When you are starting a limited liability company, you are going to have your hands full with paperwork and registrations. To make sure you get everything done, use this checklist to guide your process.
1. Choose a business name: As a limited liability company, most states will require you to include LLC or some similar variation in your official business name. You and your partners should make a ranked list of your ideal names for the company. Avoid common words or industry phrases, which may be difficult to trademark. Keep your name simple and try not to limit the scope of your services in case your company expands in the future.
2. Check name availability: The reason you should go with a list instead of just one potential business name is you never know what existing trademarks will cause conflict. Your name not only has to be unique, but also not confusingly similar to an already registered trademark. Your search may start with a search engine, but you will need to search government databases for registered trademarks. Additionally, you should search for unregistered trademarks that could cause conflict.
3. Register your name: First, you will need to register your name on the state level. While sole proprietors don’t have to register at the state level, most LLCs do. Typically, you will do this through your state’s secretary of state office. Next, you should consider registering your name for federal trademark protections. Your application will have to be filed with the United States Patent and Trademark Office. Having official trademark rights makes it much easier for you to protect your brand and prevent other businesses from using the goodwill of your name.
4. Enact an LLC operating agreement: Even if this is not a requirement in your state, you should still have one drafted. Your LLC operating agreement will dictate much of how the company is run in the future. First and foremost, you will define the parameters of your limited liability, which can act as a protection if any legal action is filed against the business later on. You should outline the management distinctions and establish ownership of the company, including percentage allotments for each owner. The agreement should dictate shares for losses and profits as well as relevant special considerations. Also lay out the terms of voting rights and ownership transfers.
5. Write your articles of organization: Luckily, most LLC owners don’t need to draft their articles of organization completely from scratch. Many state governments provide fill-in-the-blank type templates to help streamline the process. Your articles of organization simply contains basic data about your new business like the entity’s name, address, managers and members. Before you submit your information, you may want your legal counsel to overlook the documents and agreements.
6. File your articles of organization: After completing your articles of organization, you will have to file the articles as a single document with your local secretary of state or the appropriate office in your state that handles them. Depending on your location, you may have to pay a fee when you file your document. The specific amount will vary from state to state.
7. Obtain the appropriate licenses and permits: You will have to obtain federal, state and local business licenses for your LLC. Depending on your industry and specific services, you will have to apply for relevant licenses or permits such as those for sale of alcohol, tobacco or firearms. Additionally, you will need to get an EIN, or employer identification number, for your future tax returns.
Setting up an LLC can be complex so it is important to carefully evaluate the requirements for each step and make sure that you have not overlooked anything.
The content on our website is only meant to provide general information and is not legal advice. We make our best efforts to make sure the information is accurate, but we cannot guarantee it. Do not rely on the content as legal advice. For assistance with legal problems or for a legal inquiry please contact you attorney.