
LTD vs LLC: What Is the Difference?
Published on February 16, 2022
If you’re starting a company, you may have heard of various business structures you might choose, such as a limited liability company (LLC). You may also have…
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If you filed articles of organization with your state to form a limited liability company (LLC), you may be wondering if your LLC has been approved. The approval time varies by state but is usually no more than a few weeks. Some states approve the LLC immediately after you submit your articles of organization and pay your fee.
You will be notified by your state upon approval, usually by mail. If you have yet to receive a notification you can do a business name search on your state’s website to see if your name appears. If it does, your LLC is approved and active. If not, it has either not been approved yet, or it was rejected, in which case you should receive a notification that includes the reason for rejection.
If your LLC has been approved, congratulations! However, you have a few more things to do to get your business up and running. The first thing you should do is print a copy of your articles of organization because you may need it.
An operating agreement is not usually required but is highly recommended. The operating agreement should clearly define the following:
It’s a good idea to have an attorney’s help when creating your operating agreement to ensure you cover all bases and avoid future issues.
It’s important to make sure you’re in compliance with all laws at the local, state, and federal levels. It’s likely, depending on your location and type of business, that you’ll need business licenses and permits. Do some research to determine which licenses you need.
EIN stands for Employer Identification Number and is like a social security number for your business, allowing the IRS to identify your business easily. It is also known as a Federal Tax Identification Number (FTIN), or sometimes for corporations a Tax Identification Number (TIN). An EIN is required if your LLC has more than one member, if you plan to hire employees, or if you choose to have your LLC taxed as a corporation. The application is free and can be found on the IRS website. The application is form SS-4, and it can be mailed to the IRS or submitted electronically, and once your information on the application has been validated, the EIN is assigned immediately.
Before you start making money, you’ll need a place to keep it, and that requires opening a bank account. Keeping your business finances separate from your personal account makes it easy to file taxes and track your company’s income. Opening a business bank account is quite simple, and similar to opening a personal one. Most major banks offer accounts tailored for businesses — just inquire at your preferred bank to learn about their rates and features. You will need your EIN and your articles of organization.
Business insurance is an area that often gets overlooked yet it can be vital to your success as an entrepreneur. Insurance protects you from unexpected events that can have a devastating impact on your business. Here are some types of insurance to consider:
Your state may require you to file annual reports for your LLC, which may involve a fee. Check your state for requirements and put your annual report dates on your calendar.
Now you’re ready to start selling and making money. Be sure to keep up to date on annual reports and business license renewals or you could face severe penalties.
To check your LLC status, just do a business name search on your state’s website. Chances are it will be approved pretty quickly, if it hasn’t already been. If it’s rejected, you’ll receive a notification. Usually, the reason is a simple clerical error on your articles of organization or an issue with your business name. Both can usually be easily corrected.
Published on February 16, 2022
If you’re starting a company, you may have heard of various business structures you might choose, such as a limited liability company (LLC). You may also have…
Read Now
Published on February 16, 2022
If you’ve recently formed a limited liability company (LLC), you may have some tax questions. One of the most important is about when LLC taxes are due….
Read Now