Everything You Need to Know About Georgia LLCs
Starting a business can be both exciting and overwhelming3 min read
Starting a business can be both exciting and overwhelming. Between the paperwork, filing fees, and legal considerations, many laws and regulations must be carefully considered. It is especially important for business owners to understand the laws for the state in which their business will operate.
One of the most common business structures, the limited liability company (LLC), is an excellent option for business owners who want to keep their personal assets separated from their business assets. In Georgia, LLCs are somewhat different than in other states, so it’s important for Georgia entrepreneurs to familiarize themselves with the important laws and liabilities of forming an LLC in the state.
What Is an LLC?
For entrepreneurs who are not already familiar with the concept of an LLC, this type of business structure provides owners with certain advantages, such as limited personal liability for business debts, protection of personal assets, and greater flexibility in role structure and decision-making. LLCs are also attractive to potential investors because of the various tax benefits they offer.
What Are the Requirements for an LLC in Georgia?
Anyone considering forming an LLC in Georgia will need to be correctly informed about the specific laws and regulations of the state.
The Commissioner of Corporations, or the Secretary of State, regulates LLCs in Georgia. To form an LLC, the business operator must submit a Certificate of Formation to the Secretary of State office, also known as a Articles of Organization. Additionally, the Certificate of Formation must include a Registered Agent, who is an individual or entity authorized to accept tax documents, legal notices, and other documents of service for the LLC.
The business operator must submit a $100 filing fee, along with the appropriate forms correctly filled out. If the LLC has a name that includes “Incorporated,” “Inc.” “Corporation,” or “Corp.,” then they will require an additional $25 filing fee.
What Are the Liabilities for an LLC in Georgia?
LLCs offer the owner personal liability protection, meaning the operator is not held personally liable for business debts and obligations, but this should not be taken as an invitation to mismanage funds. It is important for business operators in Georgia to know that the owner may be held personally liable if the LLC does not observe the formalities for operating an LLC, meaning that the LLC must be run as per the written documents.
Additionally, owners with multiple owners must observe the LLC’s operating agreement. This means that all owners of the company are equally liable. This means that if one owner or manager fails to follow the laws, then all of the owners may be held responsible for any resulting damages.
Given these potential liabilities, it is important for Georgia business owners to seek legal counsel from business lawyers who understand and can advise them on the local laws and regulations.
Forming an LLC in Georgia can be a complex process, and many entrepreneurs are intimidated or confused by the laws and regulations governing them. Furthermore, entrepreneurs are sometimes unaware of the potential personal liabilities that come with ownership and management of an LLC.
Seeking legal counsel from experienced and knowledgeable business lawyers is the best way for business owners to protect themselves, their financial investments, and their families. Experienced business lawyers can offer valuable advice to business owners on laws and regulations and prevent them from facing personal liability.