To establish a Limited Liability Company (LLC), you must:

Choose a Business Name:

• Firstly, select a name that is distinguishable from other LLCs in your state. You can check name availability on your state’s website.

Appoint a Registered Agent:

• Secondly, designate a registered agent who receives legal documents on behalf of your LLC. You can be your own registered agent or hire a service.

File Articles of Organization:

• Next, submit Articles of Organization to your state’s Secretary of State office with the required filing fee to establish your LLC legally.

Create an Operating Agreement:

• Additionally, outline the ownership, structure, and rules of your LLC in an Operating Agreement. While not legally required in all states, it is highly advisable.

Obtain Business Licenses and Permits:

• Ensure compliance by obtaining necessary business licenses and permits. Requirements vary by industry and location, so check with your city clerk’s office for specifics.

Set Up a Bank Account:

• Keep your business and personal funds separate by setting up a bank account in your LLC’s name.

Maintain Your LLC:

• Lastly, fulfill ongoing requirements such as paying annual fees, filing renewal documents, and keeping records of major business decisions. These requirements vary by state.

Beneficial Ownership Information (BOI) Reporting Requirements:

What is the meaning of beneficial ownership?

• • The CTA requires the reporting of beneficial ownership information, referring to identifying information about individuals who directly or indirectly own or control a company.

Is an LLC required to file a BOI report?

• • Yes. An LLC, defined as a reporting company by the CTA, must file a BOI report unless it qualifies for an exemption.

Can an LLC be exempt from filing a BOI report?

• • Yes, there are 23 exemptions available. However, most LLCs will not qualify for these exemptions, as they mainly apply to entities already subject to government regulation and reporting.

What information is required in the BOI report for an LLC?

• • The report must include the LLC’s legal name, any trade or DBA names, principal place of business address, jurisdiction of formation, and taxpayer identification number. Additionally, it must provide identifying information about each beneficial owner, including legal name, birthdate, home address, and an identifying number from a driver’s license, passport, or state ID.

When can an LLC file its initial BOI report?

• • LLCs created before January 1, 2024, can file their initial report beginning on January 1, 2024, with a deadline of January 1, 2025. LLCs created on or after January 1, 2024, must file within 90 calendar days of receiving notice of their creation.

How and where does an LLC file its initial BOI report?

• • The report is filed electronically with the Financial Crimes Enforcement Network (FinCEN), available on FinCEN’s website. There is no fee for filing the report.

What if an LLC’s beneficial owners change or reported information changes?

• • An updated report must be filed with FinCEN within 30 calendar days of the change. Information about company applicants does not have to be updated.

What if an LLC qualifies for an exemption after filing its BOI report?

• • An updated BOI report can be filed with FinCEN indicating the company’s exemption status.

Can individuals provide personal information directly to FinCEN?

• • Yes, individuals can apply to FinCEN for a FinCEN Identifier, which the LLC can report instead of personal information.

How can beneficial owners and company applicants obtain a FinCEN Identifier?

• • Applications for a FinCEN Identifier can be submitted electronically via the filing system on FinCEN’s website.

Will the public have access to reported beneficial ownership information?

• • No, FinCEN is authorized to disclose beneficial ownership information only to certain groups for specific authorized purposes.

What are the penalties for non-compliance with BOI reporting?

• • Violators are subject to civil penalties of up to $591 for each day of violation, as well as criminal fines and imprisonment.

By understanding both the standard LLC formation steps and the additional BOI reporting requirements, LLC owners and managers can ensure compliance and avoid penalties associated with non-compliance.

Conclusion

In conclusion, forming an LLC involves crucial steps like choosing a unique name and filing necessary paperwork. With the recent addition of Beneficial Ownership Reporting (BOI), it’s essential for LLCs to disclose information about significant stakeholders. Understanding and complying with both traditional LLC formation and BOI reporting requirements is crucial for maintaining legal standing and avoiding penalties. By staying informed and proactive, LLCs can navigate regulatory obligations effectively and set the stage for long-term success.

.

Need help forming your LLC? Contact us today! Book online here or call our office number at 760-754-9059.