What You’ll Learn

Personal and Business Cash Flow Planning

Before your business generates consistent revenue, you need a clear picture of how your personal cash flow will be affected and where startup capital will come from. This section covers how to structure your compensation to optimize net income, which personal accounts to tap for initial investment, whether a line of credit makes sense to smooth over fluctuating revenue, and how to build contingency plans if growth doesn’t materialize as expected.

Choosing the Right Legal Structure

The entity you choose — sole proprietorship, partnership, C-corporation, S-corporation, or LLC — determines how your business income is taxed, how liability is handled, and how easily you can raise capital or bring in partners. Each structure has distinct advantages and trade-offs: C-corps offer the strongest liability protection but face double taxation, while S-corps pass income through to shareholders but face eligibility restrictions. An LLC offers flexibility to be taxed as any of the above.

Bookkeeping, Licensing, and Employment

Establishing solid recordkeeping systems from day one — including separate business accounts, receipt management, and accounting software — protects you at tax time and positions you for growth. You’ll also need to confirm all applicable city, county, state, and federal licenses and permits are in place. If you plan to hire employees, the checklist walks through employment terms, HR policies, Workers Compensation Insurance, and the retirement plan implications of having staff.

Tax Planning for New Business Owners

Your tax situation changes substantially when you start a business. You may be able to deduct startup costs, home office expenses, and health insurance premiums. You’ll likely need to begin making quarterly estimated tax payments and understand how your entity choice affects your exposure to self-employment tax and corporate tax. The checklist also covers sales tax obligations and eligibility for the Qualified Business Income deduction.

Insurance, Estate Planning, and Exit Strategy

New business owners often underestimate their insurance needs. This section covers business interruption, professional liability, data breach, health insurance, and life insurance — including key person coverage and buy-sell agreement funding. Your estate plan should be updated to reflect business interests, and your will, trust, and powers of attorney should direct how those interests are managed and transferred. Even at startup, outlining a basic exit strategy — whether that’s acquisition, family transfer, ESOP, or liquidation — shapes how you build the business from the start.

Business Partners, Succession, and Intellectual Property

If you have or plan to have business partners, formal agreements that address triggering events such as death, disability, divorce, and disagreement are essential from the beginning. A buy-sell agreement can set a clear path for ownership transfer. If children may eventually join the business, incorporating tax-efficient ownership transfer strategies early in your estate and gifting plan is far easier than retrofitting them later. And if your business involves proprietary methods, names, or content, an attorney should assess trademarks, copyrights, and patent protection.