Does your Florida business need liability protection? Then you should be ready to create your business in Florida as a Limited Liability Company. An LLC is the best way to protect your personal property and give your business a legal structure.
Florida is an excellent place to do business, mainly because of its simple tax laws. Are you thinking about how to start an LLC in Florida? Don’t panic! In this guideline, you will learn about the process of starting an LLC in Florida.
Creating an LLC can provide you with the legal protection and flexibility you need to succeed, whether you’re starting a startup, a small business, or a consulting firm. So why wait? Let’s dive into the details and get your Florida LLC started today.
What Is an LLC?
LLC is short for Limited Liability Company. It’s a business setup that can be used for various purposes. It is a simple legal entity that protects its owners or members from some of the risks of getting sued.
This means that the owners of the business are not responsible for the business’s debts and liabilities. Instead, the LLC is seen as a separate legal entity that can own property, sign contracts, and run a business.
LLCs offer the same benefits as corporations. It does not require as much paperwork as corporations do. This is one reason why small businesses and entrepreneurs like LLCs so much. LLCs can have as many members as they want, and the people who own them can run the business themselves or hire someone else to do it.
Why Do You Need to Form a Florida LLC?
A Florida LLC is a legal business entity set up according to Florida law. It is a business structure that combines the flexibility and tax benefits of a partnership with the limited liability protection of a corporation.
A limited liability company (LLC) in Florida protects its owners or members in the same way that other LLCs do. This means that the business’s debts and legal liabilities cannot affect the owner’s personal assets. One of the best things about an LLC application is that it keeps its owners or members from getting in trouble. This indicates that business debts and legal obligations cannot be attached to the owner’s personal property.
Therefore, the owner’s personal assets, such as their home or personal bank accounts, cannot be used to pay the business’s debts in the event of a lawsuit or financial difficulties. Small business owners and entrepreneurs in Florida who form an LLC enjoy a variety of advantages, including limited liability protection, tax flexibility, management flexibility, and credibility.
Types of Florida LLC
There are different kinds of LLCs that can be set up. The secretary of state’s LLC law says that each has its own standards and rules. Here are some of Florida’s most common types of LLCs:
- Single-Member LLC: In Florida, the Single-Member LLC is the most common type of LLC. The most common type of LLC in Florida is one with only one member.
- Multi-Member LLC: refers to more than one member. Every member is considered an owner. Multi-member LLCs are usually made up of business partners or family members.
- Series LLC: With a series LLC, you can create different “series,” or divisions, within the same company. Each series can have different members, assets, and responsibilities.
- Professional LLC: A professional, like a doctor, lawyer, or accountant, makes this type of LLC. It is also known as a PLLC.
How to Start an LLC in Florida
Now that you have identified an LLC as the best fit for your business, you want to figure out the best way. Let’s discuss the LLC application in Florida. Here are the step-by-step guidelines for starting an LLC in Florida:
- Select Your Florida LLC Name
It is the first step in your Florida LLC registration. You must choose a name that is different and simple from others. Ensure that the name you select complies with Florida’s naming regulations.
Things to follow when choosing a name for your Florida LLC
- You must include “Limited Liability Company” or an abbreviation such as LLC or L.L.C. in your business name.
- Your LLC’s name can not use words like FBI, Treasury, State Department, etc. so that people do not think it’s a government organization.
- If you want to use words, like bank, attorney, or university, you should send them more documents and need a licensed person like a doctor or lawyer.
It is important to note that your LLC must have a unique name. To identify whether your LLC name already lists businesses in Florida
Most importantly, your name must be unique. In other words, it must differ from already listed businesses in Florida. You can use the state register to search for a Florida business name to see if the name you want to use has already been taken.
- Choose a Registered Agent
Select a registered agent for your LLC, if you want to do business legally in Florida. it is an important part of your LLC. If you have no idea what registered agents are, now is the time to define it briefly.
A business chooses a registered agent to get official legal documents like lawsuit papers, summonses, and other legal notices. Your registered agent will receive any kind of legal mail sent to your LLC and then forward it to you. As a part of the process, your Florida LLC’s registered agent can be a person or any company. It will give your business a physical address in Florida. It will also be able to provide services during regular business hours.
- Submit Articles of Organization
The most important step for your LLC application in Florida is filing your company’s articles of organization. The articles of organization identify your LLC as an official business in the eyes of the state. You can apply online or by mail. Ensure that you include the following details when submitting your articles of organization:
- LLC Name.
- Primary Business Address.
- Registered Agent Name And Address.
- Purpose of LLC.
- Name and Address of the Manager.
- Effective Date.
- Signature.
You should be aware that once you register, the address of your LLC will become a public record. After submitting your articles of organization, the state will notify you that your LLC registration documents have been filed and approved.
