How to Set Up a LLC Company
Setting up a LLC is a major decision to undertake by any business. Getting advice about the pros and cons of starting a limited liability company is the first thing to consider.
Likewise, it would require more of your time and money.
Steps on Becoming a LLC
Starting up a LLC has become popular in the recent years. This is because small businesses want to become corporation. Before small businesses become a LLC, there are several requirements to accomplish set by the state. The first step that you should do is to secure copy of LCC Articles of Organization from the state. Likewise, you should look for specific rules pertaining to the creation of business names. After you obtain it, the next step is to select the possible business name. Make sure that it complies with the rules in creating LLC business names promulgated by the state. Usually, there are some prohibited words that should be avoided when making a business name that includes “Corporation”, “Insurance”, “Incorporated” and many others. In like manner, the business name should end with LLC designator.
On the other hand, when filling out the form you should provide all the necessary details such as the business name, principal office address, business purpose as well as the registered agent but you need not specify the management structure as early at this point. Another step that you should pay attention is publishing the notice in the local newspaper about your intention of forming an LLC. After which you should submit the accomplished form to the Secretary of the State and pay the filing fee. Aside from the legal requirements you should not forget to develop the Operating Agreement that is also important in creating an LLC. The Operating Agreement determines the management and financial responsibilities and rights of the LLC members.
Reasons of Setting Up LLC
Protecting the business owners from liability is the major reason of setting up LLC. This kind of business registration bounds the owner’s liability on investment in the business. This means that the business owner is not responsible about the liabilities incurred during the operation. Another reason is the taxation purposes. The good thing about the Limited Liability Company is that they only pay taxes once as compared to other form of businesses.
On the other hand, when planning to set up a LLC you should hire a lawyer to do the job that is fairly complex. It is recommended to study all the details regarding the operating agreement to avoid any issues along the way. In like manner, before deciding in switching in this form of business you should think it over if there is really a need to incorporate in a limited liability company. With all the important details stated above, you can have clear view of how a LLC works.
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