TL;DR
In many places, you can run a business as a minor, but formal registration and related financial arrangements may require a parent, guardian, or another legally eligible adult. Some jurisdictions restrict who can form or manage an LLC, and the rules for signing contracts are a separate issue. Many small teen projects don't need to form a company immediately, although licenses, tax obligations, or local registrations may still apply. Before filing anything, check your own state or country's official requirements and determine whether registration is necessary.
Starting a business as a teenager can help you turn an idea into a product or service people actually use. You might be selling handmade products, building an app, tutoring, or running a small online store.
Once you start taking payments or thinking about registering a company, though, the questions get harder. You can start building a business before you turn 18, but formally registering and running one comes with legal rules that depend on where you live.
What will this guide help you understand?
This guide helps you figure out whether you need to register, how to do it, and where an adult may need to step in. You'll learn:
How common business structures work
Where to check the rules in your state or country
What a parent or guardian may need to do
How banking and taxes fit into the process
You'll also find a six-step registration guide and answers to common questions about LLCs, employer identification numbers, and owning a business before 18.
The goal is to keep you from spending money on paperwork before you know you need it. If you're still exploring your first venture, our guides to online small business ideas for teens and startup incubators for high school students can help you test an idea first.
Do you actually need to register your business?
You don't always need to register a formal company to start a small business, but you may still need licenses, permits, or tax registrations. For many teens, the first step is figuring out whether formal registration applies to them at all.
In the U.S., a business owned and run by one person may be treated as a sole proprietorship without a separate formation filing. The U.S. Small Business Administration (SBA) explains that sole proprietorships generally don't need to register with a state just to exist, though trade-name registration and other rules may apply.
That doesn't mean you can skip all paperwork. Depending on where you live and what you sell:
Your city or county might require a business license
Your state might require sales tax registration
Your online marketplace might require age and identity checks
When might formal registration become necessary?
It's worth revisiting registration once your business moves past testing an idea. That might happen when you:
Bring in co-founders
Look for investment
Hire workers
Sign significant business agreements
If you're developing your first business idea, Young Founders Lab can help you work through the early stages before you take on bigger responsibilities. Building something customers want is a better starting point than picking a company name and filing paperwork for an untested idea.
How old do you have to be to start an LLC?
In most U.S. states, there's no minimum age to own an LLC, but some states don't let anyone under 18 be the person who files the paperwork to create one. That person is called the organizer, and they don't have to be an owner.
There isn't one nationwide rule. Each state has its own laws on who can act as organizer, who can sign formation documents, and who can serve in management roles.
If your state won't let you be the organizer, you still have options. Nolo's guide to LLC age rules notes that nothing stops a minor from being a member, the legal word for an LLC owner. It also says most state LLC laws don't set an age for organizers at all, including California, Delaware, Nevada, and Wyoming. In a state that does set one, you could:
Have an adult file as the organizer while you're listed as a member
Form the LLC in a state without the restriction, then register it in the state where you live
Set the LLC up as manager-managed, so adult managers sign contracts and run daily operations while you stay an owner
A 6-step guide to registering a business as a minor
The safest order is to confirm you need to register, check the rules for your age and location, and only then file anything. The steps below describe a general process and use U.S. terms where relevant.
1. Decide whether your business needs formal registration
Start by asking whether your business needs a separate legal entity yet. If you're still testing an app, interviewing customers, or building a product, you may be fine without an LLC or corporation.
If you're already selling, check whether you need local licenses, tax registrations, trade-name filings, or other approvals, even without forming a company.
2. Check the rules in your state or country
Use official government sources to confirm whether someone your age can own, form, and manage the business you have in mind. In the U.S., start with your state's Secretary of State or equivalent filing office, then check local licensing rules.
If the published rules don't mention minors, contact the office directly. Ask specifically about organizers, members, registered agents, and who can sign documents.
3. Choose a business structure that fits your needs
Pick the structure that fits what your business actually does, not the one that sounds most professional. Compare a sole proprietorship, partnership, LLC, and corporation before you decide.
A sole proprietorship is generally simpler but doesn't create a separate legal entity.
An LLC or corporation requires formal formation and comes with ongoing obligations.
The right choice depends on your activities, liability risk, ownership plans, costs, and the laws where you live.
4. Decide who will be named in the registration documents
Figure out who can legally act as organizer, owner, manager, and registered agent before you submit anything. Depending on where you live, a parent, guardian, or another eligible adult may need to take one of these roles.
Make sure everyone understands what they're agreeing to. Naming an adult on a filing can create legal and financial obligations that go well beyond helping with paperwork.
