Form LLC in Georgia: Everything You Need to Know
A Limited Liability Company, or LLC, is a kind of business structure that is owned either by a single person or a group of people who share limited liability.5 min read
2. Create Articles of Organization for Your LLC
3. Write Your Operating Agreement
4. Get an EIN from the IRS
5. Get Licensed
6. Get Registered
7. Additional Tasks for Business Owners
8. Taxation of an LLC
9. Why form an LLC?
How to Form an LLC in Georgia
A Limited Liability Company, or LLC, is a kind of business structure that is owned either by a single person or a group of people who shared limited liability in the business. Basically, by forming an LLC, their personal assets will not be affected in the event the LLC fails or is sued.
To form an LLC in Georgia, you have to start by creating a name. Your name must contain "LLC," "Limited Liability Company," "L.L.C.," "Limited Company," "LC," or "L.C." You may use abbreviations such as ‘Ltd,’ for limited or ‘Co.’ for company. . Make sure that your name is different from any other LLC in the state of Georgia by checking the Corporations Division business name database, which is found within the Secretary of State’s department. The name must be fewer than 80 character, including spaces and punctuation. There are also restricted words which require additional paperwork, such as Bank, and if you wish to have licensed individuals, such as doctors or engineers as part of the LLC, you may need to file more documents. Words you cannot use are those that would confuse your LLC with a federal or state agency (like Secret Service or CIA).
It is helpful to review the database to ensure your name fulfills all the requirements of the name in Georgia.
You can reserve your name online for 30 days, or by filing the Name Reservation Request form. The fee is $25. Once you come up with a name, it’s always a good idea to check and see if there are domain names available in order for you to have a strong internet presence.
Create Articles of Organization for Your LLC
To create an LLC, you must file articles of organization and pay a $100 filing fee. The articles of organization declare the basics of your company (such as the full name of your LLC), and it must also include each owner’s name and address.
If you file by mail, you must include the Transmittal Information Georgia Limited Liability Form. When you fill out the form, the names and addresses of all organizers must be included. You must also include the name and address of the person filing the form, and the full name and address of the Registered Agent of the LLC.
Speaking of registered agents, every Georgia LLC must have this in order to accept service of process in the state. The Registered Agent is responsible for accepting legal papers on behalf of the LLC in the event it is sued. . This can be an individual with a physical address in Georgia, or a business that is allowed to do business in Georgia that has a physical address in Georgia. The address cannot be a P.O. Box. The agent can be found by hiring an outside service and pay a fee, which is an option many corporations and LLC’s utilize.
After submitting your articles of organization, if all goes well, a certificate of organization is usually finalized and mailed to the applicant within five to seven business days, but it can take up to fourteen days in the event of delays.
Write Your Operating Agreement
The operating agreement is not mandatory, or even very useful for single-member LLC’s, but it is always recommended, particularly if your LLC has more than one member. This is a document used within your company to establish roles, responsibilities and duties within your LLC. It governs terms such as the roles of each member, voting and decision making rights, how members are added or removed, how profits and losses are distributed and even dissolution of the LLC. It can change over time, but it is a great idea to start with a decent framework regarding how business should be conducted. This does not need to be sent into the Secretary of State, but copies should be kept at the registered office of the LLC.
You do not have to publish any notices of your LLC in local newspapers.
Get an EIN from the IRS
If your LLC has more than one member, you will need an Employer Identification Number, even if there are no employees hired. If you have a single-member LLC, you will need an EIN if you decide to hire employees or you elect to have it taxes as a corporation instead of as a sole proprietorship. This is obtained through the IRS, and it is the number in which you are identified with the federal government. It is used to set up your tax status and on tax documents you provide to employees. There is no filing fee to obtain the EIN.
The licenses or permits you will need depend on the type of business you are opening. Check with your county clerk's office or local Chamber of Commerce to see what types of local licenses or permits you may need.
If you are selling goods and collecting sales tax, or hire employees, you must register with the Georgia Department of Revenue. This can be done online, or via mail. You will need the following information to successfully file with the Department: your social security number or the LLC’s EIN; the address of your LLC; commencement dates for accounts, and; contact information for the manager of your LLC.
You must file an annual registration every year online with the Secretary of State in Georgia. The fee is $50. The first registration is due between January 1 and April 1 of the following calendar year in which that LLC was formed.
All LLC’s who are organized outside of Georgia must also register with the Secretary of State in order to do business within Georgia. With that, the LLC’s must also appoint a registered agent in order to receive service of process within Georgia by filing an Application for Certificate of Authority for Foreign LLC.
Additional Tasks for Business Owners
If you are employing people, it is a good idea to explore what other duties you might have, such as obtaining workers compensation insurance or general liability insurance, depending on your industry.
You should also open up a separate bank account to avoid commingling with personal funds, and make it easier to file your taxes and do your accounting. Once you get an EIN, you can open up a bank account in the name of the business.
Taxation of an LLC
LLC’s in Georgia are subject to federal income tax classifications, and LLCs can be taxed in a number of different ways, depending on your own preference. An LLC can be taxed as a limited liability partnership, a C corporation, an S corporation, or a sole proprietorship. All the forms required should be researched with the IRS, as well as the various requirements and benefits of each method of taxation.
Why form an LLC?
This business structure is convenient for people who wish to start a small business. There is liability protection that is unavailable as a sole proprietorship, yet you can benefit from being taxed as a sole proprietor (or taxed only once).. The filing fees aren’t prohibitive and the process of forming an LLC is fairly straightforward. All of this makes it a very attractive choice for entrepreneurs.