LLC Creation – A Roadmap to the Process

The government in every state requires that your company be registered and formed for you to do any business. Your registered agent is the person or entity that will file and receive paperwork on behalf of the company. This is often a small LLC formation service provider who can act as a liaison between your business need and the government’s requirements.

Filing taxes, registering employees, filing lawsuits: these are not tasks which you can do on your own! All of these processes take time and money away from running your company.

Why should you consider an LLC creation?

There are many benefits of LLC creation.

  1. The main benefit is that you, the sole owner of the company, are only responsible for the financial “health” of the company. Let us explain what we mean by the financial health of a company.
  2. In most states, sole proprietorships and general partnerships are what are called “pass-through tax entities.” This means that business profits and business losses pass right through to your personal income tax return. As a sole proprietor or partner, you report the profit and loss of the business on your personal income tax return.
  3. As an LLC, the profits and losses of your business pass through to the business. The owners are not personally liable for debts that the company incurs.
  4. Although you are not personally liable for debts that your LLC company incurs, if you fail to pay taxes based on that income or, in some cases, property taxes, then your personal assets can be attached.

Types of LLCs:

  • single-member LLCs
  • multi-member LLCs

Single Member LLC:

These are the easiest to form and get approved by your state. You do not need any other partners or members; the sole owner receives all of the profits and pays all of the taxes on those profits. It is a great way to set up a side business, like selling items on eBay or crafts at a fair.

You only have yourself to worry about, and you do not want the headaches that will be involved with hiring employees and full-time bookkeeping.

Multi-Member LLC:

This type of LLC has more than one owner. However, it does not have employees and regular bookkeeping. The owners are responsible for the business’s financial “health.” If one of the members decides to file bankruptcy or stop paying taxes, then you could be held liable for those debts.

If a member wants to buy out his partner, then he will need to pay off his debt before removing himself as a business member. It is essentially a partnership without any partners.

What is the difference between an LLC and an S Corporation?

An S Corporation is one of the most common business structures in the U.S. This entity structure allows a company to be taxed as a separate entity, but it does not require them to pay corporate taxes. Instead, they will be taxed on their profits only.

Additionally, an S corp can also be owned by up to 100 shareholders, which makes it ideal for larger companies and organizations.

What does the word ‘limited’ mean in a limited liability company?

The word ‘limited’ simply means that there is a limited liability shield for the LLC’s owners and members. This means that the owners of an LLC will be protected from any legal action, contractual obligations, or financial liabilities.

In other words, if the LLC becomes bankrupt or ends up getting sued, its creditors will not be able to go after them.

How To Set Up An LLC In 7 Steps

To form your LLC, you should follow the easy steps below.

1. Decide on a Business Name

Before you can begin the LLC formation process, you need to have a name ready to go. You should choose a business name that is unique and catchy. Some people even trademark their business name and pay extra for a service mark on their company’s name.

Others choose to have a generic business name, such as “ABC Investments” or “XYZ Services.” You should also have a DBA (Doing Business As) name.

This is the name that you will use to do business with others and even file your LLC paperwork with the government.

Naming Requirements:

  • You can have up to 100 characters in your name.
  • You cannot use the same name as another business.
  • You cannot use copyrighted symbols and words such as “&” or “@” in your name.

How to register an LLC Business Name?

LLC name registration varies by state, and the form needs to be filled, but it will typically require:

  1. Provide the LLC office address.
  2. List your business name.
  3. List your fiscal agent, who will file documents for you.
  4. Provide a signature by the owner of the LLC.
  5. Provide the name and address of a person to sign as an authorized agent on behalf of the LLC.

What is a Fictitious Business Name?

A Fictitious Business Name (also known as a B.E.N. or an assumed name) is the name that you will use when creating your LLC.

The name you choose for your business varies with each state, but it must be unique because it will serve as the official name for the company if ever anyone wants to see a copy of its articles of organization, licenses, or other records.

Do I have to have a Fictitious Business Name?

No. Many states require that you choose a unique name for your LLC, but some of them do not require it. You will need to check with your state if they do or do not require you to use a B.E.N.

2. Designate a Registered Agent

The second step is to designate a Registered Agent. A Registered Agent is someone who can act as an agent for you in receiving and delivering paperwork. While the government does not require the Registered Agent services, it is highly recommended. They will act as a middle man between your company’s needs and the government’s requirements.

