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What's the right age to start a small business? A survey from Junior Achievement USA reveals that 60% of teens would rather start their own business than work a traditional job. The entrepreneurial drive keeps growing. The Youth Economy Report reveals that more than a third of children work part-time, while 26% of Generation Z aspire to be their own boss someday.
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Legal hurdles stand in the way of young entrepreneurs. Each state has different rules about the minimum age to start a business. Most states don't let people under 18 sign contracts, which makes it hard to launch a business solo. States like Colorado, Illinois, Minnesota, and Oregon don't allow minors to own businesses. Yet Texas, California, Delaware, Nevada, Wyoming, and Montana let minors form an LLC.
Some of today's most successful entrepreneurs started as teens. Mark Zuckerberg created Facebook, Fred DeLuca launched Subway, and Mike Kittredge started Yankee Candle. Their stories show that great business ideas can come at any age. Young entrepreneurs need to know about taxes, too. Any minor's business earning more than $400 must pay taxes on that income.
Let's guide you through the legal maze of youth entrepreneurship. We'll show you ways around age limits and give you practical steps to launch your business before 18. This piece has everything you need to start legally, whether you're a teen with a great idea or a parent backing a young founder.
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Wondering if you're old enough to start a business? Spoiler: You probably are. Let’s clear up the legal stuff and get you started.
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Key Takeaways
- There’s no one-size-fits-all age rule: In the U.S., most states require you to be 18 to sign legal contracts, but some let minors form LLCs.
- State laws vary widely: Places like Texas and California allow minors to register businesses; others like Oregon and Illinois restrict ownership.
- Legal workarounds exist: Parents or guardians can co-own your business, or you can register in a different state and operate remotely.
- Early planning sets you apart: Teens can succeed with the right business plan, manageable startup costs, and strong adult support.
- Taxes still apply: Earn more than $400? You’re required to file and pay taxes, even if you’re not legally an adult yet.
- Telehealth is teen-friendly with support: Platforms like Bask Health give young founders tools to build HIPAA-compliant businesses without coding.
- Start small, grow smart: Age isn’t a limit—just a starting point. The earlier you start, the more experience you gain.
Understanding the legal age to start a business
Young entrepreneurs face a complex legal situation that changes from state to state in the US. Anyone looking to start a business needs to know the age-related rules that shape their path to entrepreneurship.
At what age can you start a business in the US?
The federal government doesn't set any minimum age requirement to start a business in the United States. Each state creates its own rules about when young entrepreneurs can launch their ventures.
Most business activities require you to be 18 years old, the legal age in most places. Contract law drives this age requirement because minors can't sign legally binding agreements. Any contracts they sign are "voidable," which means young people can choose whether to honor or cancel them.
This creates real problems in business relationships. Many suppliers and potential partners don't want to work with businesses that minors own because they worry about enforcing contracts. Some industries have extra rules, too. To name just one example, financial sector businesses might need owners who are at least 21.
States that allow minors to start a business
Several states give young entrepreneurs a way to start businesses. Texas, California, Delaware, Nevada, Wyoming, and Montana let minors form Limited Liability Companies (LLCs). Teen entrepreneurs in these states can register their businesses legally, but they might still run into issues with contracts and licenses.
LLC formation laws in most states don't mention age at all, which means minors can start businesses. Delaware's business-friendly laws make it easy, with minimal age restrictions for LLC formation.
Colorado stands out with its special laws for businesses that young people run. Local governments can't require licenses or permits for businesses that minors operate "on an occasional basis"—meaning no more than 84 days in a year. This protects young entrepreneurs while letting local governments control how these businesses work.
States with restrictions for under-18 entrepreneurs
Some states don't allow minors to create certain business structures. Colorado, Illinois, Minnesota, Oregon, and Texas won't let people under 18 form LLCs. Young entrepreneurs in these places need different ways to set up their businesses.
New York's laws create an interesting situation. The state requires corporation directors to be 18 or older, but it doesn't seem to limit who can organize or join an LLC.
Young entrepreneurs still have options in restrictive states. Minors can own an LLC if an adult acts as the organizer or manager. Parents can form a business for their child, with the adult serving as organizer and potentially as a member in the operating agreement.
Young people who want to start businesses across state lines should know this: if your state won't let minors form an LLC, you might be able to create one in a state with fewer restrictions and register it in your home state as a foreign entity.
Legal workarounds for minors who want to start a business
Age restrictions shouldn't stop you from pursuing your business dreams before turning 18. Young founders have legal ways to launch their ventures. Here are practical solutions to get past those age-related obstacles.
Forming a business with a parent or guardian
Most states don't allow minors to sign binding contracts until they turn 18. This creates some roadblocks when you want to start a business. Your parents or guardians can become powerful allies on your business trip.
