North Carolina LLC: Everything You Need to Know
A North Carolina LLC is a business within the state of North Carolina which has designated itself as a limited liability corporation for the purposes of taxation.3 min read
North Carolina LLC
A North Carolina LLC is a business within the state of North Carolina which has designated itself as a limited liability corporation for the purposes of taxation.
In population, North Carolina is number 10 in the United States and number 9 regarding gross domestic product. The state is also home to several of the U.S.’s largest companies. These large companies include Bank of America, LabCorp, Lowe’s, Reynolds American, and Martin Marietta Materials.
States compete to attract business to their cities and rural areas. North Carolina has been successful in wooing industry members in information technology, communications technology, financial services, energy, biotechnology, automotive, and aerospace. In addition, North Carolina has attracted hundreds of thousands of small businesses. In fact, small businesses represent 98 percent of the employers in the state.
How to Form an LLC in North Carolina
If you are starting your own business, you need to decide whether a sole proprietorship or an LLC is better. If you have already decided on LLC for your company, then here are the steps to follow to complete the process in North Carolina.
1. Name Your Business
There is much to consider when naming your company. This name should convey what your business does and can be found with keyword searches on the internet. Limited liability company must also appear in the name or a derivative (i.e. LLC or L.L.C.).
Research to make sure that no other organization in North Carolina is currently using the name or one substantially similar. The name may not be misleading. If the name states or implies that the LLC is organized for business purposes other than what is stated in its articles of organization, the Secretary of State for North Carolina may not approve it.
Some words are restricted because they imply that the company is a government entity. Search for the name on the state’s website. Filing an application with the Secretary of State can reserve the name you’ve selected for 120 days.
2. Choose a Registered Agent
A registered agent is required for North Carolina LLCs.
This is a person or business (sometimes a law firm) that receives legal papers and correspondence on behalf of the LLC. If an LLC is sued proper service must be delivered to this agent. North Carolina requires that this agent be a resident of the state or a corporation that is authorized to do business there.
3. File the Articles of Organization
You must file Articles of Organization to register an LLC. This can be done through the US mail.
Articles of Organization must include:
- LLC name
- LLC address
- LLC’s registered agent
- LLC’s dissolution date (if applicable)
- Form of management (members or managers run the LLC)
- Name and address of each person signing the articles
Additional information may also be included but isn’t necessary. You must pay the current filing fee required by North Carolina’s Secretary of State. Your Articles of Organization will be processed in about 5-7 business days.
4. Acquire an Employer Identification Number
An Employer Identification Number (EIN) is the number used to identify your business to the government. This number is used to file federal and state taxes and many banks use them for business checking accounts. There is no cost or fee associated with obtaining an EIN.
Either apply online or print out the form and mail it in to the IRS.
5. Create an Operating Agreement
The legal document used to outline the ownership and procedures for operation of your company is called the operating agreement.
This is not required but highly recommended.
North Carolina courts have recognized LLC operating agreements as governing documentation.
6. Comply with Federal Taxation and Regulation
As a state in the United States, LLCs in North Carolina must file federal income taxes and adhere to all other laws in the nation.
7. File Annual Reports
Annual reports must be filed with North Carolina’s Secretary of State for LLCs in the state. If the LLC is formed after April 15th, they will not have to file an annual report until the next calendar year. Each annual report must also be filed with the current filing fee.
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