Tullahoma Guide to Starting a Business

Step 2: Establish a Legal Business Structure

How businesses are initially set up affects income taxes and levels of personal liability. If your business is to be established as a corporation, S corporation, limited liability company or partnership, you must first register with the Secretary of State's Corporate Legal Unit. You may also want to consult an attorney or tax accountant for more guidance.

When you complete your profile at Tennessee Smart Start, you will learn about the different types of business structures.

Secretary of State

Another resource is the Tennessee Secretary of State's website. Contact the Secretary of State regarding business filings and information by calling 615-741-2286.

Step 3: Choose a Location & Check Zoning Regulations

When considering where to set up your business, first determine the following:

• Will you have vendors or customers who come to you?
• Will your customers or vendors require parking or loading/unloading facilities?
• Will you have employees?
• Do you manufacture products for distribution or provide services?

Before finalizing any location plans or lease agreements, contact the City's Planning and Codes Department by calling 931-455-2282 to determine if your location is zoned for your type of business and verify if any special regulations are required. Obtain a home occupation permit if you plan to operate your business from home.

You may visit the Tullahoma Property Database to review location information as well.

Other Considerations

Evaluate the age of the building you're interested in with a view to change of use, fire inspection requirements and necessary environmental or health permits. Business owners may need to make tenant improvements to legally occupy older structures.

Carefully research the former use of the building and determine if the proposed business will require substantial tenant improvements to comply with the change of use.

Determine if an initial fire inspection plus semi-annual inspections are needed to be in legal compliance. Examples of businesses requiring semi-annual fire inspections are restaurants, auto painting businesses, hotels/motels and dry cleaners.

Restaurants and product-manufacturing businesses may need certain environmental permits.

Contacts & Resources

Resources to get you started:

• Planning and Codes Department page
  Phone: 931-455-2282
• City Recorder page
  Phone: 931-455-2648
• Business Tax License Zoning Ordinance and Fire Codes Acknowledgment (PDF)

Development Advisory Committee

Each Wednesday at 8 am, the City Host a Development Advisory Committee Meeting so that businesses can speak to the experts to learn about what is needed to get your business open. In one location, you meet with the:

• Building Inspector
• Economic Development
• Fire Chief
• Planning Director
• Public Works Director
• Utilities Representatives

Call the Planning office at 931-455-2282 to RSVP. We prefer advanced notice, but walk-ins are also welcome, too.

Some of the common information you will learn in a relaxed atmosphere with all the experts is:

• How many smoke detectors and fire extinguishers do I need?
• How many parking stalls are required?
• What type of landscaping is required?
• Do I need a grease trap?
• How do I get a sign permit?
• How will you dispose of your waste and recycling?

Step 4: Explore the Options for Financing a Business

Financing a start-up business may require personal savings, a second income stream (such as from a full- or part-time job), help from family and friends, personal belt-tightening or a combination. External sources of financing are also options and a worthwhile first stop is the Small Business Administration (SBA) or local bank to apply for capital. Many local banks and credit unions in the area are also SBA lenders.

The SBA offers two primary loan programs: The 7(a) loan program assists start-up and existing small businesses with working capital for a variety of general business purposes. The SBA does not itself make loans, but rather guarantees loans made by participating financial institutions. The SBA 504 program is typically managed through a local certified development corporation (CDC). CDCs work with the SBA and lenders to provide financing to small businesses with long-term, fixed-rate financing for land and buildings.

Other options for financing a business can include venture capital and angel investors for start-up and high-growth technology companies, industrial revenue bonds for manufacturers and research grants from the federal government.

Resources to Get You Started in Financing

Once you complete your profile at Tennessee Smart Start, there is a list of resources that includes the location of the nearest SBA office to venture capital firms.

The City of Tullahoma Finance department manages two business loan programs:

• Commercial loans for new business start-ups
• Expansion of current Tullahoma businesses

Please contact Sue Wilson at 931-455-2648 or visit the Finance Department page for more information.

Finally, visit the Pathway Lending website to learn more about their small business loan options.

Step 5: Obtain a Business License From the State, County & City

Guidelines and applications can be picked up at the City of Tullahoma Municipal Building located at 201 W Grundy Street.

