Get LLC Online: Everything You Need to Know
Requirements vary from one state to the next, but LLCs are the simplest business structure to form. Many people choose to file online for the convenience.3 min read
2. Articles of Organization and Fees
3. Operating Agreement, Permits, and Licenses
If you want to get LLC online by filing at your Secretary of State website, follow these steps:
- Choose an appropriate business name that adheres to your state's guidelines.
- File formation paperwork and pay filing fees.
- Create an operating agreement for your business.
- Obtain any required permits and licenses.
A few states require the additional step of publishing a notice of intent.
Many people choose to file online for the speed and convenience. Exact requirements are slightly different from one state to the next, but LLCs are the simplest business structure to form. In many cases, you can be done with the paperwork in an hour or less.
Naming Your LLC
Your LLC name must comply with the rules in your state. Each state has its own specific requirements, but the following are common guidelines for LLC names:
- The name has to be unique and distinguishable from existing business names.
- It has to include a designator on the end that identifies it as an LLC, such as “Limited Liability Company,” “L.L.C.,” or “Ltd. Liability Co.”
- The name can't have prohibited words in it, such as “Corporation” or “Bank,” for instance.
You must also make sure your LLC name doesn't infringe on anyone's trademark. You can check your state's online database for the availability of your desired business name. Many states allow you to reserve a name for a set period of time, for a fee.
Articles of Organization and Fees
After you choose a suitable business name, you'll file formation documents with the state. Common terms for these documents include the following:
- Articles of Organization
- Certificate of Organization
- Certificate of Formation
This paperwork can be very simple, and your state may have a template that allows you to fill in the blanks. You'll provide basic information in your Articles, such as the business name and address, along with the owners' names. Some states require all owners, or members, to sign the documents, while other states allow a designated owner to sign for all parties.
In your formation documents, you'll name your company's registered agent, also known as an agent for service of process, statutory agent, or resident agent. This is a person or company that accepts legal paperwork on behalf of your business.
You'll pay filing fees when you submit your Articles. In most states, these fees are modest, averaging around $100.
Operating Agreement, Permits, and Licenses
Many states don't require you to file an operating agreement or even have one. However, it's a good idea to create one for your own use. An operating agreement is similar to corporate bylaws or a partnership agreement. It details how your company will be run and managed.
It provides a framework to handle conflicts that may arise between members as well as ownership transfers. You can make your agreement as basic or detailed as you prefer, but it's highly recommended to have one in case disagreements arise between owners regarding the management or ownership of your company.
Typical operating agreements cover the following:
- The amount of ownership percentage each member holds in the business
- Rights and responsibilities of all members
- The voting power each member holds
- The allocation of profits and losses
- Management of the business
- Voting and meeting rules
- “Buy-sell” provisions to outline the procedure if a member becomes disabled, passes away, or wishes to sell his or her ownership interests
Once you've completed all of these steps, your LLC is officially created. Before you open your doors for business, however, make sure you have any necessary permits and licenses to legally operate in your city and state. You may need an Employer Identification Number — also known as an EIN or Federal Tax ID Number — from the IRS, a business license, a zoning permit, and/or a seller's permit.
Because you can complete so many of the steps to create an LLC online, it's generally an easy, straightforward process. Many small business owners prefer the simple structure of an LLC since it provides the limited liability protection they want without the complexities of a corporation. You should still weigh the pros and cons of an LLC to ensure you choose the most appropriate business structure for your company.
If you need help starting an LLC, you can post your legal need on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.