How to LLC Yourself: Everything You Need to Know
To form an LLC by yourself, you need to follow certain steps. The time and money you need to file an LLC yourself depends on the state where you are filing.3 min read
How to LLC yourself? To form an LLC by yourself, you need to reserve a business name, appoint a registered agent, file the Articles of Organization, obtain an Employer Identification Number, and open a business bank account. The time and money you need to file an LLC yourself depends on the state where you are filing.
The LLC Business Type
The LLC entity type is a popular business type because it allows small business owners to get limited liability protection without having the formal structural and recordkeeping requirements of corporations. Many business owners desire to register their businesses as LLCs but they don't because of the time-consuming procedures involved. This guide will help you understand how you can form an LLC by yourself.
It is a good idea to reserve a name before you officially attempt to register the LLC. This will minimize the chances of your LLC registration being rejected because of using a name that is already taken. LLC name reservation is normally done with the department of the Secretary of State, Division of Corporations. The good news is that many states have online databases where you can research the availability of any name you have in mind. In some states, you can even reserve a name online by paying a small fee. It is important to note the following requirement for naming an LLC:
- The LLC name must be different from the names of other businesses that are already registered in the state. The level of variance required between your LLC's name and the others is determined by your state.
- The LLC name must contain a company descriptor. Words like “company”, “LLC”, or “Limited Liability Company” are normally required in the name.
- LLC names can be reserved for a couple of weeks in most states. This is normally more than enough time for you to complete registering your company officially.
Appointing a Registered Agent
The name and address of the LLC's registered agent is normally required on the official registration papers for your LLC. The agent is a person or entity tasked with receiving legal papers on behalf of your LLC in the event that your company is sued. The agent must have a physical address in the state and must be available during work hours on all workdays for this purpose.
Filing the Articles of Organization
This document is normally submitted to the state's Secretary of State along with a filing fee. The acceptance of the Articles of Organization by the Secretary of State means your LLC has officially been formed. The Articles of Organization documents some details about your company. Typical details required on the Articles of Organization include:
- The name and address of the company.
- The names and addresses of the LLC's members and managers.
- A statement on whether the company will be managed by a manager or the members.
- The name and address of the registered agent of the LLC.
Although successfully filing the Articles of Organization indicates that the state recognizes the LLC, you still have some work to do to make the LLC operational. Other steps that you might need to do to make your LLC operational include:
- Publishing the Articles of Organization
A few states require newly formed LLCs to publish their articles of Organization in a local newspaper and to file an affidavit of publication with the state.
- Drafting an operating agreement
The operating agreement is not filed with the state but is needed by the LLC to specify the roles and rights of the members. Although you can draft the agreement yourself, it is recommended that you involve a knowledgeable lawyer from your state.
- Getting an Employer Identification Number (EIN)
The employer identification number may be needed to file taxes for employees and members of the LLC. This number is an identifier of the LLC with the IRS and can be obtained by applying online.
- Getting a business bank account
Your LLC will need a business bank account or the members' limited liability protection can be called into question by the authorities.
- Getting Business Licenses and Permits
Like other businesses, your LLC will likely need permits and licensesto operate. You might need to get permits from the county or city government, state government, and even the federal government. You can find details about the particular licenses and permits you will need from the local chamber of commerce and the SBA guide.
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