Many new entrepreneurs prefer to start their business as a limited liability company (LLC). That is because of the benefits that this hybrid structure offers. Aside from protecting the personal assets of the owners against the debts and obligations of the company, this legal business entity structure also provides flexibility in terms of taxation and management.
What You Will Need To Form A Maine LLC
Each state imposes its own regulations when it comes to businesses. The requirements and processes may vary depending on where you decide to organize your company. You have to make sure that you comply with all of the necessary steps to formalize and legalize your business operations.
In Maine, business owners who want to start an LLC will have to go through the registration process, which involves filing formal paperwork and paying certain fees. The company will also have to comply with various state requirements as long as it exists. Failure to do so may result in penalties and a bad standing status. Having a reliable agent will help make sure that your company remains compliant with the state.
Naming Requirements – Before you form a Maine LLC, you have to familiarize yourself with the naming guidelines of the state. Under state law, you have to include the phrase “Limited Liability Company” or any of its abbreviations like “LLC,” “L.L.C.,” “LC,” or “L.C.” Meanwhile, low-profit LLCs in the state may use “L3C” or “l3c.”
Your company name should also be distinguishable. You cannot use it if another entity is already using it. You will have to check the availability of the name that you want to use. If you hire an agent like DoMyLLC, you can ask us to do the name availability search for you.
If you want, you can also reserve your company name for 120 days. You can do this by filing an Application for Reservation of Name with the Secretary of State. The filing fee for normal processing is $20. The 24-hour service costs an additional $50, while immediate processing requires an additional $100. You should also attach a filer contact cover letter that includes the following information:
- Entity Name
- List Of Filings Enclosed, If Any
- Special Handling Requests, If Applicable
- Total Filing Fee Enclosed
- Applicant’s Name
- Contact Number
- Email Address
- Name And Mailing Address Of The Person To Receive The Attested Copy
Certificate Of Formation – To formalize your company’s registration, you will have to file a Certificate of Formation with the Secretary of State by mail. The filing fee is $175. Your certificate has to include the following pieces of information:
- LLC Name
- Effective Date, Whether Upon Filing Or At A Later Date
- Whether the Company Is A Low-Profit LLC
- Whether the Company Is A Professional LLC
- Name And Address Of Your Registered Agent
- Signature Of An Authorized Individual
Operating Agreement – While the state does not require you to create an operating agreement, having this internal document can help prevent disagreements. You can use it to establish the rights, duties, powers, and liabilities of each LLC member. It can also outline the distribution of profits and losses as well as the various operating procedures and management requirements of the LLC. Read our article on LLC operating agreement to find out more about this step.
Tax And Regulatory Requirements – If your LLC has more than one member, you will have to get an Employer Identification Number (EIN) from the Internal Revenue Service (IRS). If you are the sole owner of the LLC, you may also need to obtain an EIN to hire employees and open a business bank account.
Depending on your business activities and location, you may also need to acquire certain state and local business licenses. Check this with the Department of Economic and Community Development. For local licenses, you will have to check the requirements with the clerk of the town or city where the primary place of business of your LLC is located. You may also need to register with the Revenue Services if you plan on hiring employees or will be selling goods that require you to collect sales taxes.
Annual Report – Maine requires all LLCs that do business in the state to file annual reports every June 1. You can choose to get a preprinted form from the website of the Secretary of State. The filing fee for annual reports is $85.
Choosing Your Registered Agent
Among the information that you have to disclose in the Certificate of Formation is the name and address of your LLC’s registered agent in Maine. The state requires all business entities to appoint a registered agent who agrees to receive all legal correspondence, tax notices, and other important documents on behalf of a company.
So who can you nominate? Generally, you have three options:
- You can be your own registered agent.
- You can choose a family member or friend.
- You can hire a third-party organization.
If you are going to choose an individual, they have to be a resident of Maine and at least 18 years old. Meanwhile, if you hire a commercial registered agent, you have to make sure that they are authorized to transact in Maine.
The registered agent should also be available during business hours and have a street address in the state. The state has to be able to reach your registered agent when necessary. Otherwise, your LLC may end up falling into bad standing.
Another crucial function of the registered agent is to be a point of contact. A process server should be able to contact your registered agent if your LLC faces a lawsuit. If they fail to do so, the court case may proceed without you knowing. That will be disadvantageous for your company. The judgment of the court may be against your company because you were not there to defend your side.
Before making a decision, you will have to weigh the advantages and disadvantages of each option. Which one provides the most benefits to your company? Some entrepreneurs choose to nominate themselves or another individual. While this may help you save a few bucks, it may also expose your company to some unwanted risks.
On the other hand, choosing to hire a third-party organization like DoMyLLC will increase your expenses, but it may turn out to be more beneficial. You can get access to a team of experts that has a better understanding of various filing and compliance needs. In addition, you will be able to manage your time and focus on growing your business. There is also no need for you to change your registered agent even if you move.
If you choose to work with a reliable company like DoMyLLC, your LLC can benefit as early as the business registration process. Our team also offers business filing services. We can assist you with other compliance requirements as well. You can discuss the specific needs and circumstances of your business to get a personalized solution that is right for you.
Final Thoughts On Why You Should Form A Maine LLC
There are various decisions you have to make once you choose to start your own business. Among the first ones is the business entity structure. Your choice will affect the taxation of your company and your personal liability. It will also determine the requirements you have to submit and the processes you have to complete.
If you choose to form a Maine LLC, you have to make sure that you know all the necessary documents and understand the whole process. You can consult a reliable third-party organization like DoMyLLC to make sure that you complete each step.
Another important factor is having the right registered agent for your Maine company. The responsibilities of your registered agent will help with business compliance. If you are looking for a commercial agent, make sure that the one you hire will have the appropriate skills and knowledge.
If you want to learn more about forming an LLC in Maine or need a reliable organization to assist you during the registration process, contact DoMyLLC. Our team can also serve as your registered agent, and we offer other business filing and compliance services.
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