How to form and file an Limited Liability Company (LLC)

Deciding what type of business structure you will use for your business is an important decision you will need to make. A very popular business structure Americans are using now is the formation of an Limited Liability Company (LLC).

The following article gives tips on how to form and file an LLC.

Things You'll Need

• business
• effort

Instructions

1. Know what an LLC is:

   A Limited Liability Company (LLC) is a business formation that combines the features of a Corporation and a partnership. An LLC is not a corporation. However, it does offer its members limited liability like shareholders in a corporation. A big advantage is that its profits are not double taxed like corporations. However, setting up an LLC is a bit easier to operate and set-up than corporation.

2. File Articles of Organization with your state:

   The major requirement in setting up and filing an LLC is to file articles of Organization with the Secretary of State and pay all of the fees. Many state websites offer a articles of organization template that you can just fill in the blanks and submit.

3. Write an operating agreement:

   Although many states do not require you to submit an operating agreement, creating one is highly recommended. An operating agreement defines profit-sharing, duties, ownership, and other company rules and regulations. Having an operating agreement can help dissolve any disputes that may come up within the company.

4. Meet all other state requirements:

   All states are different in their LLC requirements. It is very important that you review your individual state's LLC requirements before completing formation. Most states have a website that post requirements in forming an LLC.

Tips & Warnings

• If issues get too complex, consult with a tax adviser or attorney.