A Registered Agent service can be either an individual or a business. It is recommended that you have two (2) registered agents in your state.

A Registered Agent:

  1. Acts as a liaison between your company and the state government.
  2. Receives legal documents on behalf of your company and files them properly with the government.
  3. Can receive and deliver certified mail to your company.
  4. Prepares tax reports that have to be filed with the state government by law, such as FBAR (Foreign Bank Account Report) or Schedule B (Form 8832).
  5. Keeps business and personal finance books for your company separate.
  6. Records the date of receipt of documents with the government, so you can track important legal paperwork and filing information at any time.
  7. Confirms that all required information is submitted to the government by your company, whether that be for employee taxes or legal filings.

How to choose a Registered Agent?

  • The Registered Agent is generally a third party such as a service provider, company, or bank.
  • The Registered Agent cannot be the same person as an owner or manager of the company.
  • The Registered Agent must be local to the state where the business is formed.
  • The Registered Agent must have an SSN (Social Security Number) issued by the US Government.
  • The Registered Agent should not be related to or have any financial interest in either the company or its owners.

3. Get a Copy of Your State’s LLC Article of Organization Form

LLC formation is a complex process, and your state’s information will be different than our example. You will need to find the Article of Organization for your state. This is typically found on the state’s Secretary of State website.

The process varies, but often you will just complete and submit an online form to register your company. Some states do not require an LLC formation fee; some do.

What is an Employer Identification Number (EIN)?

The EIN is a nine-digit number that identifies your LLC or any business entity for tax purposes. Each business entity has a unique number which is used to identify the company to internal revenue service and when doing other government work with the IRS.

How to get EIN?

A company will need a Tax ID number (EIN) if it will have employees, will be taking out loans, paying taxes, or anything else that requires a positive identification number for the business. Most people get an EIN when they register their company with their state, but it is possible to do so after business formation. The IRS can assign an EIN from their online portal, or you can apply at your local IRS office.

4. Prepare the LLC Article of Organization Form

The Articles of Organization form usually contains:

  • The name of the company and members
  • The Registered Agent’s address as well as SSN.
  • Any other information relating to this LLC form.
  • The signatures of the owners.
  • The date of filing the Articles of Organization.
  • Date, the Articles, were received or accepted by the Secretary of State.

You can file the LLC Articles with your Secretary of State office, but you will also usually need to have these signed and notarized by a lawyer for authenticity in each state. Take into consideration also that you may need to obtain state permits, licenses, and other documentation from your local jurisdiction.

5. File the Articles of Organization

After you have completed the Articles of Organization Form, you need to fill it with your state government. Most states require that the form be filed in person or by mail. You should bring 2 copies of the Articles of Organization form to your business formation agency. You will be required to pay a registration fee. Some states do not require one!

After paying, you will receive certified copies of the Articles of Organization as proof that your LLC has been formed.

6. Create an LLC Operating Agreement

An operating agreement is a document that states how certain members of the LLC will function. This document should include:

  • The name of the LLC, address, and Registered Agent.
  • An outline of each member’s rights and responsibilities.
  • A description of how profits and losses will be distributed among the members.

This document is very important and should be reviewed by both owners before proceeding to create an LLC bank account for the company.

What is an LLC Certificate of Organization?

This is a document that describes your company’s legal status. It is accepted by all banks and financial institutions to be used as valid proof of ownership and business formation.

It can be used to apply for loans and credit. It can be used to open new checking and savings accounts. It is required to create an LLC bank account. Many states require that the document be filed with the Secretary of State’s office in order to obtain a state business license. It is also commonly used when opening up new bank accounts or with payment processors such as PayPal or Stripe.

What does it contain?

  • The name of your company
  • The address of your LLC
  • The Registered Agent’s address and SSN for the LLC
  • A list of members of the LLC.
  • Signatures from all members and the Registered Agent included.

7. Keep Your LLC Active

Many people do not follow the LLC formation process. The reason many people do not follow the process is that it takes time to file the Articles of Organization with your state government and complete the LLC setup procedures.

If you do not have a business yet, then you can delay starting your LLC for 6 months from the date of formation. However, if you are performing services under your LLC name and need to file any tax returns or pay taxes, then you should still follow the steps above.

Separate your business and personal assets

Your personal assets should be separate from the LLC. This ensures that your personal assets will not be taken in the case of a lawsuit or bankruptcy. If you do not properly separate your LLC’s financials from your personal finances, then any money, property, and/or accounts that are part of your business can be seized by the court and turned over to a creditor such as a bank for non-payment of debts.

