June 9, 2023

How to register a US business from Nigeria

With Firstbase since:

Every company or startup has a beginning. These beginnings can stretch across the globe. No matter where companies and employees are based, all companies using Firstbase are incorporated in the US, even those starting in emerging African markets like Nigeria. 

We’ve recently seen many tech startup founders and ambitious individuals starting up from Nigeria and simultaneously rooting their businesses on US soil, and we wanted to share the steps they took. We wanted to enable others eyeing this strategy to know how to register a US business from Nigeria. 

Why Register a US Business from Nigeria?

But first, for those reading this who’ve never considered this move, here’s why you should register your business or tech startup in the US from Nigeria:

  1. 2023’s rapid technological expansion sees greater opportunities to take advantage of
  2. Nigerian entrepreneurs and startup founders can leverage the opportunities found in the world’s biggest tech investment market, with a third of the $5 trillion global IT market located in the US.
  3. You’ll have more access to venture capital markets than if you’d invest anywhere else in the world.
  4. Startups have better growing and selling opportunities, with the potential to take your now fully-fledged business public.
  5. Startups enjoy more efficient tax and corporate structures familiar to acquirers, employees, potential investors, and strategic partners.
  6. US investors are currently showing a keen interest and focus on investing in rapidly expanding markets like Nigeria.

From Nigeria to the US: 6,630 Miles in Eight Easy Steps

If you are a Nigerian entrepreneur considering establishing a business presence in the US, it is crucial to understand the process and requirements involved in registering a US business. While the following steps can help you navigate the steps of registering a US business from Nigeria successfully, we recommend you seek further guidance.

1. Conduct market research

Before venturing into the US market, it is essential to conduct thorough market research to evaluate the feasibility of your business idea. Understand the target market, competition, legal requirements, and potential challenges you may encounter. This analysis will help you make informed decisions and develop a solid business plan.

2. Choose a business structure

Selecting the appropriate business structure is a critical decision that affects various aspects of your US business, including liability, taxation, and operational flexibility. The common business structures in the US are sole proprietorship, partnership, limited liability company (LLC), and corporation. Consult with a legal professional or business advisor to determine the most suitable structure for your needs. Why not take the LLC vs. CCorp quiz to ascertain which type of business is best for you?

3. Register with the Internal Revenue Service (IRS)

Acquiring an Employer Identification Number (EIN) from the IRS is a fundamental step in the registration process. While this may be complicated, our team at Firstbase can help. An EIN is necessary for tax purposes and allows you to hire employees, open a bank account, and conduct business activities in the US. You can also apply for an EIN via the IRS website or mail.

4. Choose a business name and check availability

Select a personalized name for your US business that reflects your brand identity. Conduct a thorough search to ensure that another entity does not already use the chosen name. You can check the availability of your chosen business name through the Firstbase name check tool.

In addition, you can use the United States Patent and Trademark Office (USPTO) website to search for existing trademarks. Registering a trademark is not mandatory but can provide additional protection for your brand.

5. Register your business with the state

To operate legally in the US, you must register your business with the state where you will establish your presence. The registration process typically involves filing the necessary forms, paying the required fees, and providing relevant information about your business. We recommend you get assistance from Firstbase for this and use Firstbase Agent. Each state has its own procedures, so it is advisable to consult the Secretary of State’s office or engage a professional service to guide you through the registration process. Check out Firstbase Payroll Registration during this step.

6. Obtain the Necessary Permits and Licenses

Depending on your business activities and services, you may be required to get specific permits and licenses at the federal, state, or local levels. If you need to obtain insurance, check out how Firstbase can help with this. Research and identify the permits and licenses relevant to your industry and comply with the regulations. Examples of commonly required licenses include professional licenses, health permits, and sales tax permits.

7. Open a US Business Bank Account

Establishing a US business bank account is crucial for managing financial transactions and separating personal and business finances. Contact reputable US banks and compare their services, fees, and requirements. Then contact Firstbase Bank, the only company out there to help foreign founders to get a bank account before incorporation with pre-EIN bank services. 

Due to enhanced anti-money laundering measures, some banks may require you to have a US-based representative or physical presence to open an account. Consider partnering with a trusted financial institution that offers international banking services to assist you in this process.

8. Comply with tax obligations

As a new US business owner, you are subject to federal, state, and local taxes—This can be expensive. However, Firstbase can do this more cost-effectively for those seeking a cheaper alternative. Familiarize yourself with the US tax system and its requirements to ensure compliance. Consider consulting a tax professional specializing in international taxation to help you navigate the complexities of US tax laws and maximize your tax benefits.

Need help registering your US business from Nigeria?

Incorporating your Nigerian business into the US can be rewarding. Still, it requires careful planning, research, and adherence to legal and regulatory obligations. When you follow the steps outlined above, you will be well-prepared to navigate registering a US business from Nigeria. However, remember to consult with legal and financial professionals to ensure compliance and make informed decisions that align with your business goals.

Also, speak to our team at Firstbase. Firstbase, a self-service business model, makes incorporation easy. We help founders create LLCs and C-Corps in 43 states and help businesses in Africa, specifically Nigeria, register and incorporate in the US. We walk with startups, specifically Tech startups, on the professional road to the US from Nigeria. If you reside in Nigeria and want to register a US business, click below to take your first step from Nigeria to the US with Firstbase.

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