A parent or guardian can form the LLC on your behalf. The adult acts as the organizer and handles the paperwork and legal requirements. You can join as a member after it's set up, which gives you ownership while staying within legal bounds.
This setup works great because the adult signs all contracts for the LLC. This prevents any issues with contract enforcement. To cite an instance, see Florida, where contracts with minors are voidable—meaning minors can avoid obligations without consequences. This makes other parties nervous about signing agreements.
Registering in a different state
Your home state might not let minors form LLCs. You could register your business in states that welcome young entrepreneurs. Delaware, Montana, and Nevada allow minors to establish LLCs.
A foreign qualification lets you form your LLC in a minor-friendly state while running it from home. This helps you structure your business legally despite local rules. Remember that you'll pay taxes in both states, so this works best for businesses that make good money.
Using adult co-owners or managers
Adult LLC members create a simple solution to age limits. Parents, adult siblings, or trusted friends can be these co-owners. This setup has several benefits:
- Adult members sign all contracts, which builds trust with customers and vendors
- The LLC can file a Statement of Authority that gives only adult members legal power to bind the company
- Adult co-owners can open business bank accounts and get business credit cards, solving financial hurdles that minors face
You could also set up a manager-managed structure instead of the usual member-managed setup. Adults become managers while you stay an owner. Managers run daily operations and handle legal matters, and you act mainly as an investor.
This limits your control but lets you start a business legally before you're old enough to run one yourself. As you get older, you can update the operating agreement to take on more responsibility.
These solutions help young entrepreneurs chase their business ideas legally while getting great experience. Yes, it is possible to take those first vital steps toward building your business empire with good planning and adult support.
Steps to start a business as a minor
Want to start your business as a teen entrepreneur? Let's look at the key steps to launch your venture, whatever your age.
Choose a business idea that fits your skills and time
Success starts with finding the right business concept. Your full class schedule takes up 8-10 hours each weekday as a minor. You should think about ideas that let you work flexible hours during evenings and weekends to balance your school work.
The best business ideas for minors usually share these features:
- Low startup costs (since teens have limited savings)
- Minimal transportation needs (especially if you're not old enough to drive)
- A good match with your existing skills and interests
Of course, focus on what you love doing. Ask yourself: "What hobbies could I turn into a business?" You might excel at creating artwork, enjoy lawn care, or have a talent for babysitting. Your chances of success improve when you identify your target community and understand their needs.
Create a business plan with clear goals
A well-crafted business plan matters, even at your age. Writing a business plan boosts your average annual growth by 30%. This helps you think clearly and guides your actions.
Your plan should include:
- Your business concept and target customers
- Required supplies, tools, and equipment
- Startup and ongoing costs
- Pricing strategy for products or services
- Marketing approach
- Specific goals (like customer acquisition targets or revenue milestones)
Pick a name and check availability
The perfect business name deserves careful thought. Your business name must be unique, memorable, easy to spell, and pronounce. Free business name search tools or your state's Secretary of State website can help verify its availability.
Understand startup costs and funding options
Knowing your startup costs helps estimate profits, analyze break-even points, and plan. Equipment, supplies, marketing materials, and permits make up common expenses.
Your funding might come from:
- Personal savings from allowance or part-time work
- Parents or family members as startup capital
- Grants designed for young entrepreneurs
- Microloans in some cases
Register your business legally
The minimum age to start a business varies by state, but most teens can register with adult help. The simplest approach for under-18s involves a parent forming an LLC on your behalf. The adult serves as the organizer, providing legal protection while you stay involved as a member.
Most small businesses need:
- A business structure (LLC recommended for liability protection)
- State paperwork was filed properly
- Required licenses or permits
- A business bank account (with adult help)
Managing your business as a young entrepreneur
Young entrepreneurs need to become skilled in several management skills that most adults spend years developing to run their business successfully. Let me guide you through everything in business management you'll need to direct your venture.
Bookkeeping and taxes for minors
Tax responsibilities apply to you even as a young business owner. Your business must file a tax return if it earns at least $400 in net income. The interesting part is that you can sign your tax return without any minimum age requirement.
Self-employed entrepreneurs must pay self-employment tax along with regular income tax. This tax works like the Social Security and Medicare taxes that employees have. Sole proprietors get a tax advantage when they have children under 18, since their children's wages don't need FICA and FUTA taxes.
Record-keeping plays a vital role. Your tax preparation becomes easier when you keep detailed records of all income and expenses throughout the year.
Getting licenses and permits
Your business needs various licenses and permits based on its activities and location. Small businesses of all types typically need licenses from both federal and state agencies.
A business license from your city or county government serves as the basic requirement. You might also need specialty permits if you handle food or provide specific services.
Businesses with activities in agriculture, firearms, or broadcasting must obtain federal licenses from their respective industry agencies.
