Starting a Business in Louisiana: 8 Essential Steps

This article will help you start a business in Louisiana. While it’s not a top-ranked economy, the Bayou State draws over half of its employment from small companies.[1], [2] To start you on the right track, we’ll take you step-by-step through the incorporation process for a new Louisiana business. Soon, you’ll have the independence enjoyed by small business owners all over Louisiana.

Start Operating in Louisiana: Key Points

• Nearly 54 percent of Louisiana jobs come from small businesses.

• It costs between $75 and $100 to start a small business in Louisiana, and mistakes on forms can result in setbacks and lost filing fees.[3] 

• To start operating in Louisiana, companies need to register with the Louisiana Secretary of State, register to pay taxes, and apply for the proper business licenses and permits.

Ready to Start a Louisiana Business?

In this article, you’ll find all the information you need to start operating in Louisiana, from choosing a business name to the incorporation paperwork and knowing what taxes and licenses you need. If you read up on setting up a business in Louisiana, you’ll save your small business and your fellow business owners a lot of headaches down the road.

1. Choose a Business Idea

If you’re dead set on starting a business in Louisiana but still need a business idea, that’s okay. Entrepreneurs often begin with a simple desire for the independence and thrill of owning a new business. Here are some ideas to generate some spark.

For business owners who already have their product or service in mind, many of the techniques above can help you find your “special sauce” or angle on your industry so you’ll be ready to do things your way.

• Insight happens through conversation. Go places and ask questions.

• Take note of your struggles and observations. Journal, meditate, and brainstorm. 

• Educate yourself. Try a class, read some books, and do a lot of research.

• Travel — maybe to a part of Louisiana you’ve never visited — for a fresh perspective.

• A green business will always be in style from here on out. Here are some eco-friendly ideas.

• Do you want to get started and not worry about inspiration? Here are some evergreen, ready-to-go small business ideas for recent college grads.

2. Draft a Louisiana Business Plan

Your business plan provides answers to critical questions that you’ll need to figure out before you start operating in Louisiana. Every new business should write one, and it’s not as difficult as it sounds. Here’s an outline to get you going. This article has more. 

How to Structure Your Business Plan

Why You Need a Business Plan

Suppose you continue the business formation process without researching your target market, competition, and sales targets to profitability. In that case, you’re bound to encounter problems as a startup that you could have anticipated beforehand. 

Even if it changes the minute you start operating in Louisiana, every business needs a business plan to avoid fatal mistakes. 

3. Select a Business Name

Choosing your business name is one of the most critical choices you’ll make while starting a business in Louisiana. Customers and partners will know you by name first and your products and services next. And we all know the significance of first impressions.

A business name, first and foremost, needs to fit these simple criteria:

1. It has to be short and intuitive to pronounce. Good business ideas aren’t worth much if you can’t find a name that travels by word of mouth.

2. It should convey both what your business does and give your customer a sense of your character as a business — whether professional, approachable, fast, elite, trustworthy, or fun.

3. It would be best if you had a website domain name and social media handles that match the business name you’ve chosen so you can execute your marketing plan.

But equally important for the business formation process, your business name has to be available in the state of Louisiana. 

Available Louisiana Business Names

To check name availability, conduct a Louisiana business search on the Secretary of State website or use Swyft Filings’ Free Business Name Search tool. Your business name has to be phonetically different from other registered businesses, and it can’t just have a different spelling, either.[4]

When You Find the Perfect Business Name

Suppose you found the ideal business name, but you’re not ready for incorporation. In that case, you can file a name reservation for $25 to reserve your preferred name for 120 days. Then, you can focus on the other details and not rush into starting a business in Louisiana.

Remember: Your official business name doesn’t have to be the one you use to do business. You are free to register a “doing business as,” or DBA, that allows you to use a different name for storefronts and facing customers. At the same time, you keep another business name on file with the Secretary of State. In Louisiana, this is called a trade name. They cost $75 to register.

Swyft Filings can help you get a DBA for your business in a few clicks. 

4. Choose a Business Structure

As your startup embarks on the business formation stage, it’s essential to decide what business structure you will use for your business entity. Here’s a brief guide to the choices involved and the strengths and weaknesses of each. For more details, try this article.

