When one is starting a business, there are tons of things he has to consider. One of these things is whether to start a corporation, a partnership or a limited liability company. It is just natural to be anxious about these things. A corporation and a partnership are usual types of businesses, so for people who are pondering about putting up an LLC instead, this article will somehow make things quite easier as it will provide the three basic tasks to successfully form a LLC.
1. First and foremost, name the LLC.
One of the most exciting parts in creating a business is thinking of what to name it. And just like any other business ventures, a LLC name must be unique, distinct, and catchy. Once a name is chosen, a quick check with the office of the Secretary of the State has to be done to verify if no other company is registered with the same name. If the name is available, an “Application for Reservation of Limited Liability Company Name” can be filed. This reservation, however, is only good for four months or for 120 days, it must only be filed by mail and must be paid with a corresponding fee of $20.
Also, one must note an important cardinal rule in naming an LLC, and that is to include the words “Limited Liability Company” or the abbreviations “LLC” or “L.L.C” in such business name. This is an obligatory requirement to be able to form a LLC hence, it cannot be dispensed with.
2. Formulate the Articles of Organization.
The bulk of the information lies in the Articles of Organization and so this must be carefully prepared with all honesty and diligence. To successfully form a LLC, the articles of organization must include, of course, the name of the company and its address; the name of its registered agent and his address; and whether the LLC will be ‘manager-managed’ or ‘member-managed.’ Also, the duration of the business venture shall be included, if the intention is not to operate it permanently. Be sure to include only genuine and true facts to avoid accusations of misrepresentations and the like.
The filing of the Articles of Organization should be done by mail. Moreover, the members are to pay a fee of $50 each; the minimum fee for a company being $300 and the maximum, $3,000.
3. Appoint or hire a registered agent.
LLC name availability, a registered agent must be selected as his role is of importance in the business undertaking. Either an individual or a business entity, a registered agent is concerned with the legal cases of the LLC in case a lawsuit arises. Much like a legal counsel, this registered agent shall represent the company. To be qualified for such position, it is important that the agent is either a resident of Tennessee or is a business entity licensed in the state.