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How To Form an LLC

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Starting a business and need to learn how to start a limited liability corporation?

For those who wish to change their business entity from a sole proprietorship to an LLC the task may seem daunting at first.

After all, you cannot just “announce” that your business is an LLC. Instead, you have to legally form an LLC.

Upon hearing this, some may become nervous. They may initially assume that forming an LLC involves a long, complicated process of incorporating. In reality, the process is not so much complicated as it only involved taking a few deliberate steps. So, let’s take a look at the basic steps required to form an LLC…

Getting Started – How To Start A Limited Liability Corporation

Naming the LLC is the very first step that needs to be taken when finding out how to start a limited liability corporation. Now, you can pretty much name your LLC anything you like provided the name already isn’t taken or trademarked. So, you will need to do a little research on the availability of the name.

If the name is available, it is “good to go.” On a side note, it wouldn’t hurt to trademark the name as well so no other entity can appropriate it.

The next step involves filing the necessary paperwork. Filing an “Intent to Form an LLC” statement may be required depending upon the state in which you live. As such, you need to research this requirement depending upon the locality you live and if it is required you will need to file the documents prior to proceeding.

LLC Documents

The official LLC paperwork will need to then be filed with the Secretary of State’s office. (Please note: This refers to your local Secretary of State office and NOT the federal State Department!) Within this paperwork will be included the articles of organization which will detail much of your business’ information.

The common information in the articles of organization will detail the managers and members of the LLC; the name of the LLC and its physical address; and the name and address of the official registered agent of the LLC designated to receive official correspondence.

It is also important to include an LLC operating agreement as this will specific define the roles and duties of the members of the LLC. Basically, the articles of organization tell the state what the business is and who is running it.

As much as we are loath to accept it, you will need to pay the proper filing fees with the state. These fees are usually nominal and probably only run in the range of a few hundred dollars. Consider these tax deductible expenses as an insurance policy in how to start a limited liability corporation.

After all, whatever you spend on fees will be paid back many times over in liability protection. Remember, starting a limited liability company will protect your personal assets in the case of debt or liability assumed by your business.

As one can see, none of the steps involved in how to start a limited liability corporation are overly costly or time consuming. And even if you are having difficulty with the various steps in the process it possible to seek the help of an entity that can aid in drafting and processing the paperwork. Usually, this is done for a relatively nominal fee.

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