- Internal Revenue Service (IRS) Form SS-4
- Name Reservation Application
- Articles of Organization
- Operating Agreement
- Initial and Annual Reports
- Tax Registrations
Starting a business and being their own boss is the dream for most people in the US. Anyone with a great idea immediately thinks about how to make money from it. About 69% of entrepreneurs launch their business from home, with no need for LLC formation documents, so it is an informal arrangement at the start.
However, anyone engaging in business in the US will have to register it at some point. A full 86.6% of small businesses with no employees are sole proprietorships, many of which eventually become a limited liability company or LLC.
It is easy to create a sole proprietorship because you do not have to register it with the government. If you conduct business without registering it as anything else, you are a sole proprietor. As such, you pay personal taxes,and you have complete control over your company.
However, it comes with risks, primarily personal liability for debt and lawsuits. If you are a sole proprietor, there is no separation between your personal and business assets. It can also be harder to get a loan or investors as a sole proprietorship.
If you want to retain control over your business but protect your personal assets, you might want to form an LLC as soon as possible. A single-member LLC is like a sole proprietorship, but it limits your personal liability in the business, hence the name. To know more about it, check out this overview on LLCs.
Registering an LLC in the US requires the submission of quite a few legal documents. The following sections will walk you through how to get LLC formation documents.
1. Internal Revenue Service (IRS) Form SS-4
The first thing you need for formation documents is an Employer Identification Number (EIN). You need to register with the Internal Revenue Service (IRS) to obtain the EIN for your business using the IRS Form SS-4.You can only apply for one EIN a day, and only one EIN can be associated with each LLC.
To be eligible to get an EIN, you must be:
- Registering a business located in the US or any of its territories
- A registered taxpayer
You have three options for applying for an EIN. The easiest is to apply online from Mondays to Fridays from 7 a.m. to 10 p.m. Eastern Standard Time. Complete the application in one session or you have to start all over again. You may get your EIN immediately after all validations are done.
However, you cannot apply online if you, as the responsible party, have already obtained one online. You will have to apply for subsequent EINs by mail, fax, or phone.
You can also apply by mail or fax by filling up IRS Form SS-4 completely and printing it out. You can send it to the appropriate number or address. If you send your application by fax and you are eligible for a new EIN, you will get it within four business days. If you send it by mail, expect a response in four weeks.
Individuals outside the US may apply for an EIN over the phone by calling 267-941-1099 (not toll-free) from Mondays through Fridays, 6 a.m. to 11 p.m. EST. You must be ready to answer the questions in Form SS-4 during the call and be eligible to receive the EIN. You may also designate someone to obtain the EIN and supply the answers for Form SS-4.
For more information on your tax obligations as an employer, refer to the 2023 Employer’s Tax Guide.
2. Name Reservation Application
Once you have obtained an EIN to register an LLC, the next step is to choose an entity name. To check for name availability, you will have to run a search in the corporations’ bureau or secretary of state website of the state where you intend to operate to find out if it is still available. Each state will have rules for ensuring that an LLC name is substantially different from existing businesses.
In Utah, for instance, using the plural form of an existing business name is insufficient for making a distinction. If your preferred name,”Cookie Monster,” is already taken, you cannot try to register “Cookie Monsters” instead.
You also need to check if the name you want is not prohibited or restricted. In Utah, you cannot use words that might create the impression that you are a government entity, such as “Bureau” or “Department.”
Check the state’s corporations’ bureau or secretary of state website for such rules to ensure the name you reserve will be acceptable. Once you have a name, you should file and pay to reserve the name so the state will prevent anyone else from getting it until you complete all your LLC documents. A name reservation is not required, but it is recommended. Note that states have different holding times for business names. Utah holds it for 120 days. California holds it for only 60 days.
3. Articles of Organization
The next step is to submit articles of organization, certificate of organization, or certificate of formation to the state. Go to the relevant secretary of state website to download the form. For example, this is the form for New York.
Be sure to fill up the form for the requisite number of copies for the state or risk rejection of your application. Most states, such as New York, require two copies of the articles of organization: one stays with the state, and the other is stamped and returned to you for your records. The articles of organization in New York carry a filing fee of $200.
Each state will have its own set of requirements, but the articles of organization typically include the following details:
Your business name
This is the name of the limited liability company you have chosen that complies with all state conventions. You should have reserved this previously to ensure it is still available.
Depending on the state, the business purpose may be a general or specific statement. A general-purpose statement may be something like, “The purpose of ABC, LLC, is to operate business activities as legally permitted in the state of X.”
A specific statement of purpose may be something like, “The purpose of DEF, LLC, is to buy, sell, hold, and operate real estate in the state of Z, including other legal acts as permissible for limited liability companies in the state of Z.”
Principal place of business
You must provide a physical address (cannot be a P.O. box) to serve as the headquarters or base of your operations. The location must be in the US or any of its territories.
A registered agent (known as a statutory agent in some states, e.g., Arizona) is an individual or entity with a physical mailing address appointed to be available to accept official mail and service of process (delivery of lawsuit notices) during business hours on behalf of your business. You can nominate yourself, your business (in some states), or a professional registered agent.
