Steps To Set Up Your LLC– Its easy and Affordable!
Good news! it's a simple process and should take you relatively little time to form an LLC into a legal reality. The biggest misconception is that you need to hire a lawyer or a use a formation company to form your LLC because it is a complicated process. This could not be further from the truth! Today, many States have online websites where you can Check Name Availability and complete the Articles of Organization on your own. It's easy and quick! The only document you should consider using a professional service for is the Operating Agreement, but that does not mean you have to use a lawyer and pay astronomical lawyer fees. We will get to that in a bit…
There are 4 easy Steps to set up your LLC:
- Check Name Availability
- LLC Articles of Incorporation
- LLC Operating Agreement
- Obtaining an Employer Identification Number (EIN)
Step 1 - Check Name Availability
Generally, an LLC may use any permissible name that is not the same as or deceptively similar to existing corporations, partnerships, limited partnerships, or other LLCs. There is no fee to verify that the name you have selected for your new LLC is available. The service is 100% FREE!
Note: Most states do not require you to reserve a name for your entity before forming your LLC.
Step 2 - Form Your LLC
Prepare and file LLC Articles of Organization with your state's LLC filing office. A few states require an additional step: the publication in a local newspaper of a simple notice of intention to form an LLC prior to filing your Articles of Organization. These states are New York (within 120 days after filing), Arizona (within 60 days after filing) and Nebraska (no time period set).
You can prepare your own in just a few minutes by filling in the blanks and checking the boxes on a relatively simple form provided by your state's LLC filing office. For many states this is available online. It’s that easy! In just a few minutes, you could do the filing on your own saving you thousands of dollars in wasted legal fees. Dollars that you could use to invest in your business! Typically, you need only specify a few basic details about your LLC such as the name of your entity, address, and the LLC's purpose. It's that easy!
What about formation kits & certificates?
Simple; they are a waste of money and serve absolutely no purpose! Formation kits and member certificates are not required by any state LLC statute and are not provided by attorneys that form LLCs. They are only sold so that formation companies can take more money from you. FormLLCDirect does not offer these products because they are not needed and are generally a waste of money for LLCs and its owners.
Step 3 - Get A Customized LLC Operating AgreementLLC Operating Agreement
An LLC should always create an operating agreement to define the basic rights and responsibilities of LLC members. The Operating Agreement is the most important document for your LLC. It is the core document that is referred to when issues concerning the LLC and its members need to be resolved.Single Member Limited Liability Company
It is extremely important that you create an operating agreement to separate yourself as an individual from your LLC, even if you are the sole owner (“member”) of your LLC. Without the formality of an agreement, the LLC can closely resemble a sole proprietorship, which does not limit your personal liability for business debts of the LLC. In addition, without an LLC operating agreement, the basic operation of the LLC would be governed by state law, which may not be advantageous to the LLC, its member, or the business it conducts. In fact, some states like New York require an LLC to have an operating agreement.
The operating agreement governs the operation and management of the LLC. The agreement should also reflect the member's financial contribution to the LLC and the value of that contribution.Multi-Member Limited Liability Company
It is extremely important that you create an operating agreement for your LLC entity. Without the formality of an agreement, the basic operation of the LLC would be governed by state law, which may not be advantageous to the LLC, its members, or the business it conducts.
The operating agreement governs the operation and management of the LLC. It describes the business and economic arrangement of the members greatly reducing the likelihood of disagreement between them in the future over critical issues such as:
- Voting rights
- Additional capital contribution requirements (the money invested in the business)
- Are owners entitled to periodic draws from the profits of the business?
- May members leave the LLC anytime they wish and expect an immediate payout of their capital contributions?
- How much should an owner be paid when he or she decides to leave the business?
- Is a departing owner allowed to sell an interest to an outsider?
- A lender may request it to obtain financing
We strongly encourage you to create your operating agreement at the time you form your LLC.
That is why FormLLCDirect has joined forces with MyLLCAgreement.com to offer you a law firm quality operating agreement at a special low price. Sharing a similar philosophy as FormLLCDirect, MyLLCAgreement.com was created by corporate and tax attorneys from some of the largest law firms in the country, who became tired of seeing entrepreneurs and business owners spend thousands of dollars on legal fees for a LLC Operating Agreement. MyLLCAgreement.com was founded on the belief that entrepreneurs and business owners deserve to have a law firm quality LLC Operating Agreement without the law firm price.
FormLLCDirect has negotiated a special discount for all FormLLCDirect users with MyLLCAgreement.com, the leading online provider of customized LLC Operating Agreements. Enter rebate code: FLD242 on MyLLCAgreement.com Purchase Confirmation Page to receive your special discount.
Step 4 - Getting A Federal Tax ID Number
An Employer Identification Number (EIN) is also referred to as a Federal Tax Identification Number. The EIN is generally used to identify a business entity. In general, every business requires and EIN.
You can obtain an EIN free of charge on the IRS website.
FormLLCDirect is here to provide you with access to all formation questionnaires a/nd forms necessary to set up an LLC in all 50 states as well as guide you through the process in 4 simple steps. There are no hidden fees.FormLLCDirect was created to give entrepreneurs and business owners the knowledge and tools to effortlessly from an LLC for Free. FormLLCDirect is here to help you!