Becoming an LLC

Choosing a name for your LLC is the first step to becoming an LLC. Choose a name that’s not only available but that operates under your state-specific LLC regulations. Filing the official paperwork is a good place to begin and those are typically described as Article of Organization. Once you pay the fee to file (somewhere between one hundred and eight hundred dollars, varying by state), you can obtain an LLC’s operating agreement. This outlines the sets the responsibilities and rights of an LLC’s members. Then you’ll create a notice and publish your intent to create an LLC (also only required in some states) and then you’ll earn a license and a permit that may be necessary for your LLC to operate.

Your LLC’s name must be in agreement with the state’s regulations, usually under the Secretaries of State jurisdiction. Requirements on choosing an LLC name may change depending on your home state. The name can’t be identical to another LLC’s name that’s on file. Likewise, the LLC name has to finish with the LLC designation attached (something like, "Limited Liability Company" or an abbreviated version of this phrase, like LLC. On creating a name for your LLC, it can’t utilize certain forbidden words per the state, which may include: bank, corporation, insurance, or city.

The LLC governance in your state can outline the availability of your proposed LLC name. For a nominal expense, you’re able to reserve that preferred LLC name until the articles are filed. Another important thing to remember is that you have to be certain your name doesn’t infringe on some other company. When you’ve determined a legally sound and usable LLC name, you won’t need to register that LLC with at state level. Once you’ve filed your articles of organization, that LLC name is registered automatically.

Generally speaking, if you’re running a small business and you sell any services or products in a single state, you should probably register that LLC in your home state. However, you might have to complete LCC registration in the total number of states where you’re operating. Though only certain state necessitates outer state LLCs (which are known as foreign LLCs) in order to register, then you’ll give fees to the state where you are a guest. 

Filing Articles of Organization

Once you’ve settled on your LLC’s name, gather and file the aforementioned articles of organization at the state level LLC office. Most states employ the phrase Articles of Organization in reference to baseline documentation needed to register an LLC, though other states may refer to these as a Certificate of Organization or even a Certificate of Formation.

Fees for Filing

A downside to creating an LLC in lieu of filing for a partnership (or even sole proprietor status) is that you are responsible for paying a fee when submitting Articles of Organization. Likely, these are small fees around one hundred dollars, though a state like California sometimes charges a yearly tax that can amount to $800, in addition to the fee to file.

Information That’s Required

The Articles of Organization documents are brief and straightforward paperwork. Typically, you can assembled these solo in a spare moments and you only fill in blank spaces and check given boxes on the state form. 

As a Registered Agent

You need to offer only your LLC's name, address, and the names of the members, generally, all of the LLC members can sign and prepare the articles, or they may assign another person to do so. You’ll likely be made to enumerate names and addresses of people, likely a member of the LLC, that can be your "registered agent," or what’s called an "agent for service of process."

Your agent is the individual assigned to obtain legal papers in any future lawsuit that involve your LLC. Registered agents are individuals or even an entity that has been authorized and made responsible to be the recipient of any legalities on paper, pursuant to the LLC. LLCs aren’t people, so to serve paper you need to designate a representative.

Your registered agent should be outlined in your articles of organization, though the designation can be altered if you file the appropriate documents with the state. Some states use different terminology than “registered agent,” such as local agent, corporate officer, agent for service of process, resident agent, or otherwise. The name of this agent is in the public domain, so if you want this person to remain anonymous, you should likely hire someone who is a professional in this regard. LLC businesses don’t always conduct business in-state, so you may have to hire a registered agent specific to a certain state. Don’t forget to imagine the associated expense, which can go up to $150 in a single year.

LLC Operating Agreement

While operating agreements don’t need to be filed at the office responsible for LLC in your state, you should probably make one anyway. In an LLC operating agreement, you outline guidelines that govern ownership and decide the operations of your LLC (similar to partnership agreements and a corporation’s  bylaws). A usual LLC operating agreement consists of:

  • The listed percentage interests of all members, along with his or her rights in the business and their responsibility
  • Any voting powers bestowed
  • How to allocate any profits or losses
  • How your business will be managed
  • Guidelines for hosting a meeting and tallying a vote
  • Any provision related to buying and selling
  • What happens if a member wants to see her or his interest in the business or otherwise becomes unable to hold their share

Publishing a Notice (Only in Certain States)

In some states, you have to complete an added step in order to register your company officially. You have to publish a straightforward notice in an area publication, and this notice must state your intent to create a business in the form of an LLC.  You’re also made to publish this a few times over few weeks. Then, you will submit an "affidavit of publication" to the area office that handles the filing of LLCs. Your local paper can assist you in this. Once you've finished these steps, your LLC is made official. Before you begin business, you’ll need to earn the licenses and whatever permits are necessary for new businesses.

