Steps to Form an LLC While Complying with Legal Requirements

limited liability company

To form an LLC, some steps need to be followed. But before that, an individual should have clarity on what exactly is LLC and how can it serve the right purpose. LLC is the short form that is used for the limited liability company. It is one way to create the business structure legally. It blends the corporation’s limited liability with much better flexibility. There will not be much of the formalities offered by the sole proprietorship or partnership in such a case. Any business owner who wishes to restrict the personal liability for the lawsuits and business debts can go with this option.

Steps to start a limited liability company

Select a Name for LLC:

The very first step to forming LLC is to ensure the LLC name complies with the state rules. These rules of course would differ as per the state requirements. Often the states usually need the name of the LLC to end with the designator of the LLC such as a limited company. The states also prefer the name to be different than another business entity or LLC which is already registered with the same state.

Articles of Organization

To further create LLC, the article of an organization should be filed with the state corporate office. It is also called the secretary of the state. In some states such as New Hampshire or New Jersey, the term is often used as the formation certificate while in some states like Pennsylvania it is called an organization certificate. This can be accomplished online in a systematic manner.

Selecting a Registered Agent

It is important to form an LLC with an agent registered. This is a company or an individual who agrees to accept the legal documentation on the behalf of LLC if in case it gets sued. The registered agent should also have a physical address present in the same state where the registration of the LLC is done.

Decision on Member vs. Manager Management

There are so many small LLC that often plan to be managed by some members directly. However, some LLC can also hire more than one person to manage the whole LLC such as the board of directs. The vote of the managers is important for concerns such as buying real estate or taking a loan.

Form an LLC Operating Agreement

Not many of the states need it but it is better to go for the LLC’s operating agreement. This is one internal document that creates the planning on how the LLC shall run. This also includes the way LLC needs to be managed. In case of operating agreement absence, the state has the authority to govern the way LLC operates.


Beyond this LLC also needs to be complex with all the legal requirements and finish the online EIN application. To form an LLC, there are some licenses needed but again, it entirely depends on the business type and its location that may vary.

Petrus Tanase
My name is Petrus Tanase. I am the founder and writer of this website. I really like to write about the latest news and share it with others through my site.

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