Setting up an LLC in Wyoming sounds easy, but it’s not always the case. Doola outlined the steps in this article. Read on.
Forming a Limited Liability Company (LLC) in Wyoming can be easy if you are familiar with the requirements and the process. Being a member of an LLC also comes with several benefits, including flexible profit sharing and limited personal liability.
But, before you establish your own limited partnership business, you will need to know the relevant laws applicable in your case. Read on to know about the ins and outs of the Wyoming Limited Liability Act.
Overview of Wyoming Limited Liability Company Act
Wyoming is the first-ever state that allowed the existence and operation of limited liability companies (LLC) in 1977. After this, other states decided to follow suit, especially when the Internal Revenue Service (IRS) granted these LLCs better tax status. As years passed, these LLCs thrived, which is why business owners preferred them over other business entities.
LLCs can keep such information as members’ names, managers’ names, number of members, nature and amount of capital, and other similar information;
More flexibility in terms of operating agreements, allowing those that are of contractual in nature;
Ability to enforce oral operating agreements and waive some members and managers’ fiduciary duties; and
Possibility of having more than one person to serve as the LLC organizer.
If you’re unsure if this is for you, check out Doola’s answer as to why you should seriously consider forming an LLC company.
LLC Formation Requirements According to Wyoming LLC Law
The LLC laws provided the rules governing the running and starting of a Wyoming LLC. And according to the said law, here are the LLC formation requirements.
1. Pick a name for your LLC.
According to the Wyoming law, an LLC should include ‘limited liability company,’ ‘L.L.C,’ or ‘LLC’ in the company name. Aside from these, you can also use the following: Limited Liability Co., Ltd. Liability Co., Ltd. Liability Company, L.C., or LC.
If you’re forming a low-profit SMLLC, its registered name must also show this fact. You can do this by adding the following to its name;
Low-Profit Ltd. Liability Company;
L3C or l3c;
Low-Profit Limited Liability Co.; or
Low-Profit Ltd. Liability Co.
The name of your LLC has to be distinct from other already filed business entities with the Secretary of State. You can check the Wyoming Secretary of State database for the list of available names. By filing the Application for Reservation of Name with the State Secretary, you can reserve a name for 120 days. Note that the filing fee is $50.
In using your business’ trade name, you don’t need to use the LLC’s registered and legal name in your Articles of Incorporation when you do business in the real world. In place of this, you can use your trade name or ‘doing business as’ (DBA) name, fictitious business name, or assumed name.
Once you’ve chosen a name for your business, you can file an Application for Registration of Trade Name with Wyoming’s Secretary of State. You can do this by mail and by paying $100. To be approved, your business needs to have a physical address within the city. While the said registration is only voluntary, it will do your business good in the sense that it lets others know of your existence.
2. Choose and designate a Registered Agent.
According to the Wyoming LLC Act, every LLC in Wyoming needs a state service of process agent that will accept its legal papers once individuals and businesses sue the said LLC. The said agent could be a business entity or individual who should also register as such (an agent) with a Wyoming physical address.
3. File your Articles of Organization.
As you already know, you need to file your business’ Articles of Organization with Wyoming’s Secretary of State. The said document has to include the following:
Name of the registered agent;
Mailing address of the registered agent and LLC;
Main office address of the LLC; and
Contact information and signature of the LLC’s organizer.
Note that the articles of the organization must be complete, accompanied by a signed written consent to the appointment. This can be filed online or by postal mail.
4. Prepare the Operating Agreement.
While an LLC operating agreement is not mandatory, it’s highly advisable given that it establishes how the LLC should function. It also outlines the responsibilities and rights of the manager and members, especially when it comes to the management of the LLC. When you create an operating agreement, you don’t have to file the same with your Articles of Organization.
5. Keep Up with the Regulatory and Tax Requirements.
There might be additional regulatory and tax requirements that would apply to the LLC. Some of these could be the following:
Department of Revenue (DOR): There are cases wherein you’ll need to register with the city’s DOR. An example of this is selling goods. Since you’ll be collecting sales tax, you need to comply with the tax requirements provided by the city’s DOR.
Business License: Your LLC might need to secure other state and local business licenses depending on where you primarily operate. To know whether this applies to your business or not, you can check out the website of Wyoming Business Council.
If you’re unsure where to set up your business, check out Doola’s discussion on the difference between an LLC in Delaware and Wyoming here.
Wyoming LLC Registered Agent Statute
As mentioned above, your LLC needs to have a registered agent responsible for accepting documents on your behalf should you get sued. This agent could either be an individual or a business entity.
Since these agents will be accepting essential documents, the law requires them to have a registered office located in Wyoming. However, this registered address couldn’t be a virtual office or PO box. It shouldn’t be a home address either. So, instead of stressing yourself out with these requirements, you can hire a resident agent that already currently has these requirements.
These registered agents work according to W.S 17-16-501, which states that they must be a resident of the state and should also have a registered office address there. Although their job seems simple, these agents could save you and your business.
Aside from receiving these legal documents, their job includes scanning and uploading them into your drive or online account. They will also notify you of the same. You won’t miss important deadlines like hearings, court appearances, or annual report submissions through this.
