Become PhillyBiz Official

Why it is important and advantageous to form a legally recognized and compliant business.

Making your business official, positions it to benefit from many different programs, financial resources, tax advantages, contracting, and other opportunities. In addition, by covering all the bases, you will be providing your business with legal and liability protections that minimize your personal and business risk exposure.

Ensuring your business complies with city, state and federal requirements will position your business for these advantages and benefits. To get there, important foundational work is required to complete and fulfill all incorporation, business registration and compliance documentation requirements.

Research Your Idea

Business ideas are about identifying and pursuing unmet opportunities, rewarding the entrepreneur or business owner financially, in the form of business profits.

To make well informed decisions that position you for success, it is important to:

• Conduct market research to see if there is a product market fit for your idea, and to validate its viability and potential for success in the real world. Thorough and useful research includes knowing your target audience, customers, clients, industry, and competitors. 
• Analyze your research findings, and compile those findings into a detailed business plan and make decisions related to this checklist. 

Know Your Business Offerings

Understand Your Industry

Your products and / or services will fall within an industry or sector. It is beneficial to you to learn as much as possible about the key differences between a business sector and industry, and under which your business falls. 

Knowing your industry helps narrow down your research field to focus on more direct market and competitor analysis. This is important to gathering the right type of business intelligence and your ability to compete more effectively.

Oftentimes, industry-specific resources are available to entrepreneurs. 

To search the PhillyBizHub ecosystem for resources available to you by industry, select organizations or resources from the main. On either directory page under the search suggestions column, view and select your industry from the drop down menu option “For what industry”. 

Common Business Sectors of Greater Philadelphia Include

• Artificial Intelligence
• Arts & Culture
• Barber Shops & Salons
• Business & Professional Services
• Childcare
• Community Development Organizations
• Construction
• Design
• Entertainment
• Food & Beverage
• Information & Technology
• Life Sciences
• Manufacturing
• Retail
• Tourism & Hospitality
• Wellness & Personal Care

Name Your Business

Choose a unique business name- a name that no other business uses.
Verify availability of your unique business name with the Commonwealth of Pennsylvania Check HERE.

Choose a DBA (Optional)

(Doing Business As) name, also known as a fictitious business name. You can choose to register a fictitious name or DBA, or you use your own name as your primary business ID. 

Select Org Structure

For assistance in determining which structure best suits your vision and needs, consult with a PhillyBizHub® Resource Organization.
Below is a list of legal structures for you to learn more about and consider.

• Individual | Sole Proprietorship
• Partnership
• Limited Liability Corporation(LLC) – link / upload FORM
• C Corporation 
• S Corporation 

Name Your Officers

Name Officers With Titles And Members Of Your Business OrganizationUnder most business legal structures, you need to select officers. You choose to have only one officer if that is your preference. When choosing a structure that has more than one member, you will need:

• Full legal names, addresses and contact information for each member
• Notify members and confirm membership in your organization
• Assign any roles titles where required

Write a Business Plan

Solidify your idea into a well thought out business plan that is based on thorough product-market fit research, analysis and a defined strategy for long term success.

Writing a comprehensive business plan provides you a full picture understanding of your business and prepares you to confidently proceed with completing official business formation and operation requirements.

Obtain EIN

Obtain A Business Tax ID Number – EIN

Your Employer Identification Number (EIN) is issued by the Internal Revenue Service (IRS).

How to obtain your EIN number: 

• You can file for an EIN online here at the IRS website – immediate decision
• Call the IRS at (800) 829-4933– allow up to 4 weeks for delivery via US Mail
• Cost: Free when applying online through the IRS

Why Business structures must have an EIN

•  Identifies a business with the Internal Revenue Service (IRS)
• Tax registration and filing purposes
• Hiring employees
• Opening a business banking account
• Completing other business registration requirements
• Obtaining licenses and permits

Understanding Your EIN and Why It Is Needed

• An Employer Identification Number (EIN) is a nine-digit number assigned by the Internal Revenue Service (IRS) to identify taxpayers who are required to file business tax returns.
• EIN’s are used by business entities that have no employees, as in the case of proprietorships, or those with employees, such as various types of corporations, partnerships, non-profits and other business entities.
• Important: Use your EIN in connection with your business activities only. Do not use your EIN in place of your social security number (SSN).