1. Opening a business bank account

Opening a business bank account is not required, but it will allow your company to more efficiently pay bills and employees. You will need to have a business bank account in the name of your LLC to receive payments.

Your LLC is often required to have a business bank account in order to retain its status as a legal entity. You can open a business bank account via a company’s online banking platform or in person at your local bank.

It is possible to open a business bank account via a personal bank account. You will need to get a letter of authorization from your personal bank stating that the money in the business bank account is clear for use by your LLC.

If you use a personal bank account, you will also need the loan documents or loan papers with your signature confirming that the money in your business account can be used by the company.

2. Getting a credit card

As a business owner, you will need a credit card for your business to keep track of purchases and expenses. You can apply for a business credit card if your LLC has been in existence for longer than 6 months.

Remember, when applying, you are legally representing your LLC. As the company “owner,” you are responsible for all debts and should consider if the purchase is necessary to your company’s function before making an expense.

3. Hiring an accountant

If your LLC is performing services, then you will be required to pay taxes on a quarterly basis. Hiring an accountant could also be beneficial even if you are not required to pay taxes because they can provide expertise on how to keep track of expenses and track your business earnings.

Hiring an accountant could also be beneficial to help you with filing your LLC papers. Another benefit of hiring an accountant is that most offer a free consultation on how to keep your business taxes at the lowest possible tax rate.

Obtain necessary licenses and permits

Licenses and permits are required by the state for most of these steps. Some are state requirements, and some are federal requirements. Most states do not charge licensing fees to create your LLC but may require that you pay additional tax on your income.

Your state government will process a license or permit for each of the following:

  • Business registration (additional taxes may apply).
  • Business license (additional taxes may apply).
  • Sale of goods in the course of business (additional taxes may apply).
  • Sale of goods or services at a convention, trade show, or another meeting (additional taxes may apply).

You must also obtain federal licenses when applicable:

  • Fictitious name registration from the county clerk.
  • Business license and/or tax I.D if your company will have employees and be considered an employer.
  • Federal employer identification number (SSN) for your company and each employee.
  • Sole proprietorship tax ID if you are filing your company income as a sole proprietorship.
  • The federal tax ID number for your LLC if will be treated as a corporation on your taxes.

Get Insurance

You must purchase insurance for several purposes:

  1. Property insurance to protect your company’s assets.
  2. Workers compensation insurance to cover the employees of your company.
  3. General liability insurance if you are not a member of a professional association (doctors, lawyers, dentists, etc.).
  4. Fire and theft insurance (most cities require this type of policy).
  5. Employer’s Liability Insurance.
  6. Professional Liability Insurance.

You should also obtain some type of business owner policy from a specialized insurance company (such as an umbrella policy) to cover your assets and cash on hand.

Laws and Regulations: What are you required to do?

In addition to the above, many states may have their own specific requirements for LLC start-ups, i.e.

  • Meetings (if over 50% of the members are non-resident).
  • State income taxes on members.
  • Annual report to state officials.

Check with your state authorities for more information.

What is the cost of LLC formation?

If you have ever formed an LLC for a non-profit or other company, there are filing fees that are applied to the formation of your company. These fees can range from $50-$500, depending on the state. There are also many more forms to complete when forming an LLC.

The cost of creating and maintaining an LLC may be prohibitive to some small business owners who want to take their business seriously but do not have enough money to see it through all the way.

How long will it take before my LLC is approved?

It all depends on the state’s time frame, but most of them can complete the process within 30 days of receiving your paperwork via email or fax.

What is the average LLC tax rate?

The average LLC tax rate in the U.S. is around 15%, but it can be significantly lower for some states. It all depends on whether your business is considered a sole proprietorship, partnership, or corporation. The LLC’s tax rate will depend on your business structure.

Can I form an LLC for free?

Yes. There are some online company creators who offer free LLC formation services for new members. This is a great way to start your adventure with an LLC because you won’t have to worry about paying any fees.

Is an LLC Right For My Business?

If you are a consultant, freelancer, or work independently from home, an LLC is probably your best bet. It will give you the most anonymity and keep your personal assets safe. The money that is made through the company is then taxed as income on your personal return.

If you do not want to have any personal liability for the debts of a business, this may be for you because all of your income will be “passed through” to you personally and taxed on your 1040 as self-employment income.

