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LLC 101 - Installment Two:  Making It Official

 

By Richard Barra, Esq.

  So you met with your tax advisors and they suggested that you form a limited liability company for your new business venture. What do you do now?

1. Name Selection and Availability. You will first need to decide on a name for your business and then determine whether that name remains available for use in Florida. You should avoid generic names. Although a generic name may be available, you want to distinguish your business from others, both from marketing and unfair trade practice standpoints. Please note that acceptance of a designated name by the Florida Department of State does not guarantee that you have the undisputed right to use that name. If another business with a similar name engages in a similar business, you could still be liable for damages as a result of an unfair trade practice claim if members of the public could reasonably be confused by your use of a similar name. For example, if you form an LLC named McDougal's and sell fast-food hamburgers, you will surely be getting a letter from representatives of McDonald's, even if that name is available for use in Florida (shades of "Coming to America").


Once you select a name, you will need to confirm availability. This can be done on the Internet through a search at sunbiz.com.

2. Articles of Organization. Once you select an available name, you will need to file articles of organization with the Florida Department of State. This can be done electronically at sunbiz.com or you can mail physical copies of the articles to the Florida Department of State. Florida charges a filing fee of $125.

The articles of organization must include the following: (a) the name of the LLC which must include the words "limited liability company" or "limited company" or the abbreviations "L.L.C." "LLC" ("Company" and "limited" may be abbreviated as "Co" and "ltd" respectively); (b) the mailing and street addresses for the company; and (c) the name and street address for the initial registered agent and office for the company (which must be a business address in Florida). The articles of organization may also include any other matters that the members wish to add.

The articles of organization must be executed by at least one member or by an authorized representative of a member. The registered agent also must execute.

3. Federal Employer Identification Number. Once you confirm filing of the articles of organization with the Florida Department of State, you will need to obtain a Federal Employer Identification Number for the LLC. Please note that certain single member limited liability companies do not need to obtain separate FEINs, and can use the Social Security Number of the single member. Check with your tax advisors.

The FEIN may be obtained by physically filing an SS-4 with the Internal Revenue Service or obtaining the number online at http://www.irs.gov/index.html. If you file online, you will immediately be issued an FEIN for the company.

You are almost there!

Rick welcomes your questions about this article at rkbarra@scott-harris.com

Next installment: LLC 101: The Partnership Agreement