Learn more about obtaining an EIN

For more detailed understanding, specific need and use cases contact:

• The Mayor’s Business Action Team (MBAT)
•  A tax professional for business such as an attorney, accountant or certified public accountant (CPA)
• Visit the Internal Revenue Service (IRS) to learn more about IRS and EINs for businesses
• Call the IRS Business and Specialty Tax Line: 1-800-829-4933
  • TTY/TDD* users can call 1-800-829-4059

Register with the State

In Pennsylvania, the business tax license is obtained by registering with the Pennsylvania Department of Revenue. Here’s a step-by-step guide:

1. Determine If You Need to Register

You need a PA business tax license if you plan to:

• Sell taxable goods or services → you must register for Sales Tax.
• Hire employees → you must register for Employer Withholding Tax.
• Rent or lease tangible property → you may owe Sales/Use Tax.
• Owe other state business taxes (Gross Receipts, Use Tax, etc.)

What do I need to register?

In order to complete this business tax registration, you will need:

• The legal name of the business
• The name by which the business is doing business as (commonly known as, trading as, also known as), if applicable
• The Employer Identification number (EIN)
• Department of State Entity Number, if applicable
• The business addresses and contact information
• The name(s), home address(es) and Social Security Number or Individual Taxpayer Identification Number of the owners/officers/other responsible parties.

If you’ve received a Notice of Required Registration letter from the department, make sure to have the Letter ID readily available.

2. Register Online (Fastest)

1. Go to PA Department of Revenue – myPATH.
2. Select “Register a new entity”.
3. Fill out the PA Enterprise Registration (Form PA-100) and submit electronically through the portal. Form PA-100 registers you for all applicable state business taxes in one step (sales tax, employer withholding, unemployment compensation, etc.).
4. Receive Your Tax Account ID & License Once processed, the Department of Revenue will issue you a Revenue ID and any applicable tax licenses.

How to Register by Mail (Slower Option)

1. Download Form PA-100 (Enterprise Registration Form) from the Department of Revenue.
2. Mail it to the address listed on the form.
3. Processing usually takes several weeks.

Register your business with the City of Philadelphia

In Pennsylvania, you register your business with the Pennsylvania Department of State, Bureau of Corporations and Charitable Organizations (BCCO). (COLLECTIONS)

Core Requirements

• Register for a Philadelphia Business Tax Account ID
• Obtain Philadelphia Commercial Activities License – free
• Required for *ALL* businesses operating in Philadelphia
• No need to renew. A onetime application.
• Use Permit Navigator for registration needs
• Call Philadelphia Business Services (215) 686-2085 with any questions

Prerequisite Info

You will need:

• To know your business structure. This will be the same business structure you chose and registered with the Commonwealth of Pennsylvania
• Your EIN – Employer Identification Number, assigned to and issued by the IRS – Internal Revenue Service, to the named corporation you registered with the Commonwealth of Pennsylvania
• Your Social Security Number – Only if your business is being registered as an individual or limited liability individual (not a limited liability corporation – LLC)

Here are the main ways to do it:

• Online Registration (Preferred)
  • Head to the Pennsylvania Business One-Stop Shop:business.pa.gov
  • The site walks you through choosing your structure (LLC, corporation, partnership, sole proprietorship with a fictitious name, etc.) and filing the correct forms.
  • You’ll use the Pennsylvania Department of State’s online filing system to submit formation documents, fictitious name registrations, or other filings.

• Paper Filing:
  • You can also file by mail with the Department of State, Bureau of Corporations and Charitable Organizations in Harrisburg.
    • Mailing address:
      Pennsylvania Department of State,
      Bureau of Corporations and Charitable Organizations,
      401 North Street,
      Room 206,
      Harrisburg, PA 17120
• Paper forms are available on dos.pa.gov.
• Register for state taxes with the Pennsylvania Department of Revenue if required (sales tax, employer withholding, etc.).
• Check for licenses or permits through the PA Licensing System (PALS) or local municipalities depending on your business type.

PHILADELPHIA BUSINESS TAXES YOU MUST KNOW ABOUT

1. Business Income and Receipts Tax (BIRT)

• Applies to: All businesses operating in Philadelphia (including home-based, online, and side hustles).
• Covers:
  • Gross Receipts Portion: A small tax on total revenues.
  • Net Income Portion: A tax on your net profits.
• Rates (2025):
  • Gross Receipts: 0.1415%
  • Net Income: 5.81%

2. Net Profits Tax (NPT)

• Applies to: Sole proprietors, partnerships, LLC members (if not taxed as corporations).
• Rates:

• Residents: 3.75% of net profits.
• Non-residents: 3.44% (only on income earned

Zoning, Permits & Compliance

The City of Philadelphia offers a Permit Navigator where you can learn about the various permits and licenses needed to operate a business in the city.