• Limited liability company (LLC) 

  • Pros: 

    • Owners, called members, enjoy liability protections to protect their personal assets 

    • Members also avoid corporate income taxes, paying income tax for their company on their personal tax returns (this is called pass-through taxation)

    • LLCs are easy to manage, with no regulations on how they’re managed

  • Cons: 

    • Can’t sell shares or easily take on significant investments

    • It can be difficult to transfer ownership

• C Corporation

  • Pros:

    • Best liability protection

    • Easy to attract investors as shareholders

    • Robust structure that makes for stability and professionalism

  • Cons: 

    • High administrative burden, from incorporation to forming a board 

    • With more shareholders comes less control

    • Double taxation: the business entity will pay corporate income tax on profits and then personal income tax on your earnings

• Sole proprietorship (DBA)

  • Pros:

    • Ultimate startup flexibility, no setup, costs, or management

    • Do things entirely your way

    • Pass-through taxation

  • Cons:

    • No liability protections: a lawsuit against your business would put all of your personal assets at risk

    • No structure means you may lack professionalism in the eyes of partners

• Nonprofit

  • Pros:

    • Eligible for grants and tax-deductible donations

    • Exempt from income tax

    • Advances a social mission for the benefit of others

  • Cons:

    • Delicate qualification process

    • Need to form a board, high administrative burden

    • No big payouts for its owners

As you’re thinking through business structures, some startups will want to contemplate S Corporation status. While not a business structure, this federal tax status allows LLCs and C corps to potentially lower their tax burden. Learn more about S corp status here.

5. File Business Formation Documents

When you file your business formation documents online, you’ll use geauxBIZ, the Secretary of State’s online filing system. You can also mail your documents to the secretary of state’s office in Baton Rouge. You’ll use the same system to file your annual report in the years after.

The documents you need to file will depend on your chosen business structure. But first, you’ll need a Louisiana registered agent.

Louisiana Registered Agent

Your registered agent must be located in Louisiana with a brick-and-mortar office where they maintain regular business hours. This office is where legal documents will be delivered should your business be involved in a lawsuit. 

You can technically be your own registered agent. Still, a third-party service is affordable and can save you from embarrassing or catastrophic mishaps. For example, if you are served with a lawsuit in front of business partners or customers, or if you take a long weekend and miss a piece of critical legal correspondence. 

With Swyft Filings as your Louisiana registered agent, we contact you as soon as you need us and store your documents securely online for you to access.

LLC Business Formation Documents

You must file a business formation document known as the articles of organization to start an LLC in Louisiana. The document lists a few basic facts about your company: its name, location, and the name and address of the incorporator, along with your registered agent. When approved, you’ll get a certificate of organization (sometimes called a certificate of formation) from the Secretary of State.

After you file, an Operating Agreement is a great way to get you and your business partners on the same page. You and your LLC members will agree to ownership terms, frequency of meetings, hiring practices, and other nuts and bolts of how your business will be run.

C Corporation Business Formation Documents

To start a C corporation, you need to fill out articles of incorporation, which lists the names and addresses of your company, your registered agent, and the person filing the document, with other introductory details that the state of Louisiana will keep on file. Within 30 days of filing, you should receive a certificate of incorporation and a certified copy of your articles of incorporation.

After you file, your company needs to adopt a set of bylaws, which will lay out the structure and procedures for the company’s shareholders, board of directors, and officers. Swyft Filings can help you with bylaws if you don’t know where to start.

Filing Fees and the Cost of Mistakes

LLC articles of organization come with a filing fee of $100; for C corporations, the articles of incorporation filing fee is $75. These fees are non-refundable, and if your forms are rejected for even the smallest detail, you won’t get them back — and you’ll have to wait for the government to approve your next form when you re-file.

Letting Swyft Filings handle your business formation documents takes that risk out of the picture. It saves you hours of puzzling through paperwork. Whatever business you’re building, we can handle your incorporation and leave you to the critical work of building your business.

6. Apply for Louisiana Business Licenses and Permits

Your incorporation is a critical step to take before you start operating in Louisiana. But it’s just the beginning of a longer checklist. Licenses and permits are required from many different agencies for different kinds of small businesses. Make sure you research the following Louisiana business licenses:[5]

• Your city and parish government may require a general business license, including a certificate of occupancy, to assure that your type of business complies with zoning laws in your neighborhood.

• A food permit may be required from your city and or parish health department or other government agency if you handle, prepare, or serve food.

• Suppose you practice some licensed occupation, such as massage therapy, contracting, plumbing, or something else. In that case, you may be required to have an occupational license from the state or municipality where you do business.

• Some commodities with stricter regulations or special taxes require a permit from the state, such as tobacco, guns, beer, and liquor.

