| Forming an LLC, or limited liability company, makes | | | | organization." This simple document can be prepared |
| good sense for many businesses. | | | | easily, often by filling in a form from the state |
| An LLC is a legal entity that can be created in all 50 | | | | corporation division. Typical forms ask for the business |
| states and the District of Columbia. This structure | | | | name, address, and owners' names (owners may also |
| resembles both a corporation and a partnership. The | | | | be called "members"). All of the members, or owners, |
| owners of a limited liability company aren't personally | | | | may sign the articles of organization, or they can |
| liable for any debts the business incurs, just like a | | | | designate one person to complete them. Often the |
| corporation. At the same time, it has flexibility in its | | | | members are required to name a "registered agent" |
| operations and a "pass-through" tax option like a sole | | | | who is authorized to receive legal papers on behalf of |
| proprietorship. | | | | the limited liability company in any future lawsuits. |
| Forming an LLC is relatively simple in most states. | | | | You must pay a filing fee, which can range from $100 |
| However, if your state has high fees or high state | | | | to $800 depending on the state. In addition, it's wise to |
| income taxes, and you don't plan to do business in | | | | create an operating agreement, which sets out the |
| your state of residence, you may want to consider | | | | rights and responsibilities of the members. |
| forming your company in a more business-friendly | | | | Finally, you may be required to publish a legal notice |
| state such as Delaware or Nevada. | | | | regarding formation of a limited liability company. In all |
| The first step you need to take is to choose an | | | | cases, the business must have the proper local, county |
| available name that meets your state's requirements. | | | | and state licenses and permits required for your type |
| The name must end with the right designation, such as | | | | of service or industry. |
| LLC or "Limited Liability Company." In most cases, | | | | With these simple steps, and a minimum of investment, |
| LLC's are prohibited from using words such as "bank," | | | | it's easy to see why forming an LLC is becoming the |
| "insurance," "corporation" and others. | | | | most popular way to start a business. |
| Next, you must file a form called "articles of | | | | |