You need to specify if members manage your LLC or if you will designate managers who are not LLC members. You will also need to provide their names and contact information.
Duration of LLC
Some states may require you to specify a date when the LLC will end as a legal entity or a dissolution date. If you do not put a dissolution date, the state will impose the statutory limit on the LLC, if any, which is typically a few decades long. In Arizona, the statutory limit is 30 years. States that do not require you to specify duration assume it will be of perpetual duration.
If you need help understanding the requirements to form an LLC, get in touch with experts from doola today.
“Did you know that one of the many advantages of the LLC is that you can choose the taxation process that works best for you?”
4. Operating Agreement
The operating agreement includes many of the elements in the articles of organization but will be more detailed. Some states refer to it as a company agreement. In either case, it sets the rules for running the LLC and the responsibilities and rights of members. The operating agreement also establishes the distribution of profits and losses among members, typically basing each member’s income (from profits) on ownership shares.
Only Delaware, California, Missouri, Maine, New York, and Nebraska currently require LLCs to provide even then, it would still be a good idea to have one to establish how the LLC will be run. All LLC members must validate the agreement to make it valid.
As legal LLC formation documents, operating agreements will include the following:
- Business name and address
- Registered agent address
- Formation date and duration
- Member names, roles, and contact information
- Process for adding or removing members
- Contributions and shares of ownership
- Distribution of profits/losses as well as compensation plans
- Manager names and contact information
- Meeting schedules and voting rights of members
5. Initial and Annual Reports
Because an LLC is a registered business entity with the state, you will need to present updated and accurate records as a basis for information on your operations within state borders. Most states require you to file reports periodically and refer to them as annual reports, business entity reports, statements of information, or annual certificates.
Not all states will require you to submit annual reports, however. Pennsylvania requires a decennial filing, meaning you only have to file a report to the state every ten years. The purpose is to establish that the LLC is still in operation and identify LLC names or marks that may no longer be in use. In other words, if you don’t file a decennial report, the state of Pennsylvania will assume your LLC name is available for other entities.
Some states, such as California and Nevada, require that LLCs file a statement of information or initial report as part of LLC formation documents. You will have to present the report at the time of registering an LLC in the US.
6. Tax Registrations
The EIN is the identifying mark for your LLC when it comes to the IRS. However, you will still need to register for the specific tax type that may apply to your LLC according to state requirements. These may include the following:
- General business entity taxes
- Sales taxes
- Employer taxes
- Use taxes
You can find out the tax registration requirements and registration forms on the relevant state’s business website. Since most LLCs are pass-through entities, the LLC does not pay income tax. An LLC registered in Pennsylvania will require members to pay state income taxes on profits they receive as a shareholder of the LLC. However, Pennsylvania also requires certain LLCs to file and pay a Certificate of Annual Registration before April of every year.
Got questions? Get in touch with doola today.
You can complete all LLC formation documents and fulfill your state’s requirements to establish and maintain your business on your own. However, it does take time away from core business tasks that will help you grow your business. Additionally, the different requirements might leave you scratching your head. The best thing you can do to avoid any issues with your LLC is to get in touch with doola today.
We have helped many entrepreneurs successfully set up their LLC and C Corporations, and we don’t require any documents from you. All we need you to do is choose the state where you want to set up your LLC and fill up this short form to get started. We will handle everything from there. We will even apply for a EIN (Employer Identification Number) for you if you don’t have one.
If you have an SSN, the whole process up to and including setting up your bank account will take 17 days at most. In some states, such as Wyoming, we can get your LLC up and running in 5 days.
How do we get it done so fast? LLC and C Corp formation is what we do and all we do. You can give your entrepreneurial spirit full rein knowing doola handles all the LLC formation documents and entity maintenance you need to be in a good place with your state.
Got more questions? No worries. Chat with us online now.
LLC formation documents FAQs
What documents are required for an LLC?
The specific requirements will depend on the state where you will register your LLC, but most will require the following LLC formation documents:
Internal Revenue Service (IRS) Form SS-4 (for the EIN)
Name Reservation Application
Articles of Organization
Initial and Annual Reports
If you use doola to set up your LLC, you will not need to provide any documents. All you need to do is to fill up this short form. You will need to provide a copy of your passport when the time comes to open a bank account.
How do I get a copy of my LLC certificate?
An LLC membership certificate is a document created by the LLC to designate specific units of interest or ownerships to an LLC member. You can request a copy of your LLC certificate from the designated agent if the LLC has issued one to its members. Not all LLCs must issue membership certificates, but it can be useful when the LLC has several owners or investors.
What is an LLC certificate of formation?
A certificate of formation is the term used by some states (Delaware, Alabama, Maine, New Hampshire, Mississippi, New Jersey, Washington, and Texas) to refer to the articles of organization of an LLC. Another term for the certificate of formation is the certificate of organization used in Pennsylvania, Utah, Idaho, Iowa, Connecticut, and Massachusetts. They all refer to the main document filed with the state’s secretary of state when forming an LLC.