LLC in South Carolina (SC): Everything You Need to Know
An LLC in South Carolina (SC) operates essentially as a corporation, sole proprietorship, and partnership all in one. 6 min read
What is an LLC in South Carolina?
An LLC in South Carolina operates essentially as a corporation, sole proprietorship, and partnership all in one. An LLC, or Limited Liability Company, affords its members with limited liability as they cannot be held personally liable for the company’s debts.
Steps to Forming Your LLC
There are five main steps to forming your LLC in South Carolina, which includes creating a business name, appointing a registered agent, filing the Articles of Organization, drafting the Operating Agreement, and obtaining an Employer Identification Number (EIN).
Step 1: Business Name
You must come up with a name for your LLC. You’ll need to conduct some research to ensure that the name is not previously taken. Other guidelines, rules, and tips include the following:
- The name must include LLC, L.L.C., or Limited Liability Company at the end of the business name.
- Certain words are forbidden, including Bank, University, College, Attorney, Doctor, Treasury, etc. This is a rather simply concept to understand. Your LLC is not a financial or educational institution. You cannot include terms like “attorney” or “doctor” unless a licensed individual having such educational credentials are part-owners in the LLC.
- The name must be available in the State of South Carolina.
- Ensure that the URL for your business name choice is available.
- Business names can be reserved for up to 120 days for a $25 charge.
Step 2: Registered Agent
This is a required step in the process. The registered agent will accept and send papers on your behalf, including annual filings as well as service of process in the event a legal battle ensues between you and another party.
Step 3: Articles of Organization
There will be a $100 fee when filing the articles or organization. It can take between 3-12 days to process your application, but can be done quicker for an additional fee. The document must include the LLC name; the number of shares that will be issued; the registered agent name/address as well as the incorporator(s) names/addresses.
Step 4: Operating Agreement
This document, while not generally required in the State of South Carolina, is highly advisable. However, the document itself may be a requirement depending on the geographic location of your LLC and the type of industry in which you choose to operate. The agreement outlines the ownership structure and daily operating procedures of your LLC. This document should be carefully drafted to include all important items regarding the operations of the LLC, accounting methods and retention of records, as well as other important decisions to be made when developing your LLC.
Step 5: Obtain an EIN
You must obtain an EIN for your LLC, which is a social security number for your business. An EIN is required to open a business bank account, for federal and state tax purposes, and must be done in order to hire employees. You can obtain an EIN from the IRS after forming your company. There is no filing fee. Obtaining an EIN can be done online or by printing and mailing the form.
Steps After Forming Your LLC in SC
- Open a business bank account to separate personal assets from the LLC assets.
- Register for Unemployment Insurance Tax and Employee Withholding Tax if you hire employees.
- If selling taxable goods or services, you’ll need to register for Sales Tax in the State.
- Come up with an organized accounting system to keep track of expenses, financing, other bills, and profits.
- Obtain any other required business permits or licenses.
How to Dissolve an LLC in SC
Dissolving your LLC in South Carolina is rather easy and straightforward. You’ll need to close your business accounts and file an Article of Dissolution.
Foreign Businesses in SC
To conduct business within the State of South Carolina, all foreign LLCs must register in the state before conducting business in the state. Before registering, you’ll want to ensure that the name of your LLC is available in South Carolina. If your LLC’s name is not available, you’ll need to create a new name that will be used only in South Carolina. Foreign LLCs must also appoint a registered agent for legal service of process. The specific requirements when choosing a registered agent include:
- the registered agent must be a resident of South Carolina
- or the registered agent must be a business that transacts business in the State.
Cable Franchises in SC
If the LLC is a cable franchise operating in the State of South Carolina, an Application for a State-Issued Certificate of Franchise Authority must be filled out and sent to the Secretary of State’s Office, along with a filing fee of $110. Other forms include the following:
- Application to Amend a State-Issued Certificate of Franchise Authority: The cable provider uses this form to amend the application that was previously submitted. Another fee of $110 applies.
- Application for a State-Issued Certificate of Franchise Authority: This is a cover letter used when the cable provider applies for the state-issued certificate.
- Notice of Change of Franchise Fee Rate: Used by the municipality when there is a change in the franchise fee.
- Notice of Change of PEG Access Channels: Also used by the municipality when there is a change to the number of PEG channels.
- Notice of Termination of State Issued Certificate or Amended State-Issued Certif. of Franchise Authority: This form is used when the cable provider seeks to terminate the state-issued certificate.
- Notice of Transfer of State-Issued Certificate of Franchise Authority: This form is used when the cable provider wants to transfer the certificate.
Nonprofits in SC
For nonprofits operating in the State, a form called Annual Financial Report for a Charitable Organization must be filled out to report financial information to the Secretary of State on a yearly basis. There is no filing fee. However, for those nonprofits exempt from registration requirements, an Application for Registration Exemption should be filed with the State. Other forms to be used by nonprofits in SC include:
- Charitable Solicitation Complaint Form: This form is to be used when submitting a complaint regarding a nonprofit organization transacting business in South Carolina.
- Payroll Deduction Form: This should be filled out by a nonprofit who is seeking payroll deduction.
- Registration Statement for a Charitable Organization: This form is to be filled out by a nonprofit to register with the Secretary of State’s Office on a yearly basis. The filing fee is $50.
Employment Agencies in SC
- Application For License To Operate An Employment Agency: This form must be filed by all employment agencies registering in the State of South Carolina for the first time. The fee for first time filing is $200.
- Employment Agency License Renewal: This is the renewal form to be filed once every two years. A filing fee of $100 applies.
Other Miscellaneous Forms
- For discount drug card sellers, a form called Designation of a Registered Agent for Discount Drug Card Sellers is to be filled out to appoint a registered agent.
- Designation of Registered Agent for Non-Resident Wholesale Prescription Drug Distributors: This form is to be filled out for non-residential discount drug sellers, and costs $10.
- Notice of Appointment of Registered Agent (Landlord Tenant Act): This form will be filled out by a non-resident landlord who designates a registered agent in the State. The filing fee is $10.
- Professional Solicitor's Bond: Used by the professional solicitor to file the bond. No filing fee.
- Joint Financial Report for Commercial Co-Venturer: Filed by all commercial co-ventures within 90 days after completion of the advertising campaign.
- Joint Financial Report for Solicitor Company: Filed by all professional solicitors within 90 days after completion of the advertising campaign.
- Notice of Solicitation – CCV: Filed by a commercial co-venture that is conducting an advertising campaign on behalf of a nonprofit organization.
- Notice of Solicitation – Counsel: Filed by a professional fundraising counsel that is conducting an advertising campaign on behalf of a nonprofit organization.
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