How to Start an LLC in Pennsylvania
How to Start an LLC in Pennsylvania
LLCs in Pennsylvania are affordable and easy to form. And as with other states, the State of Pennsylvania has some unique LLC requirements.
Interested parties must register with the Department of State by filing the necessary forms, paying the necessary fees and meeting all naming and formation requirements.
The specifications required of a Pennsylvania LLC are:
Registration. LLCs are required to complete and submit a Certificate of Organization (form DSCB: 15-8913) and a Docketing Statement (form DSCB: 15-134A) to the Corporation Bureau, Department of State. This can be done by mail, via fax or in person. The certificate must include the following pertinent information:
- LLC name
- Registered agent’s name, if applicable, or a registered address
- Each organizer’s name and address
- Type of management (member-managed or manager-managed)
- Specific effective date, if other than the filing date
- Kind of professional services the LLC will offer, if applicable
- Dated signatures and addresses of all organizers
- One copy of a completed New Entity Docketing Statement (form DSCB: 15-134A)
- Copies of Consent to Appropriation or Use of Similar Name (form DSCB: 17.2.3), if applicable
- Any necessary government approvals, if applicable
All documents submitted must be accompanied by the payment for the filing fee.
Forms and fees. LLC registrants are required to complete and submit a Certificate of Organization with the Department of State. There is a filing fee that must be paid upon submission of the documents.
Timeline. The usual processing time for documents and filing is less than five working days, unless document submission volume is dense. The five-day processing time does not include mailing time. Walk-in submissions will be processed while you wait.
Naming requirements. LLC naming requirements can be confusing. However, the easiest way to ensure that your LLC name will be approved is to make it distinguishable from other LLCs and to include specific words required of LLCs. You may opt to have a preferred name checked for availability before filing your LLC formation documents with the Department of State.
Formation requirements. To form an LLC, a registrant must first file a Certificate of Organization and a New Entity Docketing Statement form with the Department of State. All submissions must be accompanied by the filing fee.
An LLC with more than one member is also strongly advised to have a limited liability operating agreementamong its members.
Starting an LLC in Pennsylvania
Before you begin the registration process for a Pennsylvania LLC, it’s important to know what an LLC is and whether or not it is a viable business structure for your company, so be certain to read up on the definition and benefits of an LLC.
These steps will guide you through the LLC registration process with the Pennsylvania Department of State:
1. Decide on a name for your business. You can choose any name for your LLC as long as it ends with “Limited Liability Company,” “Company,” “Limited” or any variation of its abbreviation—e.g., LLC, L.L.C., Ltd. or Co.
Names may be reserved for up to 120 days. You may file a name reservation application with the Department of State Corporation Bureau by submitting a written or fax request and required fee. Reserved names can be renewed for an additional fee if before the expiration date.
You may also have a preferred name checked for availability by accessing the Pennsylvania Department of State website.
2. Assign an agent for service of process. This is also referred to as the registered agent.
3. Get an Employer Identification Number (EIN) from the IRS. If there are two or more members in your LLC, your company will need to obtain an EIN from the IRS, for tax purposes.
4. Create an operating agreement. Although LLCs in Pennsylvania are not required to have a limited liability company operating agreement, it is wise to have one in place with other members should your LLC have more than one member. The State of Pennsylvania recognizes limited liability company operating agreements as governing documents.
5. Familiarize yourself with the LLC’s continuing legal obligations, specifically annual filings. Any restricted professional company is required to file a Certificate of Annual Registration along with the registration fee on or before April 15. Failure to file the annual registration can result in additional fees, penalties and interest. Other continuing legal obligations may include, but are not limited to, state taxes.
Filing an LLC and Fees
Following are the forms and fees that are required when starting an LLC in Pennsylvania:
1. Forms. Complete and submit a Certificate of Organization, along with the required filing fee, to the Pennsylvania Department of State.
2. Fees. The filing fee for a Certificate of Organization must accompany your LLC application.
3. Limited liability company operating agreement. Although the LLC operating agreement is not submitted with the Certificate of Organization to the Department of State, it is a good idea to have one in place for LLCs with more than one member. This document should be kept on file by the registered agent.
4. Taxes. LLCs in Pennsylvania are treated as corporations, limited liability partnerships or single-member LLCs and are subject to federal income tax classifications. Depending on the type of taxation you opt to have for your LLC, you will have different federal tax responsibilities. a) An LLC treated as a limited liability partnership. Per Pennsylvania state law, an LLC treated as a partnership must file a PA S Corporation/Partnership Information Return form (PA-20S/PA-65) with the Pennsylvania Department of Revenue.
b) An LLC treated as a C corporation for federal tax purposes. Per Pennsylvania state law, an LLC treated as a corporation for federal income tax purposes must fill out the corporate net income tax portion of the PA Corporate Tax Report (RCT-101).
c) An LLC treated as an S corporation. Per Pennsylvania state law, an LLC treated as a partnership must file a PA S Corporation/Partnership Information Return form (PA-20S/65) with the Pennsylvania Department of Revenue.
d) An LLC treated as a sole proprietorship. Per Pennsylvania state law, an LLC treated as a disregarded entity for federal income tax purposes must attach a complete copy of its federal income tax return to its RCT-101.
You should always make sure to acquaint yourself with the state laws regarding taxation, as your LLC may be subject to other taxes akin to the kind of business your LLC is involved with.
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