How to Register a Business in Pennsylvania

by Jennifer Kiesewetter in Guide
timelapse photography of city

Source: Unsplash

TLDR

  • Pennsylvania is known for its rich U.S. history and is also friendly to founders, startups, and entrepreneurs.
  • When you register your startup in Pennsylvania, you’ll need to satisfy several legal requirements to register your business correctly. However, before registering your startup, it’s a good idea to plan ahead, for example, researching the market and potential competitors, mapping out your financing, planning for operations and personnel, and creating a business plan. Pennsylvania provides various resources to help you start a business, helping you identify what resources you’ll need as you launch your startup.
  • Before you register your startup in Pennsylvania, in addition to creating a business plan, you must also determine your startup’s legal ownership structure. Popular structures include sole proprietorships, general partnerships, limited partnerships, limited liability partnerships, limited liability limited partnerships, limited liability companies (LLCs), C-corporations, and S-corporations.
  • When you’re ready to register your startup, depending upon your chosen business structure, Pennsylvania requires you to choose a unique business name, differing from any other registered businesses in the state. In addition, you must follow Pennsylvania’s business naming conventions, which help make your startup’s name distinguishable.
  • Depending upon your chosen business structure, you’ll need to register with the Pennsylvania Department of State before commencing operations in the state. You may file your formation forms by U.S. mail, in person at Pennsylvania’s Department of State’s office, or online through Pennsylvania’s online portal, PENN File.
  • With online filing options, you can register your Pennsylvania startup in as little as a few hours. However, if you mail in your registration forms instead, you may have to wait a few days for your startup to be up and running officially.

Pennsylvania is known for its rich U.S. history, marking the location for writing the Declaration of Independence, the U.S. Constitutions, and the Gettysburg Address. In addition, Philadelphia is home to the Liberty Bell and Independence Hall, and Pittsburgh is known for its steel and 446 bridges. And don’t forget Hershey, Pennsylvania, home to – well – Hershey’s.

Pennsylvania is also friendly to founders, startups, and entrepreneurs. Entrepreneurs in Pennsylvania have significant support, from the Wharton School at the University of Pennsylvania to ecosystem builders like Alliance for Women Entrepreneurs and SEED SPOT.

Pennsylvania is also small business-friendly, with over 1.1 million small businesses, employing 2.5 million people, according to the U.S. Small Business Association (SBA). Top small business industries include construction; health care and social assistance; professional, scientific, and technical services; accommodation and food services; administrative, support, water management; manufacturing; and wholesale trade.

As a startup founder, if you consider registering your business in Pennsylvania, this article will walk you through what you need to know.

How to Register a Business in Pennsylvania

When you register your startup in Pennsylvania, you’ll need to satisfy several legal requirements to register your business correctly. However, before registering your startup, it’s a good idea to plan ahead, for example, researching the market and potential competitors, mapping out your financing, planning for operations and personnel, and creating a business plan. Pennsylvania provides various resources to help you start a business, helping you identify what resources you’ll need as you launch your startup.

The creation of a business plan is critical to your startup’s growth. Think of it as the foundation of the house you’re building. In drafting your business plan, you’ll want to consider marketing, advertising, sales, location, and ownership, to name a few categories. To help guide you, you can check in with the U.S. Small Business Administration, providing additional guidance for creating a business plan.

Once you’ve identified some of your business’s operation basics, it is then time to register your startup. Below, we’ll walk you through the steps necessary to register your business in Pennsylvania.

Determine Your Business’s Entity Structure

Before you register your startup in Pennsylvania, in addition to creating a business plan, you must also determine your startup’s legal ownership structure. Popular structures include sole proprietorships, general partnerships, limited partnerships, limited liability partnerships, limited liability limited partnerships, limited liability companies (LLCs), C-corporations, and S-corporations.

Let’s look at some structures more specifically. A sole proprietorship is “the simplest form of business organization and allows the individual owner to have sole control and responsibility.” For these types of entities, “[t]here is no filing required to be made with the Department of State to form a sole proprietorship.”

A Pennsylvania limited partnership is “a partnership formed by two or more persons having one or more general partners and one or more limited partners. The general partners function like the general partners in a general partnership. The limited partners have limited exposure to liability and are not involved in the day-to-day management of the limited partnership.”

On the other hand, a limited liability company is “a cross between a partnership and a corporation. It might be considered as a limited partnership without a general partner. Owners of a limited liability company are called members and may include individuals, corporations, or other LLCs. The limited liability company provides the liability protection of a corporation for owners, with the advantage of being treated as a partnership for taxation purposes and management flexibility.”

Your chosen business entity determines the next steps in registering your startup. Read on to learn about the next steps.

Choose the Name of Your Startup

When you’re ready to register your startup, depending upon your chosen business structure, Pennsylvania requires you to choose a unique business name, differing from any other registered businesses in the state. In addition, you must follow Pennsylvania’s business naming conventions, which help make your startup’s name distinguishable.