Business Insurance

While you’re getting your state and local licenses squared away, it’s a good time to research business insurance. General liability insurance for your business, as well as specific insurance that helps protect your Louisiana LLC or C corporation, could protect you from catastrophe, whether property damage or from a lawsuit. Having a corporation protects your personal liability, but not the business.

This business license checklist is a mountain of research you don’t have time to take on during the startup phase. So, let Swyft Filings get it done for you. Our fast and affordable Business Licenses and Research service pays back every penny in time and stress you’ll escape.

7. File and Report Business Taxes

Your business will owe Louisiana business taxes, so you should register with the Louisiana department of revenue soon after incorporation. When you formed your business, you received a state tax ID from geauxBIZ, so log back in if you need your tax information. Your annual tax returns will be due based on the fiscal year you specified during your incorporation.

Louisiana has a corporate income tax and a franchise tax that C corps must pay, but LLCs and sole proprietorships won’t. The income tax is a percentage of revenue, while the franchise tax is a percentage of capital employed in Louisiana.[6]

All businesses will owe federal tax to the IRS along with state sales tax and use tax, employment and payroll taxes if they hire employees, and varying taxes based on what they sell or what type of business they conduct. Consult the Louisiana Department of Revenue with any questions. They may also need to obtain workers’ compensation insurance.

8. Open a Business Bank Account

New business owners must open a bank account specifically for their business. Without a separate bank account, the limited liability your business structure affords you may not hold up in a court of law. It’ll make your life easier in several other ways, too, from accounting to work-life balance.

To start your business bank account, you’ll need to obtain a Federal employer identification number, or FEIN — often just called an employer identification number (EIN) — from the IRS. This is free, and you’ll need it for several other business operations beyond paying taxes and opening a bank account. It’s as crucial to your business as your social security number is to you.

Apply for an EIN for free on the IRS website or with Swyft Filings’ assistance.

Take Your First Steps Toward Small Business Ownership

The maze of paperwork and regulations you have to navigate to start a business in Louisiana may not be impossible to do by yourself—but is it worth it, when you have experts on hand to take care of it for you?

We recommend you enlist Swyft Filings in your business formation process. For a small line item in your budget, we get all the paperwork done for you with as little effort on your part as possible. In a fraction of the time it would take you by yourself, your startup will be fully compliant and ready to start operating in Louisiana.

Entrepreneurs have great business ideas. They’re smart enough not to get too bogged down in the details when the business needs them at the helm. Swyft Filings is the right choice to take the paperwork off your plate.

Frequently Asked Questions

Is Louisiana a good place to start a business?

Louisiana is not a booming economy, but it runs on small businesses. Even outside New Orleans and Baton Rouge, there’s plenty of opportunity to build a successful business in Louisiana.

How much does it cost to start operating in Louisiana?

It costs nothing for a sole proprietor to start operating in Louisiana but $75 to form a Louisiana corporation and $100 for a Louisiana LLC.

Can I start a business in Louisiana without a business plan?

You aren’t required to have a business plan to start a Louisiana business. Still, market research is imperative to any successful business, and investors will need incentives to loan you money. Your local small business administration (SBA) office offers free advice on your business plan.

What does Louisiana require to start a business?

Louisiana entrepreneurs must choose a legal business name and file incorporation documents with the Louisiana secretary of state, then apply for the proper business licenses and permits.

What is the process for starting a business in Louisiana?

First, complete your incorporation on geauxBIZ, then get your employer identification number (EIN) from the Internal Revenue Service (IRS). After you register for the proper taxes and licenses in the state of Louisiana, you’re ready to start operating your small business.

Why are most LLCs in Delaware?

Delaware has business-friendly laws that make it advantageous for large companies to headquart their LLCs in Delaware. Still, it’s almost always a better idea to start a business where you’re based.

Bibliography

1. CNBC. “Top States for Business 49. Louisiana.” Accessed July 28, 2023.

2. U.S. Small Business Administration Office of Advocacy. “2021 Small Business Profile.” Accessed July 28, 2023.

3. Louisiana Secretary of State. “Get Forms & Fee Schedule.” Accessed July 28, 2023.

4. Louisiana Secretary of State. “File Business Documents.” Accessed July 29, 2023.

5. Louisiana Small Business Administration. “Small Business Startup Kit.” Accessed July 29, 2023.

6. Louisiana Department of Revenue. “Corporation Income & Franchise Taxes.” Accessed July 29, 2023.