Steps To Forming an LLC in South Carolina
Before you start a business, it’s essential to understand what type of business structure you’re going to form. Are you planning on setting up an LLC? The choice could have some major impacts on your daily operations, taxes, and personal assets. If so, we’re here to help by laying out the steps to forming an LLC in South Carolina.
What Are The Benefits?
An LLC (short for Limited Liability Company) combines the best aspects of both a corporation and a partnership. Like a partnership, it offers tax advantages to owners, by allowing them to split their income with their partners, who report the profits from the business on their personal income tax returns. Also like a partnership, it offers protection against personal liability for the company’s debts and judgments.
Step 1: It’s In The Name
One of the first steps in starting your own business is coming up with a name that will help you stand out and attract customers and stand out to your specific brand. When registering a name for your LLC, you must pick something that is unique and unused by other businesses. It is important to perform a name search to ensure that you are not taking another name already in South Carolina’s Business Entities Database. Also remember you will need to include a variation of LLC at the end of your name, whether it be LC, LLC, L.L.C, or any other variation.
Step 2: Finding A Registered Agent
A registered agent receives important legal documents and forwards them to you. This allows you to stay on top of your business and accept legal papers on behalf of a company in the case of a lawsuit. We at Grand Strand Law Group are ready to be there for you and comply to all requirements of South Carolina law including the essentials:
- A physical street address in South Carolina
- A South Carolina resident or a business authorized to do business in this state.
Step 3: Articles of Organization
To form an LLC in South Carolina, you’ll need to file Articles of Organization with the South Carolina. Your Article of Organization should include your LLC’s name and address, your agent’s name and address, the name and address of every LLC organizer, and whether or not your LLC is member or manager-managed. The filing fee for Articles of Organization is $125 for online filings and $110 for filings by mail or in person.
Step 4: Drafting Your Agreement
Your LLC operating agreement is a key part of business formation. This document is not filed with the state, but it does establish important rules that dictate how your LLC operates. It establishes how profits and losses are to be distributed among members, who has voting authority within the LLC, what happens if members leave or new members join.
Step 5: Apply For An EIN
An EIN (Employer Identification Number) or Tax ID number is a number that helps identify your business similar to a social security number. These numbers are supplied by the IRS. You can apply for your EIN online or by mail easily. It is also free to get one, and you will most likely need one to get your business open, hire employees, and create a bank account.
Step 6: Opening Your Business Bank Account
When you’re starting a business, you’ll need to open a bank account so you can keep your personal and business funds separate. You also need to create a business credit card and debit card as part of these preparations. Planning ahead will save you time and headaches later on, when you’re preparing to do your taxes and handling the accounting.
Steps To Forming an LLC in South Carolina With Grand Strand Law Group
At Grand Strand Law Group, we understand that creating a new business is a fun and exciting time for anyone! We are here to help you every step of the legal way. Give us a call at 843.492.5422 and learn more about LLC Formations.