Much like anything having to do with starting a business, the question of how do I make my company LLC is a process that you must work through step-by-step to reach success. An LLC is an attractive option for small businesses because of the liability protection and the array of tax savings that are available. However, it might not be the right choice for everyone. Understanding more about an LLC and how it works can help you decide whether you should move forward or not. Here’s what you need to know.
Step 1: Choose the State to Form Your LLC
You can form your LLC in any state that you like, though many business owners choose to do so in the state where they live or plan to operate the business. Delaware is a hugely popular choice because the state offers certain tax benefits. Additionally, the state has a corporate law system that uses judges rather than juries, which helps speed up the processes they take on. You can form your LLC in Delaware without being a resident, but keep in mind that you will have to register as a foreign LLC, which can increase your costs.
Step 2: Name Your LLC
Start by doing a business name search in the state where you plan to form your LLC to be sure it’s original and not being used by another entity. You may also want to search for a trademark on the name you’re considering so you don’t face legal trouble for infringement.
Step 3: Hire a Registered Agent
A registered agent is required if you are forming your LLC in a state where you don’t reside. This person can receive legal and tax documents in the state where your company is registered. Your registered agent must have a physical address in the state where the LLC is registered.
Step 4: Create an Operating Agreement
This is required in any state and it can be written or oral. Most experts recommend having a written operating agreement because it forms an official record of how the company is divided, who takes on which responsibilities, and how to handle disputes. Have a lawyer look this over for further protection.
Step 5: File with Your State
Now you’re ready to file your LLC documentation with the state where you plan to register. This is usually referred to as Articles of Incorporation. You can often do this online to speed up the process.
Step 6: Get an EIN and Open a Bank Account
Once your filing has been approved, you can obtain your EIN and open a business bank account so that you can begin the operation of your business. If you plan to operate in additional states, now is the time to register there as well.
An LLC is a great choice for many business owners and learning the answers to the question, how do I make my company LLC can help you along the way. Corporation Center is here to help you register in Delaware. Contact us today and we’ll have your LLC up and running in no time at all.