Incorporate in Florida: Everything You Need to Know
When you incorporate in Florida, you are forming a corporation within the state of Florida that allows you to raise capital by selling shares of your company.3 min read
2. How Much Does It Cost to Incorporate in Florida?
3. How to Form an LLC in Florida
4. Taxes and Fees for Filing for LLC
5. Necessary Documents
6. Advantages of Incorporating in Florida
7. Making the Decision to Incorporate
Incorporate in Florida
When you incorporate in Florida, you are forming a corporation within the state of Florida that protects you from liability, provides tax deductions, and allows you to raise capital by selling shares of your company. To make the incorporation process as easy as possible, entrepreneurs and anyone operating as a sole proprietor can find online resources to incorporate.
How Much Does It Cost to Incorporate in Florida?
The base fee for incorporating in Florida is $70. This includes the registered agent designation and filing fees. The actual total cost depends on factors like the location and type of business. The Florida Department of State Division of Corporations accepts payment of additional fees. Fees include:
- Certificate Copy: $8.75
- Certificate of Status: $8.75
- Foreign name renewal: $87.50
- Non-profit reinstatement: $175.00
- For-profit reinstatement: $600.00
- Active business's resignation of registered agent: $87.50
- Inactive business's resignation of registered agent: $35
How to Form an LLC in Florida
Anyone who wishes to form an LLC in Florida is required to obtain the necessary permits and licenses to operate in that industry, as well as file necessary paper work. While an operating agreement isn't mandatory, it's recommended that you have one. An operating agreement specifies the role of each member of a business (for companies that have two or more members). It's possible to file documents online for anyone who wishes to create an LLC in Florida.
Taxes and Fees for Filing for LLC
State fees include:
- Filing for LLC: $100
- Registered agents: $25
- Obtain a certified copy of record: $30
- Change the registered agent: $25
- Reinstatement: $100
- Obtain a certificate of merger: $24
- Correction articles: $25
- Annual report: $138.75
- Late fee for annual report: $400.00
It's important to check with regulatory organizations often because a renewal of a Florida LLC could vary depending on the industry.
To complete an application for a business license, applicants must provide several documents. The type of license a person is filing for will determine which documents are required. To get all the necessary information, a person can find and download the application online.
Applicants will need a tax identification number provided by the IRS. All requested documents are required in order to legally operate a business in the state.
Advantages of Incorporating in Florida
One of the biggest benefits for incorporating in the state is the absence of a personal income tax. Outside of Florida, some states charge corporations a 5.5 percent tax on taxable income more than $5,000.
If you fall under "S" status in Florida, you'll be exempt from the 5.5 percent corporation tax. "S" businesses in Florida are considered non-taxable, so after the first year, they don't have to file state income tax returns. These companies save money this way. There is also no minimum capital requirement to incorporate in Florida, unlike other states, which require at least $1,000 to begin a business.
Florida makes it easy to incorporate because a person can hold several titles within the business. This includes director and officer positions such as:
Because Florida has some of the fewest requirements related to corporate reporting and some of the lowest annual fees, the state is considered "business-friendly."
Making the Decision to Incorporate
Depending on the legal structure, each business type has pros and cons relating to how you can protect yourself from liability and how much money you save in taxes as well as how you share profits and loss. When ownership is shared between two or more people, that's considered a partnership. When parties agree to form a partnership, each party is responsible for:
- His or her share of the profits
- Individual share of losses
- Individual liabilities
If one party fails to pay his or her share of debts, anyone in the partnership is considered liable for the full debts included in that partnership. Partnerships seem to work best when each partner complements the skills of the other partners. Owners of LLCs are responsible for paying self-employment tax as well as taxes on the share of the profits that's theirs; this share should be clearly spelled out in a business agreement. Each party files an individual tax return. LLCs are exempt from personal liability due to any choices or actions that the business makes.
If you need help with incorporating in Florida, 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.