Mexico. Once known for its sunshine, ancient ruins, rich culture, beaches, delicious cuisine, and tourist hotspots, and now known for business. Yes, what was, and is, an esteemed tourist destination has become a startup mecca for aspiring entrepreneurs. Thanks to its increased access to partnerships, business opportunities, venture capital markets, and startup investors, as well as its familiar and efficient tax and corporate structures.
With every reason for registering a US business from Mexico, many are now seeking the answers to making this possible – because it is possible. It’s also reasonable for companies seeking sustainable financing options that go way beyond Series A and pre-seed and want to operate in the US market.
Before delving into the “how,” let us just note that this move isn’t reasonable for companies not looking for venture capital financing and those focusing only on the Latin American market.
Let’s continue onto the “how,” then. How do you register a US business from Mexico – the land of business and pleasure?
First, you must decide on the business structure you want to establish. The most common structures in the US are limited liability companies (LLCs), sole proprietorships, partnerships, and corporations. Speak to a legal or tax expert to determine the most suitable structure for your business before taking the bull by the professional horns. Why not take the LLC vs. CCorp quiz to ascertain which type of business is best for you?
Step one is done. Now it’s onto step two. Here you’ll need to choose the state where you want to register your business. Each US state has its own laws and requirements for business registration. Some states are more business-friendly and offer certain advantages, such as lower taxes or simpler registration processes. Consider factors like taxation, business environment, and your target market when selecting a state.
Almost at the halfway mark, step three involves selecting a name for your startup that complies with the naming regulations of the state where you’ll register. You can check the availability of your business name through the Firstbase name check tool.
In step four, you’ll need a Firstbase registered agent where you register your business. The registered agent will be responsible for acquiring legal and official documents for your business. You can also hire a registered agent service or choose an individual who meets the requirements.
An EIN, otherwise known as a federal tax identification number, is required for most businesses in the US. You can obtain an EIN from the Internal Revenue Service (IRS) or at Firstbase. The EIN is mainly used for tax purposes and is necessary for hiring employees, opening bank accounts, and filing tax returns. If this sounds too confusing, Firstbase can help you with all this. Speaking of bank accounts, you’ll want to set up a bank account during this stage. Preferably, Firstbase can open up pre-EIN bank accounts for you. With this done, you’re halfway there.
In this step, prepare and file the necessary documents with a state agency or the Secretary of State. Firstbase can assist you with submitting the documentation on your behalf. The specific documents will depend on the chosen business structure. For example, if you’re forming an LLC, you’ll typically need to file Articles of Organization.
With the necessary documents filed, you’ll need now to ensure compliance with any additional state and federal requirements. As compliance is not exactly simple, speaking to Firstbase can simplify this step and help you satisfy compliance demands. This may include obtaining licenses and permits specific to your industry or business activity. Check with the state and local government agencies to determine the necessary requirements for your startup.
Almost at the finish line – it’s time to familiarize yourself with the tax obligations for your US business. You’ll need to understand the federal tax requirements and the state’s tax regulations where your business is registered. Consider consulting with a tax professional who is knowledgeable about international tax matters.
And we’re at the finish line. Now seek legal and professional assistance for final compliance and formation. This can cost thousands of dollars, but Firstbase can help you with cheaper solutions. Engage an attorney or business consultant specializing in international business or US company formation to help you navigate the process and ensure compliance with all legal requirements. And you’re done.
It’s important to note that the steps mentioned above are fundamental and that processes and requirements may differ depending on the state and the type of startup you’re establishing. Therefore, it’s recommended to consult with professionals and research the state’s specific regulations where you intend to register your US business. With this, we invite you to bring us into the process.
While this is an essential guide to startup equity, we encourage you to take your startup equity knowledge to an even higher level. Ready to start? Firstbase makes startup equity and incorporation easy, helping founders create LLCs and C Corps in 43 states. Ready to incorporate your company and begin building business credit? Contact our team today to speak about registering a US business from Mexico.