

You can set up a business plan by visiting the Small Business Administration’s website, which will give you some formats to follow. For example, the Executive Summary will provide, in a nutshell, an overview of your company’s mission and the products and services it provides. Money-related details and suggestions for expansion are featured as well.

You can describe client benefits and solutions under “Company Details.” The names and contact info for company professionals and business addresses are added as well. 

For your Market Analysis and Research section, you’ll want to include your company’s strategy for handling trends in the marketplace.

You can also use the business plan to further elaborate on your business structure–LLC or corporation–and include an organizational chart to outline the responsibilities of the executive team.

In your business plan, you have the opportunity to define your goods and services and explain why customers should choose your company. You can also demonstrate why it’s in the best interests of inventors to fund your company’s capital. 

Moreover, you can use forecasts to support your funding requests as well as create an appendix of documents to back your arguments and business plan. With a business plan in place, you can successfully debut your company and highlight its strong points and objectives.

Numerous Types of Companies Call Tennessee Home

Probably an LLC is the easiest company to register as it is both flexible and takes less time to establish than a corporation. Whether you form an LLC or corporation, you’ll find these entities will keep your home and car(s) safe from business creditors and lawsuits. 

While Tennessee partnerships do not have to be registered, you can form a limited liability partnership if you have two or more members under a domestic LLC.

An LLC is normally preferred by Tennessee companies that represent independent business owners while Tennessee corporations are established by companies with national or international distribution goals.

What Exactly Is an LLC?

An LLC offers the pass-through taxation of a sole proprietorship and partnership as well as the limited liability protection of a corporation. You can set up a single-member LLC or multi-member LLC, depending on your business goals.

You can also establish an LLC as an individual, trust, estate, corporation, or another LLC. This business structure offers a great deal of flexibility and few restrictions.

The debts of LLC members are only limited to the number of their individual capital contributions. 

How Corporations Operate

The shareowners of a corporation do not have personal responsibility for the debts or actions of the company since a corporation is considered a distinct legal business entity. The board of directors, who are elected by the shareowners, is responsible for running the business.

A corporation cannot legally exist if it does not submit articles of formation or articles of incorporation. It also should draft bylaws that include a concise statement about the company’s objectives and the roles, names, and exact duties of its founders. The bylaws are designed to resolve any internal disputes and to keep the company on track with respect to its policies and procedures.

Tips for Starting a Tennessee LLC or Corporation

The following steps must be followed when establishing a limited liability company (LLC) or corporate company in Tennessee.

  1. Make sure your company is easily distinguishable by using a memorable name. The Secretary of State’s website is where you want to begin your search for a unique company name. Check to see whether the name you’ve chosen is appropriate for the service or commodity you want to market. Make sure you have a second name in mind in case the name you want has already been taken.
  2. Employ a Tennessee registered agent to submit and receive official paperwork on your behalf. The registered agent must be a company or person who resides in Tennessee and is available during regular business hours, or Monday through Friday, 8:00 am to 5:00 pm.
  3. Choose a board of directors if you plan to incorporate.
  4. File articles of incorporation if you plan to set up a corporation and register your business.
  5. File articles or organizations if you want to establish a Tennessee LLC. You can make things easier by filling out an online application.
  6. If you plan to establish an LLC, draft an Operating Agreement that you can use internally to settle disagreements or employee grievances.
  7. Create the Bylaws if you plan to incorporate them. Corporate Bylaws, in Tennessee, are not required by the Secretary of State to be made a part of the public record. However, these internal rules are highly recognized as they cover everything from voting processes to finances and the distribution of stocks.
  8. Obtain an Employer Identification Number (EIN) from the IRS. You cannot establish a business bank account or pay employees without this number.
  9. Establish the accounting system you wish to use – single-entry or double-entry. Work with your accountant to set up the system and employ the correct bookkeeping software.
  10. Set up your business bank account.
  11. Check on the permits and licenses for your business. Make sure you are compliant.

Call the Corporation Center and Launch Your Company in Tennessee Today

Are you getting a company off the ground in the Volunteer State? If so, visit the Corporation Center website immediately and fill out an application form now. This will make things much easier. If further information is needed, call the Corporation Center at (800) 580-4870 with your inquiries.