You have a business name, location, and registered agent. You’ve filed your Formation Files, or Articles of Organization, with your state, and now you might be wondering about and waiting for approval. How do you know if your LLC has been accepted and is there anything else you can do in the meantime while you wait for approval? This article will go over these pertinent questions about your LLC application and what you can do while you wait.
When you first start the process of filling out your Files of Formation to make your LLC official you need to check with the specific state you operate in.
How To Know If Your LLC Has Been Approved
Your LLC is only official when your Articles of Organization are approved of and filed.
In order to ensure that your Files of Formation (Articles of Organization) are done in the right way to avoid it being rejected, the following factors can potentially deny approval:
- If you don’t pay the necessary fees.
- Any errors or in the forms you filled out.
- If the forms are not filled out properly or illegible.
- If the business name is not available.
You can also opt for additional assistance by hiring a formation service that will organize all the necessary documents for filing, this can also save time and money.
What To Do After You Have Applied For Your LLC
After you have applied for your LLC there are other steps to take to complete the process of setting up your LLC, these can be done once your LLC has been approved, or while you wait for approval.
The Operating Agreement is another important document, or legal contract, that stipulates the ownership of the LLC and what the specific roles and responsibilities will be of those involved, the financial sums that each owner contributes, as well as any assets included.
The Operating Agreement can include the following sections, however depending on the type of business owners might add other sections:
- Management and Voting
- Capital Contributions
- Membership Changes
EIN (Employer Identification Number)
An EIN is an identification number for your business and can apply for one from the IRS (Internal Revenue Service) website for free, or via fax or mail.
An EIN will be needed for your LLC for the following reasons:
- If there will be employees hired.
- If there is more than one member in the LLC (multi-member LLC).
- If the LLC will open a business bank account.
The EIN will help with tax reporting and maintaining good business banking records, which can be beneficial in case you ever need to take out a loan.
Business Bank Account
You will need to set up a business bank account, this will be beneficial as it will separate your personal banking accounts from your business accounts and protect your personal assets.
Licenses and Permits
Depending on the type of business you open there could be additional need to apply for specific licenses or permits. Below are some examples (not all) of professions that will require licenses or permits, but it is important to always make sure what the requirements are from the state the business operates in.
- Fish and Wildlife
- Alcoholic Beverages
- Mining and drilling
A General Liability Insurance is recommended for any LLC just starting out because this will offer the necessary protection for your business. A General Liability Insurance policy can safeguard business assets, as well as provide coverage towards any legal defenses like lawsuits.
Registering your LLC for state tax will also be an important step for your business, the following taxes can be considered:
- Sales and Use Tax: if your business sells physical products.
- Unemployment Insurance Tax: if your business has hired employees.
TRUiC’s website offers extensive information about LLC formation and the application process, read here to know more.