Handling contracts and legal documents
An adult co-owner or guardian helps with legal documentation since minors usually can't enter binding contracts. Your online business needs essential documents like operating agreements, privacy policies, and terms of service.
Clear service agreements should spell out deliverables, payment terms, and refund policies for your customers. Your limited liability protection stays intact when you maintain proper corporate records.
Marketing and building an online presence
Today's digital marketplace demands a strong online presence. About 76% of consumers look up a company's website before visiting their physical location.
Your target audience's preferred platforms should shape your focus. Instagram works well for visual products, while LinkedIn suits B2B connections better. Content that strikes a chord with your audience helps build your field credibility.
Teen entrepreneurs benefit from their parents' guidance in the social media world. Parents should know the platforms their teens use and help keep online activities safe.
How Bask Health supports young entrepreneurs
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Bask Health creates innovative pathways for young entrepreneurs to enter the growing telehealth industry, whatever their age restrictions might be. Our platform acts as a launching pad for teens with business aspirations. We give them the infrastructure they need to handle complex healthcare regulations.
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Tools for business formation and compliance
Young entrepreneurs face unique challenges before turning 18. We designed our platform to handle critical compliance areas that usually need adult expertise. Our enterprise-grade encryption and secure patient portals take care of data security and HIPAA compliance.
Teen entrepreneurs can now participate in telehealth without putting patient privacy at risk.
The contracting framework makes shared adult-teen partnerships work with built-in legal protections for all parties. This setup lets adult partners keep legal responsibility while young founders add value to business operations.
Educational resources for teen founders
Learning telehealth regulations can overwhelm entrepreneurs of any age. Our complete training programs help everyone understand their obligations, whatever their age. These resources match market needs perfectly. Studies show 41% of teens think about starting a business as their career. Another 69% have business ideas but don't know where to start.
Support for telehealth and e-commerce startups
Our white-label telehealth engine helps entrepreneurs build branded telehealth businesses without technical expertise. Young founders get access to:
- No-code intake form builders and dynamic questionnaires that require zero programming skills
- End-to-end compliance coverage including HIPAA, SOC-2, and LegitScript certification
- Nationwide network of commercial and compounding pharmacies
- Fully integrated checkout solutions for subscription and one-time purchases
We removed the traditional barriers that would usually force young entrepreneurs to "reinvent the wheel." As our CEO notes, our platform allows "any telehealth entrepreneur to launch a fully operational brand" within days instead of months. This setup works especially well for entrepreneurs without development backgrounds. They can build patient intake forms and manage prescriptions without writing any code.
Conclusion
Starting a business before 18 comes with its own set of challenges. But these obstacles shouldn't stop your entrepreneurial dreams. Some states, like Texas and California, allow minors to form LLCs, while others, like Colorado and Illinois, have strict restrictions.
Young entrepreneurs can still chase their business dreams despite age limits. They have several options. Parents can be co-owners. Teens can register in states that welcome minors. Manager-managed structures work too. These options help teen business owners learn while staying within legal bounds.
Teen entrepreneurship needs good planning. Pick a business idea that matches your skills and fits your schedule. Create a complete business plan with your concept, costs, and goals. Then tackle the basics - name your company, get funding, and register properly with help from adults.
Taxes apply whatever your age. Any teen business earning over $400 must file returns and pay self-employment taxes. Good record-keeping helps you stay compliant and manage finances better.
Bask Health knows the unique challenges young entrepreneurs face in the telehealth industry. Our platform removes traditional barriers through no-code solutions, complete compliance coverage, and learning resources. Young founders can launch fully functional brands using our white-label telehealth engine without prior technical expertise.
Your age - 15 or 50 - doesn't matter. Business just needs dedication, creativity, and grit. Age won't limit your ability to invent or lead. Teen founders like Mark Zuckerberg and Fred DeLuca showed this by building global empires from scratch.
Teen entrepreneurs might take a different path to business ownership. But with guidance, adult support, and platforms like Bask Health, your age becomes a plus. Starting early gives you a unique experience that grows throughout life.
References
- Cimphony. (n.d.). Starting a business: Age requirements and more. Retrieved from https://www.cimphony.ai/insights/starting-a-business-age-requirements-and-more
- Foundr. (n.d.). How to write a business plan: A step-by-step guide. Retrieved from https://foundr.com/articles/building-a-business/write-business-plan
- Inc and Go. (n.d.). Can a minor start an LLC? Retrieved from https://www.incandgo.com/can-a-minor-start-an-llc/
- MyMCMedia. (n.d.). What teen entrepreneurs should know about taxes. Retrieved from https://www.mymcmedia.org/blog-what-teen-entrepreneurs-should-know-about-taxes/
- Northwest Registered Agent. (n.d.). Kid-owned LLCs: Can a minor own an LLC? Retrieved from https://www.northwestregisteredagent.com/llc/kid-owned