What Documents Do You Need to Start An LLC?

KEY TAKEAWAYS 

• Articles of Organization, notarized by NotaryLive for remote convenience
• Operating Agreement outlining internal governance rules
• Obtain Federal Employer ID Number (FEIN) to open a business bank account

This is it! 

You have a great idea for the next major start-up, or maybe you have a dream to turn the passion you love into a career. 

The only thing standing in your way is making it official.

In honor of NotaryLive teaming up with MyCompanyWorks, here are the documents you need to start an LLC.

While it might sound like a lot of paperwork and coordination, starting an LLC can be quite simple thanks to MyCompanyWorks, the platform that makes starting a business as simple, fast, and inexpensive as possible. 

Since it was founded in 2001, MyCompanyWorks has grown into one of America’s largest providers of incorporation, LLC formation, and other small business services.

1. What is an LLC?

A Limited Liability Company (LLC) provides the easy management and pass-through taxation of a Sole Proprietorship/Partnership, with the liability protection of a Corporation. 

Like a corporation, it is a separate legal entity.

Unlike a corporation, there is no stock and there are fewer formalities.

One or more owners of an LLC are referred to as members. 

The members usually profit from the business flow according to their ownership stake. Members have the flexibility to form an LLC and can easily add or remove members as the business expands. 

2. Why Form An LLC? 

Forming your business as an LLC offers key benefits that enhance its legal and financial framework. 

The following are key benefits of forming an LLC: 

1. Asset Protection: LLCs offer a safeguard by legally separating personal assets from business liabilities, providing an extra layer of protection. By doing this, personal property such as savings and real estate will be safeguarded against any business debts or legal actions.
2. Tax Benefits: LLC profits are only taxed once as personal income, making taxes simpler and often less burdensome compared to corporate structures. LLCs also have the option to choose S corporation taxation which provides greater flexibility for tax planning.
3. Flexibility In Management: An LLC's structure allows direct member management or the appointment of managers – it gives you the freedom to customize your involvement in your business's operations.

Furthermore, opting for the LLC designation can enhance the credibility and professional image of your business. 

Establishing an LLC is a practical choice for entrepreneurs – an LLC involves few formalities and paperwork compared to corporations. 

3. What Are Essential Documents For LLC? 

Below is a guide on what documents you need to form and maintain an LLC. 

FORMATION DOCUMENTS

Articles of Organization

These papers properly register your firm with the state. The document typically outlines:

• LLC's name & address
• Names of members and managers
• The registered agent's information
• The objective of the business
• Duration of the LLC, if not permanent

Filing this document with the state agency initiates your LLC's legal existence. 

Operating Agreement 

Though not necessary, this document is important for detailing the operational and financial arrangements of LLC members. This includes: 

• Member ownership %
• Voting rights and obligations
• Profit and Loss Distribution
• Procedures to add or remove members
• Dissolution criteria

This document acts as the LLC's governance charter. 

COMPLIANCE DOCUMENTS

Annual Reports 

Most states require an annual report to update or validate the LLC's information on file, which includes: 

• Current business address
• Names of members & managers
• Registered agent information

Filing on time is important for maintaining a good status with the state. 

Tax Documents 

LLC must comply with federal, state, and local tax requirements. Key documents include: 

• EIN (Employer Identification Number) registration
• Federal Income Tax Returns
• State and municipal tax filings -→ where appropriate

Understanding your LLC's tax status (disregarded entity, partnership, or corporation) is critical for compliance. 

FINANCIAL DOCUMENTS

Bank Resolution

Permits selected members to create a bank account in the LLC's name, which is necessary for financial transactions and record keeping. 

Membership Ledger 

A complete record of each member's contributions, distributions, and ownership percentages. 

OPERATIONAL DOCUMENTS

Minutes of Meetings

While not required, recording decisions during meetings is a good idea for legal and operational clarity. 

Contracts & Agreements

If your company enters into different contracts, ranging from vendor agreements to client service contracts, keeping structured records of these agreements is critical for legal compliance and corporate operations. 

INTELLECTUAL PROPERTY DOCUMENTS 

Trademark Registrations 

Protecting your brand's identity via trademark registration is critical. This includes the LLC's name, logo, and any distinctive product names or services. 

Copyrights & Patents

To protect intellectual property rights, LLCs with original works or discoveries must get copyrights and patents. 

By understanding these essential documents, you're not only protecting your business but also positioning it for success. Ensure these documents are accurately maintained, accessible, and updated regularly according to any changes in your LLC's structure or operations. 

4. What do you need to start an LLC with MyCompanyWorks?

To start an LLC with the help of MyCompanyWorks, all you need is...

• A Company Name and an Alternate Choice (must end with “LLC”, “L.L.C.” or “Limited Liability Company”)
• The LLC’s Business Purpose
• Your Contact and Shipping Information
• Your Business Address
• The Registered Agent's Name and Address
• Type of LLC Management: Members or Managers
• Name and Address of Members or Managers

If you have that information, you can simply order LLC Formation Services from MyCompanyWorks starting at $79 + state fees. 

5. How does MyCompanyWorks form your LLC?

Depending on the state, this is accomplished by:

1. Clearing your LLC business name for acceptance by comparing it with existing LLCs on file.
2. Filing Articles of Organization (also known as a “Certificate of Organization”) with the state’s document filing office. This document is notarized with the help of NotaryLive, making the process completely remote, fast, and convenient!
3. Holding an Organizational Meeting (which specifies who becomes a Member or Manager and issues ownership percentage to the “owners”) and adopting the LLC Operating Agreement (the rules your LLC adopts for internal governance including adding/removing members, handling disputes, etc.).
4. Final Formalities: The LLC must then obtain a Federal Employer Identification Number (also known as an FEIN – we can obtain this on your behalf) and then open a bank account so LLC company funds can be managed separately. Finally, your local jurisdiction (city or county) may require your company to obtain a business license which grants the LLC authority to conduct business operations within city or county limits.

To learn more about MyCompanyWorks, click here!

Interested in learning more about NotaryLive and remote online notarization? Click here to check out this article.

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FAQ On LLCs

• Is an LLC good or bad? 
  • Good. An LLC (Limited Liability Company) protects personal assets while also allowing for tax flexibility. It combines the advantages of corporations and single proprietorships.
• Do LLCs need to make money? 
  • No. LLCs are not legally obliged to earn money; but if you claim tax deductions through an LLC, the IRS may conduct an audit to confirm its for-profit status.
• Should I start an LLC for my side hustle? 
  • Yes! Creating an LLC for your side business provides security, legitimacy, and tax advantages. It divides company and personal funds and permits deductions.

Does NotaryLive sound like the right fit for you and your business? 

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**Legal Disclaimer - We are not lawyers or attorneys and do not give any legal advice. Please check with your attorneys, advisors, or document recipients if you have any unanswered questions about your documents.

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