What are the benefits of a limited liability company (LLC)?

  1. No double taxation.
  2. A person can be the sole member.
  3. No Tax Return Filing is required for LLC.
  4. An LLC can choose to be taxed as a corporation or partnership.

What are the disadvantages of a limited liability company (LLC)?

  • Members in LLC are not totally free from personal liability.
  • Managing an LLC is more complicated than a partnership or sole proprietorship.
  • You can only have up to 100 members in an LLC.
  • LLC’s can be taxed as corporations if it has at least 2 members, annual gross receipts of $80,000, and conducts business for profit (LLC tax return).

LLC Taxes Requirements

In most states, to qualify for an LLC, you must have 100 or more members and maintain minimum annual gross receipts of $5000. The tax filing requirements are similar to those for corporations.

LLC Tax Form 1065

The IRS is required to make rules for operating an LLC (Internal Revenue Code). You will need to file a Form 1065, Annual Return for Mandatory Taxes on Certain Business Income of a Corporation or an LLC.

You will not have to file it unless you have to pay taxes, and the amount is at least $50. Some states also require additional forms for income tax filing.

LLC Tax Form 1120

A U.S. LLC must file a form 1120 with its IRS income tax return, which shows its information about the company, such as total receipts and profits for the previous year.

If an LLC chooses to be taxed as a corporation, it can file its state taxes in the same way a sole proprietorship does; however, this is impractical because of the annual minimum fee for filing as a corporation.

Election To Be Taxed As A Corporation

If an LLC has at least 2 members and gross income that exceeds $80,000, it must file Form 8832 to make elections for federal tax purposes. If you want your LLC to be taxed as a corporation, you will need to fill out Form 8832.

Election To Be Taxed As A Partnership

If an LLC has no more than 100 members, it must file a Form 8832 to make an election for federal tax purposes. If you want your LLC to be taxed as a partnership, fill out Form 8832.

Record-Keeping Requirements for an LLC

LLCs are not subject to many of the record-keeping requirements that apply to corporations and partnerships. However, because they do not receive cash (profits), they will have higher accounting costs than corporations and partnerships.

LLC Employers: Payroll Taxes

Income earned through an LLC will be treated as being earned by the members, who must each pay self-employment tax. It is advantageous to have one member of the LLC act as the “wage earner” for the company and receive a reasonable salary equal to or greater than his share of profits. This way, profits can be taxed at a lower rate, and any losses can be deducted against other income.

Can I Form a Corporation to Avoid Paying State Taxes?

Yes, you can form a corporation if you do not want to pay taxes. The corporation will be a separate legal entity, so it will not be included in your personal or business tax returns.

Again, this is because corporations are separate from the owner; therefore, each member of the board is considered an owner, and they are responsible for paying all corporation fees. There are some benefits and disadvantages that you should consider before taking this step.

Hiring employees

LLCs can, unlike sole proprietorships and partnerships, hire employees. As an employer, an LLC must withhold taxes from its employees’ paychecks and pay employer payroll taxes. The LLC members, not the company itself, are considered the employers’ employers.

While the LLC itself does not pay self-employment taxes on its profits, it is responsible for paying any employment taxes on its earnings. This makes it difficult for single-member LLCs to act as sole proprietorships without hired help or bank lending.

How many employees can I have with an LLC?

The number of employees you can have with your LLC will depend on your business structure, but it is safe to say that you will be limited to having no more than 100 employees. This is also the number of people you can hire if you want to start a staffing agency or work as a consultant for other private businesses.

Promote your LLC

When you are trying to promote an LLC, the first thing people think about is who owns it? How do they decide if it is a good investment? The answer to these questions will depend on how much hiring your company does.

If you have employees, many people see this as a good sign that the company is growing strong and give it more thought before investing in it. If your LLC is a small business with just one employee, investors may not know enough about your company to make an investment.

Methods of promotion:

  1. Have your LLC meet in person with the people who want to invest. They can ask you any questions they have and see for themselves what kind of company you run and how much money you make.
  2. You can also tape a video of your LLC discussing why they would like to invest in it. Then, send the video to your potential investors via email or mail it out on DVD.
  3. If you do not have a physical place to meet, hire a professional to meet with them. Tell them your story in person or on tape.
  4. If your LLC is an online business, this can be a great way to advertise it as well. Email your potential investors and let them know about the services you offer.
  5. Finally, while you might not have much money for advertising services, you can get your name out there on free online classifieds and watch your clients come into contact with your company through the internet.

