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How to Start a Business in Connecticut

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Connecticut might be the third smallest U.S. state by area, but it is the fourth most densely populated. Known as the “Nutmeg State,” much of southern and western Connecticut (along with the majority of the state’s population) is part of the New York metropolitan area. Rich with historical districts, parks, and autumn foliage you can’t beat, Connecticut offers a good range of tax and business incentives for the new business owner.

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How to Start a Business

Starting a business can be both exhilarating and challenging. It requires your full attention and energy. It all begins with an idea, an observation that there is a problem and the belief that you have a new solution – or a better one. Allow us to walk you through the steps in this free guide: How to Start A Business.

General resources for starting a business in Connecticut

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Fun facts about starting a business in Connecticut

Famous business founded in Connecticut: Bigelow Tea Company

Bigelow is an American tea company founded and based in Fairfield, Connecticut. It was founded by Ruth C. Bigelow in the late 1940s, based on a recipe she marketed as “Constant Comment” tea. Bigelow is still a 100% family-owned business that markets over fifty varieties of tea, all of which are still blended in Fairfield.

Famous entrepreneur born in Connecticut: P.T. Barnum

P.T. Barnum was an American showman and businessman remembered for promoting celebrated hoaxes and for founding the Barnum & Bailey Circus. He was born in Bethel, Connecticut.

“The noblest art is that of making others happy.” — P.T. Barnum

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Which type of legal structure is best for my business in Connecticut?

We strongly recommend you incorporate, but you must consider the tax, legal, and liability implications carefully before deciding on the best structure.

Here are 5 helpful steps to determine what is the best legal structure for your business:

Click one of the buttons below to learn more about the different types of business legal structures and how to start them in the state of Connecticut.
LLC (Limited Liability Company)
An LLC is the United States-specific form of a private limited company. It is a business structure that combines the pass-through taxation of a partnership or sole proprietorship with the limited liability of a corporation.

Steps to starting an LLC in Connecticut:

  • Step 1 — Name for your LLC.
  • Step 2 — File an Articles of Organization.
  • Step 3 — Appoint a Registered Agent.
  • Step 4 — Prepare an Operating Agreement.
  • Step 5 — Comply with necessary publication requirements.
  • Step 6 — Comply with other tax and regulatory requirements.
  • Step 7 — Pay your state taxes.
  • Step 8 — File Annual Reports.
  • Step 9 — Register foreign LLCs doing business in Connecticut.

For help forming your LLC in Connecticut we recommend CorpNet (they have fees for their service). Alternatively, visit the Connecticut Secretary of State website.

Other Connecticut resources for LLCs:

Secretary of State Business Name Database: Search for your LLC name here.
Reserve your LLC name here.

Secretary of State Forms: File your Articles of Organization here.
File your Annual Reports here.

Connecticut Department of Revenue Services: Register here if you have employees.

Business Entity Tax: Connecticut also imposes a separate annual Business Entity Tax.

IRS EIN Online: Apply for an Employer Identification Number (EIN) for your LLC. If your LLC has more than one member, even if it has no employees, you will need an EIN.

CT’s Business Response Center: A comprehensive database of every license and permit that may be required by your LLC.

Connecticut Department of Labor: Register here if you will hire employees.

Sole Proprietorship
A sole proprietorship is an unincorporated business with one owner who pays personal income tax on profits from the business. With little government regulation, they are the simplest business to set up or take apart, making them popular among individual self contractors or business owners.

Steps to starting Sole Proprietorship in Connecticut:

  • Step 1 — Choose a business name.
  • Step 2 — File a trade name with the town clerk.
  • Step 3 — Obtain licenses, permits, and zoning clearance.
  • Step 4 — Get an Employer Identification Number (EIN).

For help forming your sole proprietorship in Connecticut we recommend CorpNet (they have fees for their service).
Alternatively, visit the Connecticut Secretary of State website.

Other Connecticut resources for Sole Proprietorship:

Secretary of State Business Name Database: Search for your fictitious business name here. You can also use your own given name for your business name.

U.S. Patent & Trademark Office: Federal site for your business name search. Click on the “TESS” link.

State of Connecticut website: Links to the various towns and cities where you can get specific information from your town clerk, to file your trade name.

CT’s Business Response Center: A comprehensive database of every license and permit that may be required by your sole proprietorship.

IRS EIN Online: Apply for an Employer Identification Number (EIN) for your business. If you have employees, you will need an EIN.

Connecticut Department of Labor: Register here if you hire employees.

Connecticut Department of Revenue Services: Register with this site if you will be selling goods or collecting sales tax, or if you have employees.

Business Entity Tax: Connecticut also imposes a separate biennial Business Entity Tax.

Partnership
A partnership is created whenever two or more people do business together for profit and share ownership, even if there is no written agreement to form the partnership. Each partner contributes to all aspects of the business, and each partner shares in the profits and losses of the business.

Steps to starting Partnership in Connecticut:

  • Step 1 — Choose a business name.
  • Step 2 — File a Trade Name.
  • Step 3 — Create and sign a partnership agreement.
  • Step 4 — Obtain licenses, permits, and zoning clearance.
  • Step 5 — Obtain an Employer Identification Number (EIN).