To confirm if your startup’s name is distinguishable from other registered businesses, you can use Pennsylvania’s business entity search tool.  

Remember, this is only a preliminary search for a similar business name. Once you file your startup’s registration, another name availability search will be conducted when your application is processed.

Suppose you’re not quite ready to register your startup, but you’d like to preserve your startup’s name. In that case, you can file a name reservation application with Pennsylvania’s Department of State’s office. You may keep your business name reserved for 120 days, along with a $70 filing fee.

You may choose to use a fictitious name for sole proprietorships other than using their name. A fictitious name can also be used as a “doing business as,” or DBA, for corporations, partnerships, or LLCs. Founders must file their fictitious names with Pennsylvania’s Department of State.

Identify Your Registered Agent

Each registered entity must have a “registered address,” often called a “registered agent” in other states. Any service of process of legal documents may be sent to the registered address on file with Pennsylvania’s Department of State.

Submit Your Formation Forms

Depending upon your chosen business structure, you’ll need to register with the Pennsylvania Department of State before commencing operations in the state. You may file your formation forms by U.S. mail, in person at Pennsylvania’s Department of State’s office, or online through Pennsylvania’s online portal, PENN File.

Additionally, you’ll need to file the appropriate filing fee along with your formation documents. Paying the wrong amount can result in the return of your documents, further delaying your startup’s formation.

Pennsylvania’s Department of State provides all business registration forms for your startup. For example, for an LLC, you can use the sample forms provided on the site for your certificate of organization, which also notify you of the required filing fee. In addition, you’ll file articles of incorporation for corporations, and for limited partnerships, you’ll file a certificate of a limited partnership. All forms can be filed online.

What to Do Next

After you submit your formation forms, registering your startup with the state, you’ll also need to obtain a federal employer identification number for banking and tax filings. Additionally, you’ll need to check in with the State of Pennsylvania and your local city and county to see if there are any additional business registrations required, such as a business license.  

How Long Does It Take to Register a Business in Pennsylvania?

With online filing options, you can register your Pennsylvania startup in as little as a few hours. However, if you mail in your registration forms instead, you may have to wait a few days for your startup to be up and running officially.

Like any other task, preparation is vital. The more you prepare, the faster you’ll complete your registration. By researching your business’s services or products, determining if your startup name is unique, and choosing your ownership structure, you’ll be better prepared to complete the necessary registration forms. 

How Much Does It Cost to Register a Business in Pennsylvania?

Depending upon your chosen entity for your startup, you will have filing fees due when registering your company. For example, if you register as a corporation or an LLC, you’ll pay a filing fee of $125 if filing online.

You’ll also need to file annual reports for your startup. You may also be required to file a decennial report, justifying your “entity’s continued existence or a report of continued use of certain marks.” You’ll need to budget for these filing fees as well.

After submitting your registration forms, you need to learn about any required state or local licenses, such as a business license.

Also, depending upon your entity, you may be liable for Pennsylvania’s business taxes, such as withholding, sales tax, and corporate tax. To better understand your state tax obligations as a startup, you can check with the Pennsylvania Department of Revenue, or you should consult with an accountant familiar with Pennsylvania tax laws.

How Do You Register as a Woman-Owned Business in Pennsylvania?

In Pennsylvania, if you are a woman-owned business, you have access to several certificate programs and resources, such as the Pennsylvania Small Business Development Centers (SBDC), the Women’s Business Enterprise Center (WBEC) East, and the Women’s Opportunity Resource Center (WORC) as well as the Office of Women’s Business Ownership, part of the U.S. Small Business Administration.

In addition to the state certification, you can also explore national certifications, such as those offered by the Small Business Administration (SBA). For example, the SBA offers three types of certifications for women-owned businesses, including the Women’s Business Enterprise (WBE), the women-owned small business (WOSB), and the Economically Disadvantaged Women-Owned Small Business (EDWOSB). To learn more about these certifications, visit the SBA’s website.

The Benefits of Registering a Business in Pennsylvania

Here are some benefits of registering your startup in Pennsylvania:

The Limitations Associated with Registering a Business in Pennsylvania

Here are some limitations of registering your startup in Pennsylvania:

  • Additional taxes, such as local wage and service taxes
  • Confusing highway system
  • Toll roads
  • Getting used to the nuclear power plant sirens

Learn more with us

Access more guides in our Knowledge Base for Startups

We Can Help!

At AbstractOps, we help early-stage founders streamline and automate regulatory and legal ops, H.R., and finance so you can focus on what matters most—your business.

If you’re looking for help registering your Utah startup, we can get your documentation ready, overall shepherding this process to ensure it’s done right. Get in touch with us.

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Note: Our content is for general information purposes only. AbstractOps does not provide legal, accounting, or certified expert advice. Consult a lawyer, CPA, or other professional for such services.

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