Website creation

Creating a website for an LLC business is identical to creating one for a sole proprietorship or corporation. However, keep in mind that your sole member LLC will not want to list the names of the members of the company; this could be a security risk for you.

Your web domain can be similar to this article but never portray any personal information, such as the name of the members of your LLC.

Press Release

If you are promoting your sole proprietorship or corporation and have no employees, it is a good idea to send out a press release instead of an email. Press releases are sent to the media for publishing, and if they choose to do so, they will put it in their publication.

This way, your name is seen by thousands of readers in newspapers and online publications. Setting up an LLC requires less government paperwork than a corporation or partnership; however, you need to pay more fees as an LLC owner.

Recommendation For Best Company Formation Services

If you have decided that an LLC is for you, the best way to form your company is using an LLC filing service.

A company formation service like this will not only make sure that your articles of organization are filed correctly, but they can help you with another business formation service such as EIN (Employer Identification Number) registration, as well as help you set up a Business Email Account.

Here is the list of the five best LLC formation services online.

1. ZenBusiness offers one simple and cost-effective method, being one of the best LLC services online. Their efficient and easy-to-use system provides you with the necessary information for creating your business.

ZenBusiness LLC services are offered at a competitive price, which is inclusive of all the legal filing charges from their experienced team of experts.

ZenBusiness Pros

  • Online service.
  • No hidden fees.
  • Saves time and money.
  • Excellent customer service support.
  • Great for small businesses and freelancers looking to start a business from home.
  • EIN online application is made as easy as possible.
  • Simple and straightforward steps are provided for completing the online application process.
  • The team at ZenBusiness is always available to answer any questions you may have regarding LLC services offered by them.

ZenBusiness Cons

  • No free consultation.
  • Adding multiple members is limited to three people.
  • Not ideal for businesses with more than three members.
  • The free EIN registration is not provided as a once-per-year legal services subscription.
  • Customer feedback about delays and bugs during the application process.

ZenBusiness Pricing and Features

ZenBusiness services provide you with the ability to choose between three packages which include:

I. Basic LLC filing service (includes filing up to 25 Articles of Organization and 1 member).

The price for a Basic LLC filing service is $149.95, and it includes:

  • EIN registration.
  • LLC Certificate of Organization.
  • Operating Agreement and Bylaws preparation.
  • Corporate records and office setup (DBA).
  • Business plan writing.
  • Monthly tax-saving tips and guidance via email.
  • Legal and business advice.
  • Assistance with marketing and sales.

II. Enhanced LLC filing service (includes filing up to 50 Articles of Organization and 2 members).

The price for Enhanced LLC filing service is $249.95, and it includes:

  • All the benefits of the Basic LLC package
  • Assistance with forming an LLC for a non-profit organization.
  • Assistance with incorporating in the state of Delaware.
  • LLC tax reclassification service.
  • Business plan re-writing service.
  • Assistance with creating LLC marketing strategy.

III. Complete LLC Service (includes filing up to 100 Articles of Organization and 3 members).

The price for Complete LLC Service is $999.95, and it includes:

  • All the benefits of Basic and Enhanced LLC services
  • Assistance with incorporating in the states of Illinois, New York, Ohio, Pennsylvania, and Washington D.C.
  • Assistance with obtaining a better tax status for your company.

Additional fees apply if you choose to add additional members later.

2. Incfile has a long history of providing legal services to the public. They specialize in all types of business formation services and offer expert and efficient service to their clients.

Incfile LLC filing service is one of the most popular online LLC services out there, which makes it easy for you to form your company with them. Proficient legal experts and consultants will guide you through every step of the formation process.

Incfile Pros

  • Quick and efficient service.
  • Efficient online system.
  • Includes all requirements and documents.
  • Tax savings tips included.
  • Free consultation.
  • Tailored to your specific needs.
  • Continuity of services and customer support.
  • Additional registrations and filing for fees.
  • Professional advisors are available to answer your questions or queries.

Incfile Cons

  • Additional fees apply if you choose to add additional members later.
  • LLC formation is not included.
  • Incorporation services in states other than Delaware are not available.
  • Limited to two members.
  • Some users report delays and bugs during the application process.