5. Complete the required filings and check local permits
File your formation documents through your official government filing office, then get any licenses or permits your business needs. In the U.S., forming an LLC usually means filing articles of organization or an equivalent document with the state and paying a fee.
Also check for separate rules on:
Business names
Sales taxes
Home-based businesses
Regulated products
Local business licenses
6. Arrange banking, payments, and tax registration
Once your structure is set, figure out which tax numbers, accounts, and payment services you need. In the U.S., an employer identification number (EIN) may be required for some activities or requested by banks, but not every sole proprietor needs one.
If you're under 18, check the age rules for your bank and payment provider. Bring in an eligible adult where you need to.
What does a parent or guardian typically have to do?
A parent or guardian may need to help with contracts, financial accounts, or registration documents that you can't legally handle on your own. Their exact role depends on where you live, your business structure, and the institutions involved. Your parent might need to:
Review or sign certain agreements
Help with identity verification
Act in a legally recognized role for a financial service
In some cases, help form or manage the company
What should you discuss before asking for help?
Come to the conversation with a short explanation of your business and the specific help you need. These questions are a good place to start.
| Question | What you should clarify |
|---|---|
| What are you selling? | Your product or service and any applicable licensing requirements |
| Why do you want to register? | Whether registration is necessary for your current activities |
| Who will own the business? | The intended ownership arrangement and whether it is legally permitted |
| Who will sign documents? | Which agreements require an adult or authorized representative |
| Who will manage money? | How payments, refunds, expenses, and banking will work |
| Who will handle taxes? | What records you'll keep and whether professional assistance is needed |
| What happens when you turn 18? | Whether accounts, responsibilities, or ownership arrangements need review |
Also talk through what happens if the business loses money or gets a customer complaint. If your parent is taking on contract or money responsibilities, they need to understand those risks before signing anything.
A good first step is to help check the rules, not asking your parent to register a company for you right away.
What happens with bank accounts and online payments?
You may be able to bank as a minor, but business accounts and payment processors often have their own age and identity rules. Opening a bank account isn't the same as getting approved for a payment-processing account.
Some banks offer youth, joint, or custodial accounts. What's available, and who controls the account, depends on the bank and where you live.
These accounts aren't always meant for business transactions. A bank may also ask for business documents before opening an account for an LLC or corporation.
Frequently asked questions: registering a business as a minor
1. Can a 16-year-old own an LLC?
A 16-year-old may be able to own part of an LLC, but whether they can form or manage one alone depends on state law. Owning an LLC interest, acting as its organizer, and signing binding contracts are separate legal questions. Some states or filing procedures limit who can submit formation documents or hold certain roles. Check your state's official filing guidance, and talk to a qualified business attorney if you need help reading the rules.
2. Do you need to register a small business as a teenager?
You don't always need to form a company to run a small business, but you may need licenses, permits, tax registrations, or a trade-name filing. Selling digital products or tutoring, for example, might not require an LLC right away. That doesn't make the activity exempt from local business rules or taxes. Check your government's business portal to see what applies to your product or service.
3. Can a minor get an EIN?
Yes, the IRS states that there's no legal minimum age to be issued an EIN. The application still has to meet the IRS's identification and responsible-party rules, and the IRS's internal guidance sets extra requirements involving a parent or guardian's Social Security number for minors. An EIN is only a tax ID number. It doesn't create a business entity or give you the legal ability to sign contracts.
4. Do you need a parent to register a business before turning 18?
You may need a parent, guardian, or another eligible adult for certain registration, contract, or financial steps, but there's no single rule for every minor. The answer depends on your state or country's laws and the roles involved. Even if you can own part of a business, a bank or payment provider may still require an adult. Pin down the exact requirement before deciding what role your parent needs to take.
5. What is the simplest business structure for a teenager?
A sole proprietorship is often the simplest option for a one-person U.S. business, since it generally doesn't need a separate state filing to exist. You may still need licenses, permits, tax registrations, or trade-name filings. A sole proprietorship also doesn't protect your personal assets from business debts or claims. An LLC may offer that protection in the right situations, but it comes with formation costs and ongoing responsibilities, so compare options based on your actual business.
6. Do you have to pay taxes if you're under 18 and running a business?
Yes, you may have to pay taxes on business income even if you're under 18. In the U.S., the IRS generally requires a federal tax return once your net earnings from self-employment reach $400, though other filing rules and exceptions may apply. Track your income and expenses from the start. Also check whether sales taxes, state taxes, or other obligations apply to you.
If you're still deciding what kind of business to build, Young Founders Lab can help you develop and test an idea before you take on formal registration. Understanding your customers and testing your business model will help you decide whether a legal entity is worth it.