How to Register a Business in North Carolina in 9 Steps

Starting a business in the Tar Heel State can feel overwhelming, but it doesn’t have to be. While the paperwork and legal requirements might seem daunting, registering your business is a crucial first step toward long-term success. This guide breaks down the process into nine straightforward steps, helping you get started with confidence.

Remember that specific rules and fees can change depending on your business type, location, and industry. Always consult official state resources like the North Carolina Secretary of State, the North Carolina Department of Revenue, and your local county clerk’s office to ensure you meet all legal requirements.

Table of Contents

Step 1: Choose Your Business Structure

Selecting the right structure is a foundational decision that impacts your personal liability, taxes, and how your business will operate in North Carolina. Here’s a quick look at the most common types:

Sole Proprietorship

The simplest and most common structure for one-person businesses. You can operate under your own name without state registration. If you use a different business name, you must file an Assumed Business Name certificate with your county’s Register of Deeds.

Liability: You have unlimited personal liability, meaning your personal assets are at risk for business debts and lawsuits.
Taxes: All income and expenses are reported on your personal tax return.

Partnership

A business owned by two or more people. A general partnership doesn’t require state filing, but like a sole proprietorship, you must file an Assumed Business Name certificate if you’re not using the partners’ surnames. Formal partnerships, like Limited Partnerships (LPs) or Limited Liability Partnerships (LLPs), must register with the NC Secretary of State.

Liability: In a general partnership, all partners share unlimited personal liability. LPs and LLPs provide varying levels of protection.
Taxes: Partnerships don’t pay income tax directly; profits and losses “pass through” to each partner’s personal return.

Limited Liability Company (LLC)

A popular choice in North Carolina for its balance of personal liability protection and flexible tax options. You must file Articles of Organization with the NC Secretary of State to create your business.

Liability: Your personal assets are protected from most business debts and claims.
Taxes: By default, an LLC is taxed as a pass-through entity, but it can elect to be taxed as a corporation.

Corporation

A more complex structure that creates a legal entity separate from its owners (shareholders). To form a corporation, you must file Articles of Incorporation with the NC Secretary of State.

Liability: This structure provides the strongest personal liability protection, completely separating owners from business obligations.
Taxes: C Corporations are subject to “double taxation”, profits are taxed at the corporate level and again when paid out as dividends. S Corporations avoid this by passing profits and losses directly to shareholders.

Step 2: Choose and Secure a Business Name

Your business will have an official legal name (for formal entities like LLCs and corporations) and, optionally, an Assumed Business Name for public use.

To check if your legal name is available, use the free online search on the North Carolina Secretary of State’s Business Registration Division database. You can also reserve a name for 120 days for a $30 fee.

If you plan to use an Assumed Business Name, you must file a certificate with the Register of Deeds in the county where your business is located. The fee for this filing is a standard $26, not a variable one.

For nationwide brand protection, consider a trademark search with the U.S. Patent and Trademark Office (USPTO).

Step 3: Draft Your Business Formation Documents

The documents you need to draft depend on your chosen structure.

LLC: You must file Articles of Organization with the state. It’s also strongly recommended to create an internal Operating Agreement to define ownership, duties, and decision-making processes.
Corporation: You need to file Articles of Incorporation with the state. You should also draft internal corporate bylaws to govern the company’s rules and operations.
Partnership: A private, internal Partnership Agreement is crucial for defining partner roles, responsibilities, and profit-sharing arrangements.

Step 4: Register with the State of North Carolina

Once you have your documents, you’ll file them with the state to make your business a legal entity. This step is required for formal structures like LLCs and corporations.

Filing with the North Carolina Secretary of State:

LLCs: You’ll file Articles of Organization. This document establishes your LLC’s existence and contains essential information like the business name and the name and address of your registered agent. The online filing fee for an LLC is $125.
Corporations: You’ll file Articles of Incorporation, which include details about your corporate name, the number of authorized shares, and your registered agent. The filing fee is also $125.

Online filings with the North Carolina Secretary of State are typically processed within a few business days. Mail-in filings can take longer. If you’re in a hurry, North Carolina offers expedited processing for an additional fee, which can reduce the timeline significantly.

Step 5: Obtain an Employer Identification Number (EIN)

In North Carolina, most businesses will need an Employer Identification Number (EIN), a nine-digit ID from the IRS that works like a Social Security number for your business. You’ll use it for hiring employees, opening a business bank account, filing federal taxes, and applying for certain licenses or permits.