Incfile Pricing and Features’s services include:

  • $99.00 Complete LLC Service (includes filing up to 100 Articles of Organization and 3 members).
  • $249.00 Enhanced LLC Service (includes filing up to 200 Articles of Organization and 5 members).
  • $1,599.00 Complete LLP Service (includes filing up to 1,000 Articles of Organization and 10 or more members).
  • $3,999.00 Comprehensive LLC Service (incorporation in West Virginia).

Additional fees apply if you choose to add additional members later.

3. Inc Authority

Inc Authority is one of the best LLC service providers that can help you with all of your company formation needs.

Inc Authority LLC is a professionally established organization that has been providing legal services to the public for over 20 years. Therefore, they offer expert and proficient legal services at reasonable rates which are affordable for every client.

Inc Authority Pros

  • Professional service.
  • Efficient online system.
  • Helpful website articles and FAQs.
  • Tailored to your specific needs.
  • Continuity of services and support.
  • Additional registrations and filing for fees.
  • Professional advisors are available to answer your questions or queries.
  • Additional benefits for purchasing additional services such as establishing an LLC within a state or receiving title insurance.

Inc Authority Cons

  • Additional fees apply if you choose to add additional members later.
  • LLC formation is not included.
  • Limited to two members.
  • The free consultation is available only to new users during the initial registration period.
  • Incorporation in states other than Delaware is not available.
  • Limited payment options.

Inc Authority Pricing and Features

When you choose to file your paperwork through Inc Authority, you can avail of their low rates and cost-effective service packages. Their services include:

  • $99.00 Family LLC Filing Service (includes filing up to 2 Members).
  • $199.00 Team LLC Filing Service (includes filing up to 3 Members).
  • $599.00 Business LLC Filing Service (includes filing up to 10 Members).
  • $999.00 Corporate LLC Filing Service (incorporation in West Virginia).

Additional fees apply if you choose to add additional members later.

4. Rocket Lawyer

Rocket Lawyer is not an LLC service provider, but it offers free articles of organization writing services.

This online LLC formation service is meant to be used by new companies and individuals that don’t have the time or money to pay for professional LLC services. These articles of organization can be sent out to a lawyer for review before you file them.

Rocket Lawyer Pros

  • Free articles of organization writing service.
  • Easy to use the website.
  • Write an article on organization within minutes.
  • No hidden fees.
  • Help articles and FAQs are available.
  • Tailored to your specific needs.
  • Continuity of services and support.
  • The free consultation is available only to new users during the initial registration period.
  • Additional registrations and filing for fees.
  • Professional advisors are available to answer your questions or queries.

Rocket Lawyer Cons

  • Few hidden fees.
  • Limited to one article of organization.
  • Subject to availability of free articles of organization writing service.
  • Published articles can be extremely critical and can cause delays in the process.

Rocket Lawyer Pricing and Features

Rocket Lawyer offers a hassle-free and cost-effective service that you can use right from your home. They have detailed services which include:

  • $39.00 for a single-member LLC filing (includes state filing).
  • $69.00 for an LLC with two members (includes state filing).
  • $99.00 for an LLC with three to nine members (includes state filing).
  • $129.00 for an LLC with ten or more members (includes state filing).

Additional fees apply if you choose to add additional members later.

5. LegalZoom

LegalZoom is one of the leading legal service providers on the market. They offer legal services at rates that are affordable and within your budget. Their services are designed for individuals and companies that do not have the time or money to pay for a legal help lawyer or public accountant.

You can opt for their “Legal Size Up” service, which will help you find a lawyer who can review your articles of the organization before you file them.

LegalZoom Pros

  • Cost-effective service.
  • Free initial consultation to review your paperwork.
  • Cheaper service if you opt for the “Legal Size Up” service.
  • Helpful website articles and FAQs.
  • Professional advisors are available to answer your questions or queries.
  • Limited hours of service.
  • Additional benefits for purchasing additional services such as establishing an LLC within a state or receiving title insurance.
  • Tailored to your specific needs.
  • Continuity of services and support (although not always reliable).

LegalZoom Cons

  • Few hidden fees.
  • Additional fees apply if you choose to add additional members later.
  • LLC formation is not included.
  • Limited to three members.
  • The free consultation is available only to new users during the initial registration period.
  • Additional registrations and filing for fees.
  • Incorporation in states other than Delaware is not available.
  • Limited payment options.