Get Licenses and Permits

Include a business license (also called a "tax registration certificate"), a federal EIN, a seller's permit, or a zoning permit.

Getting A Free Attorney Match for Your LLC

Forming a limited liability company (LLC) can be a long-term benefit to your new business, but the process can be complicated. To ensure that your new business complies with your state's legal requirements at all steps in the LLC formation process, you may wish to consult an experienced small business attorney. Retaining a lawyer or his or her firm to become your serviceable agent does have some upsides. The main job of an agent is to be around get served, and a law firm is a good candidate for this since they’re unlikely to move addresses and will be good stewards of your legal papers. Any related tax mail or other official notices or documentation are delivered to this agent, making a firm or lawyer an excellent candidate. 

A Note on LLC Names

Your LLC's name should reflect LLC status, most states require an LLC identifier. You should always hold yourself out to the public as an LLC to ensure maximum liability protection, therefore, your LLC's name must include either Limited Liability Company, Limited Liability Co. or LLC. (Some states allow Limited or Ltd., but this designation may imply a limited partnership.)

Can I Organize My LLC Myself or Hire a Lawyer?

In these early stages, determine if you should file/organize an LLC solo or bring in a professional or a discount budget LLC service.


The ideal advantage in outlining your LLC by yourself is the monetary savings. Doing it yourself has the lowest overhead costs—though this could cost you down the line if done incorrectly. If you don’t handle your LLC’s organization right, then you risk your own assets by not creating the adequate distinction between you and your business.

A pricier alternative means hiring some kind of discount LLC organizing service though the price tag can go up to three hundred per LLC organized. Certain discount LLC organizing companies have efficient service and can even record minutes of meetings among members of an LLC. 

Discount LLC Organization Services

Organization services from discount LLC companies certainly have value and assist you in understanding the myriad regulations state to state. They often give service that is prompt and accurate. They often use fill in the blank options for conducting meeting minutes and sometimes these are difficult to file and understand completely. LLC’s may issue share as part of the initial beginning process, which can be handled by some of these organizations. The aggregate means the percentage interest of shares in a member’s unit. Derive any structure for ownership in the beginning staging, before you create and file any article relates to organization

Determine the LLC Ownership

Every state says it’s okay to have single-member LLCs, there aren’t any forbiddances on the max number of owners, though you could attempt to maintain a small amount.

How Many members are there in an LLC?

Every state allows a single member LLC to operate and there aren’t any legal regulations to max out the number of owners for an LLC, but consider keeping that total smaller. For every member added, you should draft what’s called a letter of investment representation. The letter gives guards to the entity there are certain representations about qualifications, including whether he or she is fit to serve. In the investment representation letter of the LLC, the member makes certain representations regarding his or her investment objectives, which are necessary representations in order to comply with state and federal securities laws. The LLC’s owners give capital contributions to earn interest in the scope of the LLC. Capital contributions equal the complete amount of liquid funds, property, any service or promissory notes, or other kinds of obligations to give a company an owner’s interest. As a rule, a capital contributions made to an LLC determine the ownership percentages in that LLC. Members' capital contribution is decided in the early stages. Every member who has given a capital contribution has committed in written form found in the operating agreement.

File the Articles of Organization

LLCs begin by preparing and filing of articles of organization. These are usually a single page document, which outline basic info, such as an LLC’s name, its address, whose authorized to hold the legal papers on behalf of an LLC. Also included is the statement of purpose, and potentially any names of members or managers. There are additional matters that may be included, like if the LLC has endless life or will has a dissolution date predetermined. Generally, LLCs appoint members in the articles of organization. States range in regards to the requirement of appointed members. This is optional in California, but in Nevada it's by law. Member are, without trouble, appointed not long after filing. Articles of organization remain in the public documents and can reveal LLC member names in the public.

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