Are you interested in making your dreams into reality? Then the first step is to trade your 9-to-5 mentality for an entrepreneurial one.
Of course, that’s easier said than done. It can be daunting to set out on your own. There’s no one to rely on but yourself to get things done, and if you don’t have the most organized mind, it can be challenging.
Thankfully, there are guides online that can guide you through the process of filing for an LLC.
In this article, we’ll discuss how to set up an LLC so you have an easier and smoother time opening your business.
Choose Where to Form Your LLC
Many people don’t know this, but you’re not required to form your LLC in the state where you live and/or plan to do business. So this means that if you live in California, you can form your LLC in Utah, New York, Florida, etc.
However, it’s usually the best choice to set up your LLC in your state of residence. This is because if you choose any other state, your LLC will be a foreign one. This may have negative consequences, such as more costs and fees.
Do note that these costs and fees can be mitigated if you choose the location smartly. Some states have significantly more advantageous taxation and LLC laws, so it can be worth your time to do some research before making a decision.
To make things easier, know that you can get a virtual mailbox in the state you select. That way, you won’t need to get a physical address where you receive your business mail.
Pick Your LLC’s Name
Your company will need a name. Not only should it be memorable, but it should also be unique. This will allow you to have a distinct business that won’t be confused with another.
Depending on which state you register your LLC in, there will be specific rules to follow. However, in most cases, you’ll be required to add some form of “LLC” in the name, such as Limited Liability Company, L.L.C., or LC.
To check that the name is available, you can search your Secretary of State’s records. In addition, you can do a trademark search to double-check that you aren’t infringing on anyone else’s intellectual property.
Once you’ve found an untaken name you’re happy with, it’s recommended that you reserve the name with the Secretary of State. You can pay a small fee to ensure that no one else takes it while you get set up.
Name Your Registered Agent
A registered agent is also known as a resident or statutory agent in some places. This is the person or organization that can receive legal and official documents on behalf of a company.
Typically, the registered agent needs to have a physical address in the LLC’s state. This means that theoretically, you, your partners, or your employees can fulfill this role.
However, we don’t recommend this, as the agent has to make their full name and address publicly available, meaning your privacy would be compromised. Plus, you need to be available during all business hours to receive these documents.
It’s better if you utilize a registered agent service like Business Anywhere’s. We centralize all your documents in one easy-to-use hub that you can access wherever you have an internet connection.
Decide Your LLC’s Members
Naturally, you’ll be the LLC’s owner, and you can be the sole member. Or you can have other owners alongside you, or they can be members. In fact, they don’t always have to be individuals; they can also be corporations or other LLCs.
Whatever you decide, you’ll need to make clear who the members and owners are for your legal documents.
File Your Articles of Organization
On that note, you’ll have to file your Articles of Organization with the Secretary of State. This is also known as the Certificate of Organization or Certificate of Formation. In this document, include your LLC’s:
- Registered agent’s name and address
Filing fees will differ from state to state, so research this beforehand to avoid surprises.
If you’re wondering how you can register an LLC, then this is it. Once the Secretary of State approves your Articles of Organization, you’ll get a certificate in the mail that means your company is now legitimately open for business.
Prepare Your LLC Operating Agreement
Not all states require that you write up an LLC operating agreement, but it offers you protection, so it’s wise to have one.
In this document, you’ll outline the ownership structure and member responsibilities. It’ll also detail voting rights, profit distribution, and other internal operations.
Basically, the operating agreement sets clear guidelines for running your business. This can come in handy in legal disputes, as the court will refer to this document to make a decision. Without one, the final outcome probably won’t be in your favor.
Get the Proper Licenses and Permits
The proper licenses and permits you’ll need will depend on where your LLC’s located and what industry it’s in. It’ll depend on whether you have a physical location too.
You can always research the local, state, and federal requirements to ensure compliance. But to make things easier and to have more peace of mind, you can also consult with a lawyer.
Now You Know How to Set Up an LLC
Knowing how to set up an LLC before you get started can take a lot of stress and anxiety off your shoulders. And by knowing the order of steps you should take, this ensures that you won’t miss anything critical.
However, you can further decrease your burden by having a professional do business registration for you. For example, all you have to do is submit some key pieces of information to us at Business Anywhere, and we’ll do all the hard work for you.
If you need assistance with creating an LLC, then sign up with us now. We have comprehensive services that’ll bring your company to life in no time.