Sole proprietors without employees can use their Social Security number instead, but many still get an EIN for privacy and to keep personal and business finances separate. Applying is free through the IRS website, takes just a few minutes, and you’ll get your EIN immediately after completing the online form.

Step 6: Apply for Licenses and Permits

Legally operating your business in North Carolina requires the right licenses and permits from federal, state, and local governments.

Federal Licenses and Permits: Most small businesses in North Carolina won’t need a federal license, but industries like alcohol sales, firearms, and transportation are regulated nationally.
State Licenses and Permits: North Carolina does not have a general state business license. However, you must register for a Sales and Use Tax account with the North Carolina Department of Revenue if you sell taxable goods or services. Many professions also require specific licenses from state boards.
Local Licenses and Permits: Your city or county may require a business license, but fees have been eliminated for many general business activities. You may still need permits for zoning, health, or specific activities like selling alcohol.

Step 7: Open a Business Bank Account

A dedicated business bank account is essential for protecting your personal assets and simplifying your accounting. When you visit the bank, you’ll typically need your EIN, business formation documents (like Articles of Organization), and a government-issued photo ID.

You should also be prepared to provide a copy of your Operating Agreement or Corporate Bylaws, as some banks require these to verify ownership and authorized signers. For home-based businesses, be ready to show proof of your business address, such as a utility bill or lease agreement.

Having a separate account helps maintain the “corporate veil” for LLCs and corporations, ensuring your personal and business finances are not mixed, which could otherwise expose your personal assets to business liabilities. This separation also makes it easier to track income and expenses for both state and federal tax filings.

Step 8: Register for State and Federal Taxes

Your business’s tax obligations depend on its structure.

Federal Taxes

Pass-through entities like sole proprietorships and partnerships report income on the owner’s personal tax return. Corporations pay corporate income tax, and C corporations are subject to double taxation.

North Carolina State Taxes

You’ll likely need to register with the North Carolina Department of Revenue for:

Sales and Use Tax: Required if you sell taxable goods or services.
Corporate Income Tax & Franchise Tax: Corporations and LLCs taxed as corporations are subject to a corporate income tax and an annual franchise tax. The minimum franchise tax is $200 only if taxed as a C or S Corporation.
Individual Income Tax: Pass-through entities are subject to North Carolina’s flat-rate individual income tax.
Withholding Tax: Required if you have employees.

Step 9: Maintain Ongoing Compliance

Registering your business is just the beginning. To stay compliant, you must handle ongoing responsibilities.

File the Annual Report: File the Annual Report: The annual report filing fee for a corporation is $25 for a paper filing or $20 for an online filing. The annual report filing fee for an LLC is $200 for a paper filing or $203 for an online filing. Failing to file can result in penalties and administrative dissolution.
Renew Licenses and Permits: Keep track of renewal deadlines to avoid fines.
Maintain a Registered Agent: Your business must have a registered agent with a physical address in North Carolina to receive legal documents.
Keep Records Organized: Maintain accurate financial records and other required documentation to ensure smooth operations and protect your liability shield.

Frequently Asked Questions

Starting a business in North Carolina is exciting, but it’s natural to have questions about costs, timelines, and whether you need professional help.

How Much Does It Cost to Register a Business in North Carolina?

The cost depends on your chosen business structure. For example, forming an LLC or corporation in North Carolina requires a $125 filing fee with the Secretary of State. You should also budget for a registered agent (often $50-$150 annually) and a yearly annual report fee ($200 for LLCs, $25 for corporations). While many local business licenses have had their fees eliminated, some industries may still have fees, which can range from a nominal amount to several hundred dollars, depending on your city or county. In total, expect to spend between $200 and $1,000+ for the initial setup.

How Long Does It Take to Register a Business in North Carolina?

Do I Need a Lawyer to Start a Business in North Carolina?

You’re not legally required to hire a lawyer. However, legal guidance can be valuable, especially if your business has multiple owners, complex agreements, or will operate in a highly regulated industry. An attorney can help you choose the best business structure, prepare customized operating documents, and ensure compliance with North Carolina laws. For simpler setups, like a sole proprietorship or a single-member LLC, many business owners handle the process themselves using online resources.

Conclusion – How to Register a Business in North Carolina

Navigating the business registration process in North Carolina doesn’t have to be overwhelming. By following the right steps, you can establish a solid legal foundation for your venture.

Proper registration isn’t just paperwork. It’s a crucial move toward safeguarding your personal assets, building trust with customers, and positioning your business for long-term success.

Taking the time to get it right from the start can save you from costly legal and financial problems down the road, allowing you to focus on what matters: growing your North Carolina business.