Forming a limited liability company (LLC) in Vermont allows you to enjoy asset protection. So, your personal assets will not be affected even if your company incurs debts and other obligations. Additionally, you can also have pass-through taxation treatment. That is why many startups prefer this business entity structure. It is important to know the right LLC paperwork.
Organizing your Business in Vermont With The Right LLC Paperwork
Each state has their own business formation process. It is important to know the specific steps for your state. But, generally, it includes the submission of documents to formalize the registration of your company. You will also have to go through multiple steps.
There may also be additional requirements and obligations that you will have to comply with during the existence of your LLC. Having a reliable agent to support you can help in handling the various processes and ensure compliance.
Here are the things you have to be aware of and prepare for the LLC paperwork:
- Naming Requirements – The state has naming regulations that companies have to follow. If you choose to form an LLC, you will have to include the phrase Limited Liability Company or one of its abbreviations. You also cannot use any term that could confuse your company with a government agency. Additionally, you also need to ensure the distinguishability of your LLC. You cannot use a name if another business entity has already taken it. An agent like DoMyLLC can make sure that your company name follows the guidelines and conduct a name availability search.
- Articles of Organization – Among the first LLC paperwork you have to file is the Articles of Organization. Submit it to the Secretary of State and pay the $125 filing fee. To complete the form, you will have to disclose some pieces of information:
- LLC Name
- End Month of the Fiscal Year
- Description of the Business
- Initial Principal Office Address
- Name and Address of your Registered Agent
- Name, Signature, and Address of the Organizer
- Operating Agreement – While the state does not require the creation of an operating agreement, having one can help outline the duties, powers, and rights of the LLC members. It also defines the operating procedures of the company. It also reduces the risk of conflict among business owners.
- Employer Identification Number (EIN) – You may obtain an EIN from the Internal Revenue Service (IRS). It serves as the social security number of your LLC. It will also be useful in opening a business bank account, taxation, and hiring employees. To get one, submit a completed SS-4 form. The name on your EIN should be the same as your registered name. You can apply for an EIN online. Obtaining this number is free of charge.
- Business Licenses and Permits – Depending on the industry you are in, your business activities, and the location of your primary place of business, you may have to obtain certain business licenses. There is no statewide business license. However, cities and counties may have their own requirements. Check with local agencies to find out what type of business license or permit you have to get.
- Annual Report – LLCs have ongoing reporting obligations. You have to file an Annual Report. This LLC paperwork will make sure that the state is updated on your company’s ownership and contact information. The filing fee for this report is $25. You have to submit it within the three-month window after your fiscal year ends. Failure to submit this report can lead to the loss of your good standing. Having a bad standing status can lead to administrative dissolution. An agent can remind you of the deadlines.
Your LLC’s Registered Agent
Another requirement that you need to remember is the nomination of a registered agent. They will be the point of contact of your LLC with the state. They will accept all legal correspondence and business-related mail on behalf of your company.
Here are the requirements:
- If you choose an individual, s/he should:
- be a resident of the state.
- be at least 18 years old.
- have a physical street address in the state
- always be available during regular business hours
- If you choose a company, they should:
- have a physical street address in the state
- be authorized to do business in the state
- be in good standing with the Secretary of State
Making the Right Choice
You have to choose whether your company will have an individual or commercial agent. For an individual, you can appoint a friend, family member, or member of the LLC.
So, what is the best option? Well, you will have to weigh the pros and cons before making a decision. Choose the one that is the most beneficial for your company. You should also make sure that you are comfortable working with them.
Some business owners appoint an LLC member, themselves, family members, or friends because it helps them save money. However, doing this can expose your company to some unwanted risks.
On the other hand, a commercial registered agent can lead to expenses. However, if you find a reliable third-party organization like DoMyLLC, you can have peace of mind.
As stated earlier, your registered agent has to be available during normal business hours. The state has to be able to contact them. If your agent does not receive documents and forward them to you on time, you may miss deadlines. In such cases, you may lose your good standing status or even have administrative dissolution.
If a process server cannot reach your agent to inform them about a lawsuit against your company, you may not know that a court case has already proceeded. The worst-case scenario is if a court reaches a decision that is against your LLC since you were not there to defend your company.
Having a third-party organization as your agent may be more advantageous. It will also lessen your responsibilities and give you the freedom to manage your schedule. There is also no need to worry about appointing a new registered agent in case you move.
How DoMyLLC can Help
If you think that a commercial registered agent is right for you, you will have to find the right organization for your LLC. Check this article to learn more about the traits you have to look for in a registered agent.
You have to hire one that can do more than accepting business mail. A third-party organization like DoMyLLC can offer various services, including business compliance solutions. Our team of experts can help in the preparation, handling, and submission of LLC paperwork.
This way, your company can benefit even during the early stages since we also offer business filing services. We can also come up with a personalized solution to ensure that our services fit the needs and circumstances of your LLC.
What You Should Do
To form a business entity in Vermont, you will have to figure out which structure is right for you. Your decision will have an impact on the taxation of your company, as well as its obligations with the state. Additionally, your decision will determine the paperwork you have to file and the process you need to complete.
An LLC will provide you with protection, allow flexibility in administrations, and give you tax benefits. Knowing the appropriate documents to submit can help prevent any issues. A third-party organization like DoMyLLC can help streamline the whole ordeal to lessen the hassle and stress for you.
Additionally, it is also important for you to find a registered agent. Since they will serve as the general point of contact of the state, you will have to make sure that they are qualified to handle your company’s legal documents.
If you are looking for a commercial registered agent, make sure you appoint one that can help you with state compliance throughout the existence of your company. They should be able to provide support not only as a contact person.
If you want to know more about what we have to offer or are ready to form you’re an LLC, contact our team of experts at DoMyLLC. We also offer live support, so you can talk to us if you have any concerns or queries.
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