Starting a Business in North Dakota
Is Entrepreneurship for You?
Becoming a successful entrepreneur requires thorough planning, creativity and hard work. Consider whether you have the characteristics and skills commonly associated with successful entrepreneurs.
Find a Mentor or Counselor in North Dakota
Take advantage of free counseling services, from preparing a business plan and financing to marketing and management. When starting a business, advice from SBA partner organizations such as SCORE Mentors, Small Business Development Centers and Women's Business Centers can help you avoid common pitfalls.
- Online Training and Tools - take advantage of free training and counseling services, from preparing a business plan and securing financing, to expanding or relocating a business.
Types of Businesses - Know Your Options
Explore the opportunities that are available, like a home-based or online business.
Create a Business Plan
A business plan serves as an assessment tool for the owner. As you work through the points of the plan, you will have to reaffirm the viability of your ideas. As you grow your business, a plan will help you keep track of the details and make sure the business is progressing as you intended.
Do Your Market Research
To run a successful business, you need to learn about your customers, your competitors, and your industry.
Choose Your Business Structure
The business structure you choose will have legal and tax implications. Each structure has certain advantages and disadvantages depending on the size and type of business. Learn about the different types of business structures and find the one best suited for your business.
The North Dakota Secretary of State's website provides a brief overview of the most prevalent structures admimistered by the Secretary of State. Procedural information and registration forms are available from this website or from the Secretary of State's office.
You must have a valid Employer Identification Number (EIN) from the IRS before registering your business type in the state of North Dakota. An EIN is not required if a business is a sole proprietorship without any employees, without a KEOGH plan, and if the sole proprietor does not file excise tax forms such as thse for sales tax, alcohol, or tobacco. However, a sole proprietor who is a household employer in their private home is required to obtain an EIN.
- Internal Revenue Service (IRS) - 1-800-829-1040
Register Your Business Name with the North Dakota Secretary of State
Any person, corporation, or limited liability company that uses a name other than the owner's or the true name of the organization is required to register their trade name. A Fictitious Name Certificate must be submitted by a general or limited partnership.
A North Dakota corporation or limited liability company (LLC) must file articles of incorporation or organization to acquire corporate or limited liability status.
A North Dakota Limited Liability Partnership (LLP) or a Limited Liability Limited Partnership (LLLP) must register to acquire limited liability status. Forms are not prescribed; however, filing must be formatted as prescribed by North Dakota Century Code, Chapters 45-10.1 and 45-23.
Out-of-state owned businesses must register with the Secretary of State prior to transacting business in North Dakota.
- North Dakota Secretary of State - 1-800-352-0867
- The Green Book - North Dakota new business registration forms
- Choosing Your Business Name - choosing a business name is an important step in the business planning process. Not only should you pick a name that reflects your brand identity, but you also need to ensure it is properly registered and protected for the long term.
Choose a Location
Local zoning laws impact several critical business decisions such as purchasing property and making improvements to existing property, so it is important to understand the laws before you commit to anything.
Home-based business owners are subject to many of the laws and regulations that apply to other business owners.
Contact the city auditor for information on permits and zoning ordinances that apply to businesses within the city limits. Contact the county auditor for permits and zoning ordinaces that apply to businesses outside city limits.
- Leasing Commercial Space - find out what to expect when leasing a commercial office space for your small business.
Obtain North Dakota Business Licenses & Permits
Virtually every business needs some form of license or permit to operate legally. However, licensing and permit requirements vary depending on the type of business you are operating and where it's located.
- Federal Licenses & Permits - if your business is involved in activities supervised and regulated by a federal agency - such as selling alcohol, firearms, commercial fishing, etc. - you may need to obtain a federal license or permit.
- SBA's Business Licenses and Permits Tool - SBA’s Business Licenses and Permits tool can help you find the licenses and permits that may apply to your business.
Learn About Business Laws & Regulations
Even if you're starting out on a small level, you must comply with local, state and federal regulations. Regulations vary by industry and you will need to carefully investigate the regulations that may affect your business.
Properly Fund Your Business
Some businesses can be started on a shoestring budget. Others require considerable investment. It is important to know you will have enough money to launch your business.
Determine Your Federal and State Tax Obligations
As a business owner, you'll need to manage your tax obligations throughout the year. This includes keeping records, setting up accounting procedures, and making regular income tax payments.
North Dakota State Tax Department - 1-877-328-7088
- Sales & Use Tax - any business making taxable sales of tangible personal property or certain services to the end user is required to hold a North Dakota sales and use tax permit.
- State Income Tax Reporting - income taxes will be levied by the State of North Dakota on the earning sof any business.
- State Income Tax Withholding - an employer is required to withhold state income tax from wages paid to an employee if the employee performs services within North Dakota and wages are subject to federal income tax.
- "Application to Register for ND Incoem Tax Withholding" (Form 301) must be completed in advance of withholding.
- "Income Tax Withholding Return" (Form 306) must be filed for each quarter.
- "ND Transmittal of Wage & Tax Statements" (Form W-2) must be file don or before February 28 following the close of the calendar year.
Learn about employment and labor laws to make sure your business is in compliance.
North Dakota Department of Labor - 1-800-582-8032
- North Dakota Labor Laws - North Dakota's labor laws address items such as breaks, overtime, and deductions from pay.
- Posters - there are nine state and federal posters which North Dakota employers must post in an area readily accessible to all employees. All nine posters can be downloaded from the North Dakota Department of Labor website.
Job Service of North Dakota - 1-800-832-9787
- Unemployment Insurance - businesses are required to provide unemployment insurance coverage for their employees if they meet certain criteria. A "Report to Determine Liability" must be filed within 20 days after first employing workers.
North Dakota Workers Compensation - 1-800-777-5033
- Workers' Compensation Insurance - with certain exceptions, workers' compensation insurance must be carried to provide protection to employees injured in on-the-job accidents. Contact North Dakota Workfoce Safety & Insurance to request an "Application for Insurance"
- New Hire Reporting Requirement - businesses must report each new hire within 20 days from the individual's first day of work (SFN 1018).