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See below for some tips on the major steps involved in forming an LLC (Limited Liability Company). We cannot provide you with legal advice, but we can provide the tips below.
You can set up an LLC yourself, or you may want to consider hiring an attorney. Be sure to follow all state and federal requirements and regulations when setting up your LLC.
The tips below are not to be construed as legal, business, financial or tax advice in any way.
**1. Choose an available business name that complies with the LLC rules in the State of Formation. **
In most, if not all states, there are specific requirements with regard to naming.
- The name must end with LLC, or some variation of LLC, like “Limited Liability Company,” “Limited Company,” etc.
- The name cannot include words prohibited by the state. Prohibited words differ per state.
- The business name cannot be the same name as another LLC on file with the state. You can check the availability of a business name on most states’ Secretary of State websites.
- The name cannot violate another company’s trademark.
2. File Articles of Organization in the State of Formation.
_Note: Most states use the term “articles of organization” but other states may use the term “certificate of formation” or “certificate of organization.” _
Articles of Organization are short, simple documents. Although state requirements differ, most states will only require that general information is contained within the document such as the LLC’s name, its address, and sometimes the names of the LLC members.
Your state may require you to select a “registered agent” or an “agent for service of process” for the LLC, who is the person or entity responsible for receiving documents related to the LLC. Some states require that the name and address of the registered agent be listed on the LLC articles of organization.
Every state has its own rules for what information should be included in the articles of organization and for filing articles of organization.
3. Publish a notice of intent to establish an LLC (if applicable).
A few states require that you publish a public notice (for example, in a local newspaper) stating that you intend to establish an LLC.
4. Create an LLC Operating Agreement (if applicable).
An LLC operating agreement is required by some states. An operating agreement sets out rules for ownership and operation of the business and typically includes information like the members’ voting power, how the LLC will be managed, etc.
5. Obtain all Internal Approvals Needed from your Governance Team to Form the LLC
Consider whether your Board of Directors, Shareholders or other governance body need to approve the formation of the LLC in the form of a Board or Shareholder approval or consent.
5. Obtain registrations, licenses and permits required for the LLC.
Some, if not all, states require that you register or qualify your LLC after it has been formed. The procedures for qualification differ by state.
You may also need to obtain additional licenses and permits such as an EIN, a business license, a zoning permit, etc.
Response times vary by state, but you may receive your LLC certification of organization within 10 to 20 business days.