- Create Your Operating Agreement
An LLC operating agreement is not necessary, but it is a good idea to have one. Basically, an operating agreement is a legal document that explains who owns an LLC and how it works.
If your business makes an agreement, it will help you in a number of ways, including protecting your personal assets, preventing future disagreements, getting money for your business, and, most importantly, making sure that all business owners are on the same page.
Some common things you should put in your Florida LLC operating agreement are:
- Income and debts.
- Accounts details.
- Management system.
- New Member persuasion.
- Membership transfers.
- Get Your EIN
After your articles of organization are approved, you should definitely apply for an EIN (Employer Identification Number) number. It is also called a Federal Tax Identification Number. If you are still wondering what exactly an EIN is, Let’s clear it up briefly
An EIN is a nine-digit number that is given by the IRS. It is used to figure out what kind of business it is and keep track of the tax reporting for that business. An EIN is considered a Social Security Number for your business.
You’ll also need your EIN to conduct the following business activities:
- Opening a Business bank account
- Hire employees
- Tax Filing
- File Your LLC Annual Report
To stay active, businesses must file an annual report in Florida with the Florida Department of State. The Florida Annual Report is a form that you have to submit every year for your LLC. It will show the state that you are legally permitted to do business. You know, if you do not file your annual report on time, you are definitely required to pay a late fee or penalty.
But the problem is! when you make this sort of mistake repeatedly, the Florida Department of State may shut down or dissolve your LLC. Every year you have to submit your report between January 1 and May 1. The last day to file an annual report is May 1. The first annual report for your Florida LLC is due a year after it was formed.
- Your Business Licenses and Permits
You probably already know that Florida lacks a business license covering the whole state. However, depending on your business location and type, your LLC may require additional licenses to operate legally.
The Florida Department of Business and Professional Regulation (DBPR) keeps an eye on a lot of businesses in the state. Check their website to find out if you need a license for your LLC.
- Florida LLC Bank Account
After the Florida Division of Corporations approves your Florida LLC registration and gives you an EIN number, the next step is to open a separate bank account for your LLC. A separate bank account provides liability protection; it ensures that only your LLC’s assets will be used to pay off any debt or lawsuit. Your personal assets are not included.
Advantages and Disadvantages of Florida LLC
Now, you already know how to start an LLC in Florida. Before making a decision, you should also know the pros and cons of Florida LLCs. According to Newton’s third law, for every action, there is an equal and opposite reaction. There are both pros and cons to forming an LLC in Florida. But, believe it or not, you will enjoy more advantages than disadvantages while forming an LLC.
Advantage of Florida LLC
- Business owners or LLC members are not personally liable for business debts and lawsuits.
- Easy and fast filing, and management.
- The filing fee is low.
- Members do not have to fill out more papers than corporations.
- LLC members can save a large amount of money due to they do not need to pay state income tax in Florida.
- At the federal level, members of an LLC can choose how to tax their business. C companies are taxed twice, but LLCs don’t have to pay taxes twice.
Disadvantage of Florida
- One of the main disadvantages in Florida is LLC members must pay high self-employment taxes on their income.
- Florida’s LLCs demand an annual fee to maintain their status.
- Forming an LLC in Florida initially can have a higher cost compared to other business structures.
What Can Business Globalizer Do For You?
As a business owner, you must remember that it is a mandatory duty for you to file an annual report every year for your LLC in Florida. In this case, you may face a major problem if you do not update your LLC’s annual report regularly. On the other hand, without an EIN number, you can not apply for LLC registration. Getting an EIN is also the toughest task for new entrepreneurs or US non-residents. That is why, Business Globalizer can support you starting from company formation to business licenses, Tax ID numbers such as EIN Number, ITIN Number, US\UK Tax filing, etc.
Even if you are worried about dissolving your LLC, Business Globalizer can assist you with the responsibility so that you can again activate your business status. You know, Business Globalizer is a trustworthy service provider. They basically focused on helping non-residents and foreign entrepreneurs achieve their goals.
FAQs
Q1: How much does it cost to start an LLC?
Answer: The cost of a Florida LLC depends on your business requirements. Basically, to start an LLC, you have to pay two types of fees: initial fees and ongoing fees.
Q2: How long does it take to get an LLC approved?
Answer: It depends on how you file your articles of organization. You definitely know that there are several ways to submit LLC applications, like online, by mail, and over the phone. LLC’s application online is the fastest way. It will take only 5 business days. Others will take more time.
Bottom Line
Finally, you can understand how to start an LLC in Florida step by step. Starting a Florida LLC involves several important steps such as submitting articles of organization, selecting a name, etc. Although it seems easy to apply for an LLC registration, you may face a few difficulties. That is why it is better to consult with a business agency before submitting your application. Overall, Florida LLC can protect your business in several ways, and as an owner, you can also protect your personal assets from any kind of business debt or lawsuits.