For help forming your partnership in Connecticut we recommend CorpNet (there are fees for their service). Alternatively visit the Connecticut Secretary of State website.

Other Connecticut resources for Partnership:

Secretary of State Business Name Database: Search for your fictitious business name here. You can also use the surnames of the individual partners.

U.S. Patent & Trademark Office: Federal site for your business name search. Click on the “TESS” link.

State of Connecticut website: Links to the various towns and cities where you can get specific information from your town clerk, to file your trade name. This must be filed prior to your business start date.

CT’s Business Response Center: A comprehensive database of every license and permit that may be required by your partnership.

IRS EIN Online: Apply for an Employer Identification Number (EIN) here. You must have an EIN regardless of whether or not you have employees.

Connecticut Department of Labor: Register here if you hire employees.

Connecticut Department of Revenue Services: Register with this site if you will be selling goods or collecting sales tax, or if you have employees.

Business Entity Tax: Connecticut also imposes a separate biennial Business Entity Tax.

S Corporation
An S corporation (sometimes referred to as an S Corp), is a special type of corporation created through an IRS tax election. An eligible domestic corporation can avoid double taxation (once to the corporation and again to the shareholders) by electing to be treated as an S corporation. In general, S corporations do not pay any federal income taxes. Instead, the corporation's income or losses are divided among and passed through to its shareholders. The shareholders must then report the income or loss on their own individual income tax returns.

Steps to starting S Corporation in Connecticut:

  • Step 1 — Name your corporation.
  • Step 2 — Prepare and file a Certificate of Incorporation.
  • Step 3 — Appoint a Registered Agent.
  • Step 4 — Set up a corporate records book.
  • Step 5 — Prepare corporate bylaws.
  • Step 6 — Appoint initial corporate directors.
  • Step 7 — Hold your first Board of Directors meeting.
  • Step 8 — Issue stock.
  • Step 9 — File Annual Reports.
  • Step 10 — Comply with state tax and regulatory requirements.
  • Step 11 — Comply with other tax and regulatory requirements.
  • Step 12 — Register foreign corporations doing business in Connecticut.

For help forming your S corporation in Connecticut we recommend CorpNet (they have fees for their service). Alternatively you can visit the Connecticut Secretary of State website.

Other Connecticut resources for S Corporation:

Secretary of State Business Name Database: Search for your corporate name here.
Reserve your name here.

Secretary of State Forms: File your Certificate of Incorporation, and your Organization and First Report here.

Connecticut Department of Revenue Services: Register here before doing business in this state.

Business Entity Tax: Connecticut also imposes a separate annual Business Entity Tax.

IRS EIN Online: Apply for an Employer Identification Number (EIN) for your corporation.

IRS S corporations: Specific instructions for your tax requirements as an S corp.

CT’s Business Response Center: A comprehensive database of every license and permit that may be required by your corporation.

C Corporation
A C corporation, under United States federal income tax law, refers to any corporation that is taxed separately from its owners. A C corporation is distinguished from an S corporation, which generally is not taxed separately.

Steps to starting C Corporation in Connecticut:

  • Step 1 — Choose a corporate name.
  • Step 2 — Prepare and file Certificate of Incorporation.
  • Step 3 — Find a Registered Agent.
  • Step 4 — Set up a corporate records book.
  • Step 5 — Prepare corporate bylaws.
  • Step 6 — Appoint initial corporate directors.
  • Step 7 — Hold your first Board of Directors meeting.
  • Step 8 — Issue stock.
  • Step 9 — File Annual Reports.
  • Step 10 — Comply with state tax and regulatory requirements.
  • Step 11 — Comply with other tax and regulatory requirements.
  • Step 12 — Register foreign corporations doing business in Connecticut.

For help forming your C corporation in Connecticut we recommend CorpNet (they have fees for their service). Alternatively, you can visit the Connecticut Secretary of State website.

Other Connecticut resources for C Corporation:

Secretary of State Business Name Database: Search for your corporate name here.
Reserve your name here.

Secretary of State Forms: File your Certificate of Incorporation, and your Organization and First Report here.

Connecticut Department of Revenue Services: Register here before doing business in this state.

Business Entity Tax: Connecticut also imposes a separate annual Business Entity Tax.

IRS EIN Online: Apply for an Employer Identification Number (EIN) for your corporation.

CT’s Business Response Center: A comprehensive database of every license and permit that may be required by your corporation.

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Why choose Connecticut for my business?

  • 1

    Connecticut Business Tax Credits
    Tax credits for new businesses in Connecticut.

  • 2

    Connecticut Innovations
    “Today, CI is the leading source of financing and ongoing support for Connecticut’s innovative, growing companies. With the addition of our Small Business Innovation Team in 2009 and our merger with the Connecticut Development Authority—the state’s lender—in 2012, CI now proudly serves great Connecticut companies, no matter what stage of growth they’re in.”

  • 3

    Small Business Financial Assistance
    “State programs include direct funding from the Department of Economic and Community Development (DECD) and Connecticut Innovations (CI). In addition, there is a network of local and regional revolving loan funds across the state to assist businesses with financing needs.”

  • 4

    Financial Opportunities for Minority or Women-Owned Businesses
    From Connecticut’s official state website.

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