Entrepreneurship has a long, rich history in the United States. In many ways, the small business owner is the backbone of the American economy, creating jobs and meeting market demands. If you are interested in starting a business venture of your own, there is no time like the present. If you have years of valuable professional experience and an idea that is too good to ignore, it may be time to dive in feet first. Of course, getting a new business up and running is no minor task, and in order for your operation to be successful you need to commit yourself to long hours, including nights and weekends so that you can build something solid from the ground up. You will also be faced with a number of important decisions early on, including how your business plan will take shape, as well as the team you will hire and where you will locate your organization. At this juncture, you may also want to think about how you will legally structure your business. For many business owners, the limited liability company (LLC) formation makes the most sense. Should you find yourself in the camp, you will want to locate the correct LLC online application for your state.
Choosing a structure that is right for your business endeavor will largely depend on your goals. For instance, is your primary concern the growth of your business? Do you want to expand your team and launch additional locations? In this scenario, you may want to consider forming a corporation. In a Corporation, you can issue stock, which serves as fractional shares of ownership to be purchased by outside investors. When you sell stock in your company, you can generate the capital you need to continue growing. More commonly, however, new business owners will want to limit their tax and legal liabilities, which is why LLCs remain so popular. Read on to learn more about LLCs as well as how you can complete an LLC online application.
Why You Should Consider a Limited Liability Company
At this point in the planning process, you may be curious about just what a limited liability company is. At a core level, an LLC separates your business into its own legal entity. In many ways, an LLC has a lot of the same rights as an individual–an LLC can lend and borrow money, hire or terminate employees, and purchase the property. With an LLC, you and the other members (owners) will receive limited liability protection. This means that should your business be sued or file for bankruptcy, the members will be able to protect their personal assets from any legal action. More plainly, if your business goes bust, you do not need to worry about losing your home or retirement accounts. As this takes quite a bit of risk off the table, many business owners favor the LLC structure.
In an LLC, there is also the benefit of “pass-through” status with the Internal Revenue Service (IRS). This means that profits generated by your business will not be taxed by the IRS until they pass through to the members of the LLC, who will then pay personal income taxes. As you can imagine, this is a valuable incentive, and it comes in contrast to some corporate structures which can effectively be taxed “twice.”
How to Complete an LLC Online Application
If you have weighed the positives and negatives and determined that an LLC is a right structure for your business, you will need to complete some paperwork. LLCs are available in all 50 states, and while there are some slight variations in rules and requirements, there is generally a basic process to follow when creating one. First, you will want to choose a unique name for your business–nearly all states require that your business name not match any other LLCs or registered with the state. Next, you will want to appoint a registered agent. This individual will be charged with receiving all legal, tax, and government correspondence. Some businesses opt to fill this role with in-house legal counsel, though this is not required.
With those items in place, you can move ahead with drafting your articles of organization. This form should include some pertinent details about your business, such as its name and location. You will also need to provide the contact information for the members as well as the registered agent. Once completed, you can file this document with your Secretary of State’s office. It depends on your state, but you may have annual reporting requirements to fulfill with your LLC, though they are generally not exhaustive.
Form Your Business Online!
Whether you want to start an LLC or a corporation, we can help. At Corporation Center, we have online forms for all 50 states. To learn more, take a minute to look around our site, or visit our Frequently Asked Questions page.