So you’re thinking about starting an LLC? Whether you’re a small business owner, content creator, or historian, forming an LLC can help protect your personal assets and give your business a leg up. Keep reading to learn how to start an LLC in 7 steps.
Step 1: Choose a Name for Your LLC
The first step in starting your LLC is choosing a name. Your LLC name must be distinguishable from other businesses registered with your state. You can check to see if your desired name is available by searching your state’s business registry. Once you’ve chosen a name, you can reserve it with your state for a small fee. This is optional but may be worth it if you want to secure your desired name before moving forward with the rest of the process.
Step 2: Reserve a Name (optional)
If you decide to reserve your LLC name, you’ll need to file a form with your state’s business registry and pay the associated fee. The amount of time your reservation is valid for will vary from state to state, so be sure to check with your state’s requirements.
Step 3: Choose a Registered Agent
Your registered agent is the person or business responsible for receiving legal documents on behalf of your LLC. This could include items like service of process notices, tax forms, or official correspondence from the state. Your registered agent must have a physical address in the state where your LLC is formed and be available during normal business hours. Many people choose to name themselves as their own registered agent, but you can also hire another person or business to serve in this role.
Step 4: Prepare an LLC Operating Agreement
An LLC operating agreement is not required in every state, but it’s a good idea to create one regardless. This document outlines the ownership and management structure of your LLC as well as the rights and responsibilities of each member. Having an operating agreement can help prevent disputes down the road and make sure everyone is on the same page from the start.
Step 5: File Organizational Paperwork With the State
Once you’ve taken care of steps 1-4, you’re ready to file your Articles of Organization (or Certificate of Formation) with your state’s business registry. This is a fairly straightforward process that can usually be done online. Be sure to check with your state’s requirements as there may be additional forms that need to be filed along with your Articles of Organization.
Step 6: Obtain a Certificate From the State
After you’ve filed your paperwork and paid the associated filing fees, the state will issue a certificate of formation (or articles of organization) for your LLC. This document serves as official proof that your LLC exists and can be used for things like open bank accounts or applying for licenses/permits.
Step 7: Register To Do Business In Other States (optional)
If you plan on doing business in multiple states, you’ll need to register your LLC in each one separately. Each state has its own requirements for out-of-state businesses, so be sure to check with the Secretary of State’s office in each state where you plan on doing business. Depending on the type of business you’re in, there may also be other federal or industry-specific licenses and permits required before you can start doing business.
Starting an LLC doesn’t have to be complicated or expensive—in most states, it can all be done online in just a few steps. By taking care of some key details upfront, you can save yourself time and money down the road.