Core Requirements

• Verify Zoning Compliance
  • Confirm your business type is allowed at your location
  • Address any zoning issues before signing lease
  • Check at: [Philadelphia Zoning Information] or call (215) 686-0442
  • Timeline: 1-3 days for verification, longer for appeals
• Obtain Certificate of Occupancy (if required)
  • Required for most commercial spaces
  • Confirms space meets safety and zoning requirements
  • Required before opening to public
  • Apply through Philadelphia Permit Navigator or call (215) 686-2463
  • Timeline: 2-4 weeks

Open A Business Bank Account

As soon as possible, a small business should open a business bank account to keep personal and business finances separate, which protects personal assets, simplifies accounting and taxes, and preserves legal liability protections for LLCs or corporations. It also builds professionalism by allowing payments in the business’s name, makes it easier to secure loans or credit, and provides cleaner financial records that help manage cash flow and support growth.

To open a business bank account, most banks require: your business formation documents (e.g., Articles of Organization or Incorporation), your EIN (Employer Identification Number) from the IRS (or Social Security number if you’re a sole proprietor), a valid photo ID for the business owner(s), your business license or registration (such as a PA Commercial Activity License), and your operating agreement or partnership agreement if applicable. Some banks may also ask for proof of address (like a utility bill or lease) and a minimum opening deposit.

You may want to compare the benefits of different bank branches, however it is often optimal to open a business account where you hold a personal account to facilitate owner distributions more easily.

Core Requirements

• EIN letter
• Articles of Formation / Organization
• Fictitious name or DBA paperwork if applicable
• Photo ID
• Operating agreement or partnership agreement

Obtain Insurance

WHAT BUSINESS or PROFESSIONAL INSURANCE DO I NEED?

What is optional?

A good starting point is to contact a local insurance broker (for tailored advice) and also check an online marketplace for quick ballpark pricing.

You can shop for business insurance in several places, depending on your needs and budget:

• Local Insurance Agents & Brokers – Independent brokers can compare policies from multiple carriers and help tailor coverage (e.g., general liability, property, workers’ comp, professional liability). This is often best for small businesses that want personal guidance.
• Major National Carriers – Larger insurance companies often offer small business packages. You can get quotes directly from their websites or through agents.
• Online Marketplaces & Insurtechs – Platforms such as Hiscox, NEXT Insurance, CoverWallet, Simply Business, or Policygenius make it easy to compare quotes online and buy coverage quickly. These are great for freelancers, consultants, or very small businesses.
• Industry Associations or Chambers of Commerce – Some offer group insurance rates or partnerships with insurers for member businesses.
• Specialized Providers – If you’re in a regulated industry (construction, health care, food service, etc.), you may need coverage from niche carriers that understand your risks.

General Liability Insurance

• Typically a minimum $1 million coverage recommended
• Required by most landlords and contracts
• May protect against customer injury claims
• Get quotes: [Philadelphia Business Insurance Directory]

Professional Liability Insurance

• Optional for professional services
• Covers errors and omissions
• Industry-specific coverage available
• Consult: Insurance agent specializing in your industry

Set Up Workers’ Compensation (if hiring employees)

• Required by law for businesses with employees
• Covers workplace injuries
• Must be in place before first employee starts
• Information: [PA Workers’ Compensation] or call (717) 787-5279

Contact  MBAT for tips, insights and one on one support. – If you’re in a regulated industry (construction, health care, food service, etc.), you may need coverage from niche carriers that understand your risks.

General Liability Insurance

• Typically a minimum $1 million coverage recommended
• Required by most landlords and contracts
• May protect against customer injury claims
• Get quotes: [Philadelphia Business Insurance Directory]

Professional Liability Insurance

• Optional for professional services
• Covers errors and omissions
• Industry-specific coverage available
• Consult: Insurance agent specializing in your industry

Set Up Workers’ Compensation (if hiring employees)

• Required by law for businesses with employees
• Covers workplace injuries
• Must be in place before first employee starts
• Information: [PA Workers’ Compensation] or call (717) 787-5279
• Contact MBAT for tips, insights and one on one support.