Tuesday, March 27, 2018

Forming an LLC

By Madame Margherite
**I am not a lawyer or accountant, nor do I have any formal education in business aside from what I have taught myself through reading laws, forms, trials and occasionally asking an attorney or accountant some questions. None of the information here is from unverified or unofficial sources such as word of mouth. The information here is meant to be a guide to figuring out how to form an LLC and contains only a limited amount of information pertaining to incorporation & franchise law. Consider this information to be starting points for your own research and decision making.**
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A business is a contactual agreement between a government, in this case the American government, and a person or entity which gives the person or entity permission to profit on that soil. 
The government also requires you meet certain conditions in order to earn money here, which is different. 
Even when reselling things a person is required to file for permission to accept and pay sales tax.
There are many types of businesses but the type I’m highlighting is Limited Liability Companies or LLC. 
Choosing a Name & Location
The first step to filing any business is to go to the .gov site for the state you want to start your business in. Some states have more strict requirements than others, and some states charge an annual franchise tax, for example California.
Also, you’ll have to choose the category or professional field you intend to do business in and be aware that some services or products require you obtain licenses to conduct such business prior to filing for an LLC. For example, things like Chiropractic services require the person providing the service to have a license.
LLC's require an agent who acts on behalf of the company to reside or have a residence in the state the LLC was formed and does business in. In short, the purpose of having an agent registered is so the government can contact them in regards to important matters, for example audits or lawsuits. So it’s important that there is a physical address where a government official can find an agent representing said LLC who is reasonably available during regular business hours.
The agent does not have to be the owner of the company. Many people chose to hire professional agents to act as their company’s registered agent, but it is not necessary, just as it’s not necessary to have a lawyer establish you business. 
The second step you’ll take is choosing a unique name for your business. That means the name of your business can’t be the same as any other business in the same area. You can look up name availability by searching the state’s .gov website for it’s business look up, for New York that section of the DOS.ny.gov site is called Corporations and State Database. The name of your company will end in the type of business it is, for an LLC it will end in ,LLC. 
Finding the proper Forms and Information you’ll need
When you’ve decided a name and which state is best for you form your LLC in, search the .gov websites for “LLC forms” it’s official title is Form LLC-1 and in my case I would find it on:
So I would go to sos.ca.gov it stands for Secretary of State, California, Government. 
In New York the address for the form you need to file an LLC can be found at: https://www.dos.ny.gov/forms/corporations/1336-f.pdf
The DOS standing for Department of State. You can always find the forms you need to file along with all tax and filing requirements by starting from USA.gov and navigating to the state site you wish to incorporate in. 
The forms will have all the information you need however you may have to look up anything you don’t understand. This includes taxes & fees required upon submission, instructions, information fields and what is required of you after filing, usually within that order in the document.
What you are filing for is called Articles of Incorporation so if you don’t find what you’re looking for by searching "LLC formation” search “Articles of Incorporation” 
All forms and contracts always have to be filled out in black or blue ink. Red ink voids a contract, and green ink can be argued to have been a demonstration or example. 
Fees, Taxes and Post Filing Requirements & Procedures
Documentation & Filing fees are usually around $125 depending on the state you’re filing in however some states have annual tax requirements. California requires LLCs to pay an annual franchise tax of $800 while New York does not. 
Some states, such as California, require LLCs to file what’s called a Statement of Information within 90 days after filing Articles of Incorporation/Organization, and again every 2 years. For California the form LLCs are required to submit to the Secretary of State is called Form LLC-12
A statement of information contains details about the company’s recent activity and is made public. This is required especially a requirement for stock selling companies such as C & S Corps, but are also required of LLCs in some states as well.
Once you’ve filed your Articles of Incorporation, you are required to announce to the public that you are incorporated and submit a Certificate of Publication to the Department or Secretary of State, usually within 120 days after the effectiveness of the Articles of Incorporation, or in other words, the day your Articles of Corporation got it’s government seal, it’s official first day as a business. 
You do this by publishing a copy of the articles of organization or a notice related to the formation of the LLC in two newspapers. The newspapers must be designated by the county clerk of the county in which the office of the LLC is located, as stated in the articles of organization. After publication, the printer or publisher of each newspaper will provide you with an affidavit of publication. A Certificate of Publication, with the affidavits of publication of the newspapers attached, must be submitted along with the accompanying fee, usually around $50.
Certificate of Publication forms are found on .gov sites like any other form. New York LLCs would find it here: https://www.dos.ny.gov/forms/corporations/1708-f.pdf 
Applying for an (EIN) Employer Identification Number or Tax ID
This is really the final step you need to take in forming any business before you can actually operate as a business but it’s by far the easiest. You’ll use this number to pay taxes, hire employees and qualify for tax breaks such as the waving of sales tax when purchasing supplies wholesale. All you have to do to get an EIN is go to IRS.gov and fill out the EIN application form. The IRS makes it very easy to find information on how to pay taxes.
There are many other things to learn if you are interested in operating an LLC, contract law, franchise law, employment law, insurance requirements and paying taxes but everything you need to know about operating any business is available for free at any law library and online. Everything I learned and shared in this document I learned from the websites I provided links to. Thank you for reading, I hope this answers some questions.

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