A limited liability company is one method of structuring a business in Florida, but you'll want to ensure you handle the paperwork the right way.
Starting a business in Florida is an exciting time in your life. After all, you could be putting yourself on the path to financial freedom if your company reaches the heights you think it can.
But running a business isn't without its challenges. For starters, you'll have to develop a business plan that puts you on the path to success. It's also vital that you legally register the company and structure it in a manner that suits your needs.
You have a few options for your business' legal structure: You can go with a partnership, a sole proprietorship, a corporation, or a limited liability company (LLC). You must understand the differences between these structures because they will influence your financial liability and taxes.
An LLC is often advantageous because it combines the personal asset protection of a corporation with the flexibility and simplicity of a sole proprietorship. You won't need directors, officers, or shareholder meetings, and you'll have the final say on how you're taxed based on what works best for you.
If you're running a small business but want the same asset protection as a corporate entity, an LLC is an option worth considering.
Here are six steps to creating an LLC in the state of Florida.
1. Name the company
Before anything else, you'll need to choose a name for your company. Florida law states that your business name must contain the words “Limited Company” or “Limited Liability Company” in the official title. You can shorten these words using abbreviations like “LC” or “LLC” if you wish.
Your company's name must also be distinguishable from all other businesses registered with the Florida Division of Corporations. So, if you select a name that's too close to that of an existing business, there's a chance you'll receive a rejection letter.
2. Determine the registered agent
Every LLC in Florida needs a registered agent for the service of process. It's this agent's job to receive all legal paperwork on behalf of the LLC if someone sues the organization. The registered agent is generally the owner of the business.
It's worth noting that the registered agent must have a physical address in Florida. The individual doesn't have to live in the state year-round, but they need a street address and must be authorized to do business in Florida.
3. Submit Articles of Organization
As you create the legal documents to file with the Florida Division of Corporations, you'll need to fill out the Articles of Organization. There's a $125 filing fee associated with this paperwork that you must include with your application. There are also optional fees for a certified copy of your documents and a certificate of status.
These articles must be included in your paperwork:
- The mailing address of the LLC's main office
- The name and address of the registered agent
- The names and addresses of any additional LLC managers that exist
You also note the LLC's start date and have the registered agent, a member, or an authorized representative sign the document.
4. Create an operating agreement
Although an LLC operating agreement is not a legal requirement in Florida, your lawyer will recommend it because it determines how the company will run. The operating agreement is an internal document that clearly sets out the rights and responsibilities of every member and highlights how you'll manage the LLC.
Your operating agreement also comes in handy when protecting your limited liability status because it proves the company is separate from any other business entities you're operating. If you don't have an operating agreement, Florida LLC law will take precedence over how the company operates.
5. Get your Employer Identification Number
Your next step is receiving an Employer Identification Number (EIN) from the IRS. You'll need this number if the LLC has more than one member, even if you're not hiring any additional employees. You'll also need an EIN if the LLC only has a single member but you plan to hire employees or you want to be taxed as a corporation.
Obtaining your EIN is a separate process from filing your LLC paperwork because you'll apply directly through the IRS. Still, it's an essential step to take before you're ready to operate the business in Florida.
6. Turn in an Annual Report
Once you receive approval and begin operating as an LLC, you'll need to file an Annual Report every year to preserve your active status. File the first report in the year following the formation of your LLC between January 1 and May 1, you can submit the entire document online.
There's a $138.75 fee associated with submitting this report, and you could have to pay a $400 late fee if you don't send the documents in on time. Failing the file an Annual Report by the third Friday of September will lead to the dissolution of the LLC.
Getting help with your LLC paperwork
Forming an LLC can be a bit confusing and overwhelming because there's so much paperwork involved in the process. However, there is legal assistance available that can put you on the right track.
When you hire an attorney to assist with the formation of an LLC, all you'll have to do is provide the LLC's name and address, along with the name and address of the registered agent, members, and managers. From there, the lawyer will create an LLC package, including the Articles of Organization and operating agreement.
PeytonBolin provides LLC creation assistance for businesses in Florida. Once you reach out to us, you'll receive your LLC creation package within five business days, so all you'll have to wait for is the State of Florida Division of Corporations to accept your filing.
Contact PeytonBolin today for more information on LLC creation in Florida.