A Limited Liability Company (LLC) is the best option for startups because it contains all the protections of a corporation without the complex maintenance. You can form an LLC as one person or if you have one partner—it does not have to be a large company (although it works for big businesses as well). Here are the steps you need to take for Florida LLC formation in Miami, FL:
- Choose a name: Your business requires a unique name that must contain the initials “LLC” or state “Limited Liability Company.” Most company names have LLC following their primary name (for example, My New Company, LLC). Check the Division of Corporations business name database to be sure no one else uses the preferred name of your company. Once you determine that, you can get started on the paperwork.
- Find a registered agent: The registered agent is required of all Florida companies and provides a contact for service of process. This individual agrees to accept all legal documents on your behalf. You have the option of designating your attorney as the registered agent, hiring a registered agent or assigning the duty to one of your managers or partners. The only requirement is that the individual or business entity must be licensed to perform business in Florida.
- File Articles of Organization: This document states vital facts such as name, address, signature of the registered agent, names of managers and the effective date of the LLC. Once drafted, you can file the document online or send a hard copy in the mail.
- Draft an Operating Agreement: The Operating Agreement is not required in Florida, but attorneys recommend it for several reasons. It contains provisions about how profits are divided and the duties of members and managers. When you have this agreement, it makes it easier to resolve disputes involving compensation and division of labor. Operating Agreements also contain provisions on how to dissolve the LLC if the company becomes insolvent or managers decide to go their separate ways. This is yet another way the agreement can prevent future litigation and ease problem-solving and future transitions.
- Talk to a CPA: LLCs have specific tax requirements. An attorney can guide you through some of those requirements, but it is best to hire a CPA who handles your tax filing every year and can offer advice regarding your tax status. You will need to register with the Department of Revenue, and if the LLC has more than one manager, you need an Employer Identification Number—even if you have not hired employees yet. A CPA can help you keep all of this in order and ensure you have the right licenses.
- File annual reports: To maintain your LLC in Florida, you must file timely annual reports. This is a quick form that asks about changes in managers or registered agents. It is filed online and you must pay a yearly fee to maintain your registration. Do not be late, or the fee nearly triples and you risk your LLC status.
Ruben J. Padron, PA, practices corporate law and offers guidance in Florida LLC formation in Miami, FL. Contact our office today to schedule a consultation.