Aside from those already mentioned, these agents must be a bearer of a written appointment form that signifies their representative status. Compliance with all these requirements mean their representation is valid and proper:
Need assistance to get your US business up-and-running? Contact Doola today to get the services and knowledge you need to incorporate.
“It is crucial that you choose a company name that complies with Wyoming naming requirements and is easily searchable by potential clients when you are creating an LLC in Wyoming.”
Wyoming LLC Operating Agreements
Wyoming LLC rulesprovide guidelines for creating and maintaining an LLC operating agreement. The LLC operating agreement gives LLC members the right to draft rules to run and operate their LLC. The said rules are usually called ‘provision’ or ‘terms.’
They have to note, however, that these operating agreements derived their powers from the state statute. As such, it can’t add provisions or terms that run counter to the state statute. It can prescribe the mechanisms and procedures, but it can’t give what the source law hasn’t provided.
Say, for instance, the state law prohibits LLC members from dissolving an LLC sans the consensus of all members. In that case, the LLC members can’t merely override or alter the statute by subsequently making an operating agreement contrary to it. Specifically, they can’t make provisos that explicitly or indirectly state that one or a few members can dissolve the LLC without consensus.
The operating agreement is binding to all members. It will also help members navigate peculiar situations relating to the LLC’s operation. Should a dispute or lawsuit arise, the courts or the members can go back to the operating agreement and use it as a reference.
If in case, the LLC members couldn’t resolve the issues that arise among themselves, the court can refer to the operating agreement to rule on the matter.
If you’re unsure how to create an operating agreement, consider adding these standard provisions:
Identifying information: You must include the LLC name, principal business address, and initially registered address.
Statement of Intent: This is a statement that expressly provides that your operating agreement is according to Wyoming state laws and that your business will only gain legal personality after its official LLC documents are submitted and filed with the Secretary of the State.
Purpose of the business: You need to add the nature and purpose of the LLC. End it with the phrase ‘and for any legal business purpose’ to cover other purposes not expressly stated.
Term: This contains the provision that says the LLC will subsist unless terminated following the operating agreement or dissolved following the state laws.
Tax treatment: You also need to include a provision on how you intend to be taxed — whether as a corporation, partnership, or sole proprietorship.
Provision on new member admission: Your operating agreement should also include a provision stating how you should admit new members into the LLC. You may start by yourself, but soon, you might need to admit more members, so this process must be straightforward in your operating agreement.
Aside from the standard provisions, here are some less common yet applicable provisions you might also want to include:
Manager and member identification: This includes the initial manager’s and members’ names, titles, and addresses.
Capital contributions: In this part, you need to list all contributing members of the company and their share capital in the form of cash, services, or property.
Additional capital share: While some businesses do not require members to make additional investments, others require it. If your LLC is of the latter kind, ensure that you have a provision in the operating agreement that states how these additional contributions can affect the member’s business interest.
Profit and loss distributions: This part of the agreement should state how the LLC members distribute their profit among the members. And since the LLC profits are often taxed and passed to its members, there should be an explicit statement on what happens if the distributions are not enough to pay the taxes.
Voting and meetings: This part discusses when the LLC members hole their meetings and what rules govern the said meetings. It should also include a provision on voting, what constitutes a quorum, and how many member votes are needed to act on a proposition.
Management: This part will discuss who is responsible for managing the LLC, along with a discussion on the compensation, limits of authority, and duration of service.
This list is not exhaustive as the parties to the LLC could add provisions they deem necessary to run and manage their business smoothly. They could also include provisions on how to transfer assets, asset protection, LLC cancellation, managing the death or absence of a member, and the dissolution and winding up of the LLC.
Wyoming LLC Annual Report Statute
According to Wyoming Limited Liability Company Act: 17-29-209, an LLC is mandated to submit an annual report to the Wyoming Secretary of State on or before the first day of your LLC’s month of organization. An LLC should also submit this yearly.
Specifically, the said LLC annual report must include the following information:
LLC’s mailing and principal office addresses; and
Statement of the LLC’s capital, assets, and properties employed and located in Wyoming.
Are You Ready to Form an LLC in Wyoming?
If you still want to explore more about starting an LLC in Wyoming, check out Doola’s in-depth discussion of these steps. They have a step-by-step, easy-to-follow guide on forming an LLC in Wyoming so that you won’t have a hard time catching up. You can also go through these at your pace and with your future LLC co-members.
And if, after going through the steps, you’re ready to start working on your LLC business, get help from the experts at Doola. You can take advantage of their professional services by booking an appointment with them here.
Wyoming Limited Liability Company Act FAQs
1. What benefits does an LLC in Wyoming have?
The main benefit of being an LLC in Wyoming is that the state doesn’t impose state income tax on them. Since the liabilities of the members are limited, their assets are protected. These properties won’t be used to repay obligations incurred by the LLC.
2. How much does it cost to form an LLC in Wyoming?
You only need to prepare $150 to $152 to form an LLC in Wyoming. You need to pay $50 to reserve an LLC name. Afterwhich, you need to pay $100 for filing your LLC application via mail and $102 via online filing.
3. Do you need a physical address for an LLC in Wyoming?
To be approved, your business has to be physically located in the city. You also need the physical address of your LLC in the city. PO boxes and residential addresses are not allowed.
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