I cannot count the number of times I heard: “just hang a shingle” when I was starting my practice.  There are other parts of your practice to set-up before getting office space.

After making some accounting mistakes, I realized the best way to get started is with these steps:

1. Get a Tax ID Number

You do not need to be corporation to get started in your practice.  Insurance companies and other entities will ask for your Tax ID number.  Luckily, getting a Tax ID is very easy.

As a sole proprietor, you are basically just “you,” but you don’t have to give out your social security number when asked for identifying information on insurance forms.  Even if you decide not to take insurance, various entities will request your Tax ID number.  Patients who wish to get reimbursed will require SuperBills that need either your SSN or Tax ID.  No one wants to give you their SSN, so get a Tax ID.  Here is a link to get more info on the Tax ID. (and, as always, check with your attorney)

The other benefit of a Tax ID (or “EIN”) is that you can use it to start a business bank account, which leads us to Step 2…

2. Open a Bank Account for your Practice

Having a separate bank account for your business will make accounting much easier.  When you are just getting started, you may think that putting money into your personal account will be easier.  DO NOT do this, it is guaranteed that this will cause confusion down the road.  Plan to run your practice like a business, and having a separate account will allow you to track the profits and losses of your practice.

All bills paid (office rent, phone lines, internet, business cards, etc.) should come out of this business bank account.  Some banks will charge a fee if you don’t keep a high minimum account balance (e.g. $5000 average daily balance, or more).  Your business account does not necessarily have to be a “Business Bank Account” with the bank.  Any separate account will do (although they may not let you use your EIN if it is a personal account).  The point is, keep your business money separate from your personal money.

3. Get a Business Phone Line

You need a phone where potential clients can call you.  When you are just getting started, you can have calls to a Business Phone Number forwarded to your cell phone.  This also helps you separate personal and business life.  You can do this for free with Google Voice or for a toll-free number where you can also receive faxes, take a look at Grasshopper.  (check with your attorney re: HIPAA compliance with these services).

You can set up these services to register your business phone number as the number that will be displayed on your caller ID.

Following these first steps will help you set up a business life that is separate from your personal life, financially, and time-wise.