An LLC is a Limited Liability Company that provides protection of liability wherein it passes through the features of taxation of both partnership and sole proprietorship firms. It is usually the small business owners that prefer an LLC as they experience great flexibility in their management.
An LLC is characterized with features of a specified time span of existence, with no form of double taxation and where the owner can have the liberty of managing the business.
The incorporation of the LLC is done through the state authorities and follows the same steps involved in incorporating a corporation. However, it proves to be easier to incorporate an LLC than a corporation as there is no need of getting consent from the shareholders, there are no shares to be issued and there is no need for a board of directors. However, after the incorporation, the name of the business should end with LLC.
When incorporating the LLC, the duration of its existence has to be mentioned as LLC by itself is a limited corporation. With no shareholders involved here, the member owners of the corporation have their own operating agreement. And once it is decided upon, the LLC is incorporated through the state authorities.
It is necessary that the LLC follow both the state laws and its regulations. The tax that an LLC incurs is passed over to its members. If the LLC intends to employ people, it is necessary that it gets a Federal Employer Identification Number. This is availed once the Form SS-4 form, from the IRS is filled. Not all businesses need to have a federal license; however, all businesses need to get a sales tax permit.
It is possible to incorporate an LLC either by yourself, with the help of a lawyer or an intermediary agency. There are many intermediary agencies found around you and the internet. Choose the most famous and trustworthy agency to incorporate your LLC. However, just because the LLC permits income to flow through the owner of the business, the owner cannot use the money of the business for personal expenses. If this is found out by the state, the state holds the owner liable.
It is possible to incorporate an LLC through the internet. There are many service providers that provide incorporation services on the internet that does the whole incorporation service for you. You will have to pay some state filing fees that differ from state to state that can be paid through credit cards. Prior to online incorporation, you have to decide on the states to be incorporated; and if the chosen name is not available for the incorporation, a form will have to be filled again. The time needed for incorporating an LLC differs from state to state.