How to Apply for an LLC
How to Apply for an LLC
You've done your research on the best corporate structure for your new business, and have decided you want to start an LLC. Registering your new business as an LLC is not, fortunately, a particularly complex procedure.
While the procedure for applying for an LLC is not complicated, however, there are a number of steps that you need to follow in order to make sure you form an LLC properly. The LLC application process itself is fairly easy, and many states now offer the option to apply for LLC online, as well as the more traditional options of mailing in your form and filing fee or filing the proper papers in person.
How to Apply for LLC
The following steps provide basic guidelines for forming an LLC properly. Depending on the state in which you will be starting an LLC, you may not have to take all the steps outlined below. Your state business office will be able to provide you with more information on what particular steps you will need to follow for properly setting up an LLC.
1. Choose a business name. It's important to spend some time thinking about your new LLC's business name. In addition to choosing a good name for business and marketing purposes—for example, one that will help you build and establish brand identity—there are other important, legal considerations as well.
First, your LLC's business name will need to indicate that your business is, in fact, an LLC; this means you will need to use a designation such as "LLC" or "Limited Liability Company" as part of your name. You also can't include in your name any words that your state has restricted from being used in an LLC name. For example, words such as "Bank" or "Insurance" are commonly restricted by most states. Check your state's list of restricted words to make sure your chosen business name doesn't contain any words it shouldn't.
Another important step is to make sure your proposed business name doesn’t infringe on any existing trademarks—this step can save you a lot of headache in the future. You can check for potential infringement by doing a search online using the Trademark Electronic Search System (TESS); TESS is a database of registered trademarks and prior pending trademark applications maintained by the U.S. Patent and Trademark Office; while a search isn't required, it's a smart business move, as you'll be able to see if a trademark has been registered or been applied for which might be too similar to your proposed LLC name.
2. Check the availability of your business name. Once you've chosen a business name, the next step is to make sure it's not already being used by another, existing LLC in your state. Your state's business office should be able to provide you with further information as to how you can determine if another LLC is already using your proposed business name. If your proposed business name is available, your state may also permit you to temporarily reserve the name until you're able to get your documentation filed. In most states, your business name will be automatically registered when you file your articles of organization, so you likely won't have to register the name separately.
In addition to ensuring the name you've chosen isn't already used by an existing LLC in your state, you also want to be sure you can purchase your business name, or some acceptable permutation of it, as a domain name. The WHOIS database is a handy tool for performing such searches. If your proposed name is available as a domain name, it's a good idea to purchase it as soon as possible so you don't run the risk of losing it to another domain name buyer.
3. Register a DBA name (optional). Most LLCs operate under their business names, but if your plan is to run your LLC under a name that's different from its business name, you will need to register a DBA name. Also known as an assumed name or a trade name, a DBA name is a name that's different from your LLC's officially registered business name. Not all states require that a DBA name be registered, so check with state authorities to determine the process you'll need to follow if you're planning to use a DBA name.
4. File your LLC's articles of organization. When creating an LLC, you will need to file articles of organization with your state—"articles of organization" is the name used by most states, but your state may refer to the document by another name, such as a certificate of formation. The articles of organization is typically an easy-to-fill-out document which you can obtain from your state's business or filing office; in many states you may also be able to download a blank copy of the form online. While the information that will be required varies from state to state, you will usually need only to provide the name and address of your LLC and the names of its members.
Once you've filled out your articles of organization, you will need to file it, along with the appropriate filing fee, with your state; in most states, filing your articles of organization is usually done with the Secretary of State, but some states might require you to file it with another office. The Small Business Administration maintains a list of links to state business offices on its website; check this list for the link to your state's business office, where you can obtain more information about the proper place to file your articles of organization as well as the required filing fee, if any.
5. Designate a registered agent. Most states require an LLC to designate a registered agent. A registered agent, also known as an agent for the service of process, is the person who will receive service of process notices, government correspondence and compliance-related documents on behalf of your LLC. Most LLCs will usually designate one of the LLC members to act as registered agent.
6. Draft an operating agreement. While most states don't require an LLC operating agreement, it's still an extremely wise move to have one. An operating agreement is an essential document which provides structure for important internal business decisions. Operating agreements often cover matters such as percentage of ownership among members, voting rights and responsibilities, members' powers and duties, and provisions governing the transfer of members' interests. It should also be noted that, while most states don't require operating agreements from LLCs, some states do; you should check with your state to see whether an operating agreement is a requirement.
7. Publication Requirement. In some states you may be required to publish a notice in your local paper announcing the formation of your LLC. If your state has such a publication requirement, check with your state's business filing office for more information regarding the content of the notice, how many times it must be published and any other requirements which may apply.
8. Obtain business permits and licenses. Once you've registered your LLC, you'll need to obtain any business permits and licenses which may be required for running your business. The types of permits or licenses which you'll need will depend on both your state and your local government requirements, and also on the industry your LLC is in. The Small Business Administration website maintains a list of state business license offices here.
9. Open a bank account for your LLC. It's important that your LLC has a its own bank account; a separate bank account serves to separate your LLC's funds from the personal funds of its members. Different banks will have different documentation requirements for opening a bank account for an LLC; check with your bank to see what documents you should bring when opening up your LLC's account.
Starting an LLC requires time to do the proper research, paperwork, and of course waiting on the Secretary of State to file your paperwork.
LegalZoom can help you apply for an LLC online. Answer some questions about your business in our online questionnaire and we’ll use your answers to assemble the paperwork you need, file it with the Secretary of State, and even help you get a registered agent and independent attorney advice.