LegalZoom Pricing and Features

LegalZoom provides an affordable and affordability service to their clients. Their business formation packages include:

  • $349.00 Complete Package (includes incorporation in West Virginia).
  • $149.00 Legal Size Up, which is a service that helps you find a lawyer or P.A to review your paperwork for you (This service is only necessary if you do not have a lawyer helping you).
  • $99.00 Basic Package (includes incorporation in West Virginia).

Additional fees apply if you choose to add additional members later.

Beware of Scam Services

The Internet is full of scam service providers. It is important for you to be wary of the services that you choose since some of them are fake, and they will not even file your paperwork.

Since it can be really hard to find a perfect service provider, we recommend you to opt for a service that offers a money-back guarantee in case they can’t help you form your LLC.

How is it possible to recognize scam services?

  1. They will offer you a free registered agent service.
  2. They will not have any professional LLC service providers working for them.
  3. Their online system is not secure.
  4. You won’t be able to find them through a web search engine.

How Much Would an Attorney Charge Start an LLC?

Attorney fees to form an LLC are usually a bit higher compared to other business structures. It all depends on the lawyer’s specialty and the complexity of your business.

However, it can be a lot cheaper if you opt for forming your LLC through a legal service provider. This will save you both time and money since you won’t be required to visit an attorney on your own. Plus, it will give you more time to work with your lawyer so that they can create the perfect document for you.

What is the best way to find an attorney for my LLC?

There are many ways in which you can find the perfect lawyer for your LLC. The first and the most common way is to search for attorneys in your area through a web search engine. This can be a bit tricky since it is hard to find a good lawyer without doing lots of research.

Another option that you have is to ask other business owners how much cost their attorney charged them when they formed their LLC. Of course, this may not be the most accurate option since many business owners have a special relationship with their attorneys; they know that they will work with them again and that the fees will be worth it.

What Is a “State Fee” and How Much Does It Cost?

The state fees are pretty expensive, and they vary from one state to another. On average, most companies pay $125 to $200 for this fee. However, the price can be a lot more if your LLC needs special licensure.

You will also need to check with the state government on whether or not you need to pay this fee and how much it costs.

What Does My State Charge for an LLC Annual Report Filing Fee?

LLC annual report filing fees are almost the same between different states. You can expect to pay $50 once a year if you are doing your LLC filing in-person or online. This fee is a mandatory process for all business entities that operate within the U.S., and it is used to help these states keep track of the different businesses that exist within their boundaries.

To sum it all up, you will need to keep a number of things in mind before deciding on which state is the best for your business. You need to take into consideration the location, distance between your business and its clients, taxes, fees, and other mandatory payments that you may need to make.

As you can see, creating an LLC is not as difficult as many people make it seem. With some research and patience, you will be able to form a company that works better for your business model.

Will I have to pay any fees if I withdraw my LLC?

Yes, you will have to pay a fee if you want to withdraw your LLC. This is the reason why it is recommended that you do your LLC formation as soon as possible.

It can sometimes be a bit more expensive and time-consuming if you wait longer, so try to avoid prolonging this process.

When Can I Start a Professional Corporation?

You will need to make this decision before the preparation and filing of your business plan. You need to know whether you are planning on having a professional corporation or not.

If you are going to start a corporation for your business, then you will have to form it within two months after the formation of your LLC.

What if I do not have a business plan?

You do not need to have a business plan before you create an LLC for your organization. However, it is highly recommended that you make one as soon as possible because this document will determine how your business operates and how it can get the financing that it might need in the future. It is also very important to check with your state if you can file an LLC as a sole proprietor or if you need to make it through a partnership.

Is it possible to convert my LLC into a corporation?

Yes, it is possible to convert your LLC into a corporation. However, this process may not be as simple as you think. You will need to contact the state that your LLC is registered in and notify them that you would like to convert your business structure.

This can take a lot of time, so it is recommended that you start the conversion process when your LLC has just been formed. It is easier to convert the LLC into a corporation when it is just a few months old.

The Costs Involved in Converting an LLC to a Corporation

It costs less if you convert your LLC into a corporation at the early stages. If you wait until your formation company has been established for some time, then you will have to pay a lot more to convert it.

The average price of converting an LLC into a corporation is about $800. Some other LLCs may charge as high as $20,000.


A lot of people do not know how to correctly and safely create an LLC. This is one of the most common reasons why they cannot get their LLC approved even if they already have paperwork and set up everything on their end.

We hope that we were able to help you understand this process and that you are now ready for the next steps to get your LLC approved.

Leave a Reply

Your email address will not be published. Required fields are marked *