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How To Form An LLC In 4 Easy Steps

Ready to form an LLC in the best and cheapest way possible?

We’ve got you covered! This post contains 4 easy and stress-free steps to form an LLC.

“But…shouldn’t I hire a lawyer first?”

Nope! Forming an LLC requires zero legal expertise.

Here’s why:

Forming an LLC (i.e. Limited Liability Company) is an easy, uncomplicated way to begin your entrepreneurial journey. It’s like a corporation, but with the advantage of not being personally accountable for any business debts.

However, an LLC is more popular amongst small business owners because of:

  • Protection against personal liability
  • Taxation benefits
  • Management flexibility
  • Fewer reporting requirements

Ready to save hundreds of dollars on unnecessary legal fees?

What are you waiting for? Read on!

Note: Click here to register your LLC online with our partner, ZenBusiness. You’ll be set up in around 10 minutes.

How To Form An LLC Graphic

Step 1. Choose a state for your LLC

To get started, choose a state.

You can shortlist the state based on where your business intends to be located. If you are confident of doing business in more than one state, then you can choose your state based on:

  • Convenience
  • Lower taxes
  • Lesser paperwork

Step 2. Choose a name for your LLC

Pick a unique name for your LLC, complying with your state’s naming rules. Make sure the name ends with an LLC designator, such as Limited Liability Company or Limited Company or LLC.

Legally speaking, the name you choose should neither be “deceptively similar” to another company’s name nor “distinguishable on the record” of your state. To rule this out, you can pick a unique name on a free Business Name Generator Tool. You can also check name availability on your state’s online entity name check tool.

Here are the relevant links for all 50 states within the U.S.A:

Alabama Secretary of State: Business Entity SearchGeorgia Secretary of State: Business Search  Maryland Secretary of State: Charter Record SearchNew Jersey Department of State: Business Entity Name Search  South Carolina Secretary of State: Search Business Filings
State of Alaska: Corporations DatabaseState of Hawaii: Business Entity & Documents SearchMassachusetts Secretary of the Commonwealth: Business Entity SearchNew Mexico Secretary of State: Business Entity SearchSouth Dakota Secretary of State: Business Information Search  
Arizona Secretary of State: eCorp Business Entity SearchIdaho Secretary of State: Business Entity SearchMichigan Secretary of State: Business Entity SearchNew York Department of State: Corporation & Business Entity DatabaseTennessee Secretary of State: Business Information Search  
Arkansas Secretary of State: Business Entity SearchIllinois Secretary of State: Corporation & LLC Search  Minnesota Secretary of State: Business Entities SearchNorth Carolina Department of the Secretary of State: Corporate Name SearchTexas Secretary of State: Taxable Entity Search
California Secretary of State: Business SearchIndiana Secretary of State: Business SearchMississippi Secretary of State: Business Search  North Dakota Secretary of State: Corporate Name SearchUtah Secretary of State: Business Name Search
Colorado Secretary of State: Business Database SearchIowa Secretary of State: Business Entities SearchMissouri Secretary of State: Business Entity SearchOhio Secretary of State: Business SearchVermont Secretary of State: Business Search
Connecticut Secretary of State: Business Inquiry SearchKansas Secretary of State: Business Entity Search Station  Montana Secretary of State: Business Entities SearchOklahoma Secretary of State: Search Corporation EntitiesVirginia, Commonwealth: Business Entity Search
District of Columbia: Registered Entities SearchKentucky Secretary of State: FastTrack Business Organization SearchNebraska Secretary of State: Corporation and Business SearchOregon Secretary of State: Business Name SearchWest Virginia Secretary of State: Business Entity Search
State of Delaware: Business Entity SearchLouisiana Secretary of State: Business Filings Search  Nevada Secretary of State: Business Entity Search  Pennsylvania Department of State: Business Entity SearchWisconsin Secretary of State: Corporate Records Search
Florida Department of State: Business Name SearchMaine Secretary of State: Corporate Name SearchNew Hampshire Secretary of State: QuickStart Business SearchRhode Island Secretary of State: Corporate DatabaseWyoming Secretary of State: Business Entity Search

Step 3. Appoint a Registered Agent

Most states require LLCs to have a Registered Agent. A Registered Agent is nothing but an individual or business that sends or receives legal papers on behalf of the LLC. This could be anyone, even you. All this person needs is a physical street address in the state where the LLC is intending to form.

Step 4. File Articles of Organization

It is legally required to file Articles of Organization (also called Certificate of Formation/Organization) with the Secretary of State (or your state’s corporate filing office). All that’s required is to fill out a short form usually available on your Secretary of State’s website with basic details, like:

  • Name and address of the LLC
  • Name and address of the Registered Agent
  • Purpose of forming the LLC
  • Names of the LLC owners

This protects your LLC structure so that if you’re sued, you won’t have to abide by your state’s rules. You definitely don’t need to hire a lawyer for this step because each state’s rules are pretty much self-explanatory. Most states charge a filing fee between $50 to $500. This is the only investment you need to make towards the formation of your LLC.

While LLC formation takes 1 or 2 days, the receipt of processed documents takes anywhere from a few days to a few weeks, depending on your state. After this is filed and approved, you will receive a Certificate issued by your state and your LLC is thereby officially formed! Congratulations!

Hereafter, your LLC can start functioning after preparing an Operating Agreement, receiving an EIN and other business permits or licenses (depending on the nature of your business).

Bonus

Operating Agreement

It is strongly recommended to hold an organizational meeting with the LLCs members/managers in order to prepare this internal document. It lays down the rules, guidelines and details of your LLC, such as ownership structure, member rights & responsibilities, dissolution and so on.

If you don’t prepare an operating agreement, the Laws of your state will govern how your LLC operates. While you’re at it, you could even issue membership interest certificates and authorize the opening of a bank account for the LLC.

States requiring Operating Agreement:

  • California
  • Delaware
  • Maine
  • Missouri
  • New York

EIN

If your LLC has more than 1 member or it’s taxed as a corporation (not a sole proprietorship), make sure to apply for an Employer Identification Number (EIN).

All you have to do is fill the Internal Revenue Service (IRS) Form SS-4 and file it on the IRS website – free of charge. But you have to apply only after your LLC is approved so that the IRS can link the EIN to your LLC, and not to you personally.

Publish a notice

Depending on your state’s requirements, you might have to publish a small newspaper notice of your intent to form an LLC. This notice is usually published several times over a period of weeks, eventually informing the Secretary of State (or your state’s corporate filing office) of the same by way of an affidavit. Associated fees may be paid either to the newspaper or to the state government.

States requiring Notice:

  • Arizona
  • Nebraska
  • New York

Conclusion

And that’s it! You now know how to form an LLC for your business. Now, it’s time to implement what you’ve learned and start your LLC.

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