Young entrepreneurs may not have much experience in setting up a business. In fact, most people start their first company between the ages of 25 and 45. While this is an exciting time, it can also be incredibly overwhelming, especially if the new owner has never gone through the process before.
Fortunately, an LLC registered agent company can help guide owners through the process. An LLC registered agent is someone who acts as a third-party liaison for all things related to a business. LLC registered agents will receive all notices and correspondence from the Secretary of State’s office in the state in which a business files. They will also receive other official mail, such as notifications and tax forms.
Although business owners can select anyone to be their registered agent, they would be wise to choose a trusted company that offers document filing services in addition to registered agent services. Registered agent companies have years of experience working with LLCs, and they should be a trusted resource as new owners move through the process of creating their first business. Below are ten things to ask an LLC registered agent company before entering into a contract solidifying a company's standing as operational.
1. Why Do I Need To Register In A Given State?
When operating as an LLC, owners need to work under state law in the state in which they're conducting business. This means that as a company grows, owners will likely have to register their LLC with more than one state. Note that when doing so, a registered agent will handle all of a business’ needs for that particular state. This prevents owners from being burdened with paperwork, allowing them to focus on other aspects of their business. A registered agent company can help owners gain a better understanding of why they may need to file in that particular state and the benefits of doing so.
2. How Much Does It Cost To Register?
As entrepreneurs begin to start their business, the costs could add up quickly. Many people do not realize the fees associated with filing as an LLC. One of the questions to ask a registered agent company is how much it will cost to file in a given state, and how much their services cost. Fortunately, there are some registered agent companies available to offer services at a very affordable rate.
3. How Should I Come Up With A Name For My Company?
Naming an LLC is a little bit trickier than one may think. Most states require that a business' name be distinguishable from other LLCs in the state. Additionally, states often limit the terms that a company can use in its name. For example, many states don't allow LLCs to use words such as "insurance company" or "bank" in their name. A registered agent company will have a better understanding of state regulations and can help owners come up with a name under which they could potentially register their business. They may also have access to a database of other companies.
4. How Do I Prepare The Operating Agreement?
When owners register as an LLC, they will need to draft an operating agreement. The operating agreement addresses critical components of the business, such as who makes capital contributions, the penalties for not doing so, how to divide profits and losses amongst business owners, and other similar financial information. This information is crucial to a business' operating procedures. The state in which a company is filing may also require a copy of this document. A registered agent company and document filing firm could help new owners prepare this information.
5. How Do I Receive An Employer Identification Number?
An employer identification number — or EIN — is essential for many things, primarily filing taxes with the federal government. Even though this is federal information, a registered agent company can still help owners secure an employer identification number.
6. What Business Licenses Do I Need?
Depending on what type of business owners are operating, they will need to secure licenses at the local, state, and potentially federal levels. A registered agent company can help determine how a new business can be classified and what type of business licenses they need to operate legally. If it turns out that a owner needs permits to manage the company, a registered agent can help file the paperwork to do so.
7. How Will We Communicate?
It's essential that owners clarify with their registered agent how they will inform each other of relevant information. A registered agent receives notifications about annual reports, taxes, and other critical business matters. If owners are not in the state in which they filed the initial paperwork to register their business, it could be tough to get these documents.
LLC owners can establish with their registered agent how they wish to be informed of upcoming deadlines or notices. Some companies prefer that any official correspondence is mailed to them, while others prefer their registered agents to call them if something arises. Regardless of their preference, it's crucial that owners establish precedence with their registered agent. An option that many owners choose is having their registered agent both email them and upload documents to a secure account as well.
8. Who Can File Required Filings?
Another important thing to establish is who will file routine paperwork, such as an annual report when there are no changes in corporate structure to report from the past year. Some business owners prefer that their registered agent handle simple business matters, while others prefer to be made aware of everything filed on their behalf. It’s essential that owners establish their preferences with their registered agent to avoid confusion in the future.
9. How Will We Pay Filing Fees?
Owners should also discuss with their registered agent how they will pay filing fees and taxes. Most government agencies allow businesses to pay by credit card, but some still enable them to pay by check. It’s essential that when founding a company, new owners establish a bank account that is strictly for business matters. LLC members should not use this bank account for personal use. Owners should determine how they will transfer funds from this account to their registered agent company for filing fees.
10. Do I Need An LLC Membership Ledger?
Some states require their businesses to maintain a membership ledger, which details the name and addresses of LLC members. It also keeps a transaction history of units, demonstrating how many units each member has. A registered agent company can provide more information about whether a company needs to maintain a ledger.
Business Filing Section