Business License Resources

Rosemary Golden
City Recorder
Phone: 931-455-2648
City Recorder's Office Page

Step 6: Review the Hiring Process Before You Hire

Here are the basics:

Get a Tax Identification Number

If you intend to employ anyone outside of your immediate family, you must obtain an Employer Identification Number (EIN) from the Internal Revenue Service (IRS). The EIN is also known as the Employer Tax ID and may be obtained by completing form SS-4. Employers can apply for the EIN by calling 800-829-1040 (CALL) or online at the Tax Information for Businesses page.

Hiring employees also requires paying additional taxes and registering with the IRS.

Contact Social Security

Those who are self-employed and employers with one or more employees must pay Social Security taxes. Social Security information is available at 800-772-1213 or at the Employer W-2 Filing Instructions page.

Obtain Workers' Compensation Information

Workers' compensation insurance will be needed in the event an employee is injured on the job. The State Industrial Relations Department provides information and assistance to businesses regarding workers' compensation regulations and benefits.

Additional Assistance

For additional assistance regarding hiring, reach out to:
Tennessee American Job Center in Tullahoma
315 N Atlantic Street
Tullahoma, TN 37388
Phone: 931-454-1905
Tennessee American Job Center Website

Step 7: Tax Information Is Available From a Number of Sources

With limited exceptions, most businesses require an Employer Identification Number (EIN), also known as a Tax ID Number. An EIN is used to identify a business in its federal tax filings. Without an EIN, you can't hire employees or open a business bank account. Visit the EIN Assistant page to obtain an EIN.

Tennessee Taxes

You should also be aware of important Tennessee taxes that may apply to your business:

• If you are selling a physical product, you'll typically need to register for Tennessee Sales Tax.
• If you hire employees in Tennessee, you will have to register for Unemployment Insurance Tax on behalf of your employees.

Now you are ready to open a bank account and set up your accounting system.

Step 8: Obtain Important Local Permits

Several permits may be needed to comply with local and state building codes:

Occupancy Permit

To apply for your permit, visit the online Building Permits Portal or download and submit an Occupancy Permit Application (PDF). For more information visit the Planning and Codes Department page or call 931-455-2282.

Fire Inspection

Depending on the nature of the business, fire inspection might be needed for legal compliance, followed by annual fire department instructions. Examples of businesses requiring annual fire inspections include:

• Apartment buildings
• Auto painting
• Dry cleaners
• Hotels/motels
• Motels
• Restaurants
• Tire storage

The City regulates certain businesses through the issuance of special permits. Examples of businesses requiring special permits include fireworks vendors, mobile food vendors and towing companies.

Contact the Fire Marshall's Office at 931-455-0936 or 931-607-5164 to arrange for your fire inspection.

Sign Permits

Visit the Planning and Codes Permits, Forms and Applications page to download a copy of the Sign Permit Application. For more information, call 931-455-2282.

Health Permits

Health permits issued by the Health Division, are required for most retail businesses that sell food or beverages to the public. Other businesses that require health permits include swimming pool operators, solid waste facilities, grocery vendors and well water operators.

Other Helpful Information

Alcohol Sales
To sell or produce alcoholic beverages at a place of business, and Alcoholic Beverage Commission (ABC) license is needed. The type of license and fee required depends on the type of business operation.

Call the Chattanooga Office of the Alcoholic Beverage Commission at 423-634-6434 or visit the ABC website to learn more about obtaining an ABC license.

Americans with Disabilities Act (ADA) Access
General publications on ADA regulations and technical assistance materials are available to help businesses evaluate their places of business for ADA access can be found by visiting the ADA website or calling 800-514-0301.

Utilities

• Electricity, fiber and water: call 931-455-4515 or visit the Tullahoma Utilities Authority website
• Gas: call 931-455-9511 or visit the Elk River Public Utility website
• Garbage and recycling services: contact the City Recorder at 931-455-2648

Step 9: Incentives, Programs & Resources Can Help Your Bottom Line

For more information on local, regional and state incentives and programs, visit our Incentives page.

Contact Numbers

The following are telephone numbers for City Offices and entities that might be useful to vendors wishing to do business with the City:

• City Recorder's Office: 931-455-2648
• Department of Public Works: 931-454-1768
• Economic Development: 931-455-2282
• Finance Department: 931-455-2648
• Parks and Recreation: 931-455-2211
• Planning and Codes: 931-455-2282
• Police Department: 931-455-0530
• Tullahoma Area Chamber of Commerce: 931-455-5497