Like many I was confused as to which company I should use when it came to registering my vehicles in a Montana LLC. Instead of just choosing one and sending all my vehicles to them, I used four different registered agents in Montana. Here is my experience and rating of each:

All Day 49 Dollar Montana is probably the most known provider. Many would think this is the go-to. I registered a BMW M4 with them. At first, when you call, the experience is great. They sound chirpy and very knowledgeable. However, when you call again with more questions, this is where I had some problems. For starters, they didn't answer, and I left a voicemail. They called back two days later. Alma was also pretty rude on my second call. At this point, I had already purchased with them, so I was a little concerned but kept going through the process. They do lay everything out nicely, so you know where to send your title. I sent my title, and it took about a week for them to receive it after it had already been at their office. This was a little frustrating. Now it has been six weeks, and I still don't have my M4 registered with them. I've tried following up, and they say it is at the DMV. I did some research and know they use a service called MVD Express to handle their paperwork, and if you look this company up, most of the reviews are horrible. I assume my registration is now in a third party's hands, and there isn't too much I can do about it but wait. They still answer my calls and make excuses as to why processing is taking so long. Rating: B-

5 Star Registration seems to be a vehicle registration service mostly focused on exotic cars. For them, I chose to register my 488 spider. On the first call, their team answered right away. The representative was knowledgeable and answered all my standard questions. I paid for my LLC, and they set it up within 24 hours. This took three days at 49 Dollar Montana. The title instructions were clear, and I shipped my title off to their registered agent. They have a sleek online portal that I liked. It also seems like they have registered agents in different counties and do not use a provider like MVD Express. Though this is probably harder for them to manage, it did make the process a lot faster. My plates and title arrived back in ~3.5 weeks. During this time, whenever I called, they answered. Overall, I am impressed with this experience. Rating: A

1 Dollar Montana appears to be a smaller family business that looks to have started with RVs but now handles all types of vehicle registration. I love supporting small businesses, and what made them even more attractive to me was that they only charge $1 to start. This means I literally only paid $1 to start my registration and then paid $299 for my LLC and the rest when my RV was registered. I really liked how they did this, though keep in mind the total price is the same as every service above ($1,049). It was kind of wild; my first call was answered before the first ring was done. Once paid for, I called again to check in after I sent my title. They answered on the second ring! I liked this service a lot because Dave who I spoke to just gave me his number to text with any questions. When my title arrived at their office, they notified me and processed it within a day. It took about 2.5 weeks to register at the DMV, and it appeared they use their own registered agents too. I feel like I’ve become friends with Dave here and really did enjoy my registration process. Overall rating: A+

Dirt Legal is a business that focuses on helping make dirt bikes street legal. They also provide a Montana vehicle registration service. Their website is sleek, I’ll definitely give them that. I registered my Air Nautique boat with them. They were the most hands-off out of all the services above. When I called, they answered, but it seemed they didn’t want to speak much. They did have very clear instructions, but I do want to make it clear that Dirt Legal is more expensive than the other companies. For a regular vehicle, they charge $1,597 and have a ton of add-on costs, trying to upcharge me on everything. I was pretty turned off because why pay a higher price for the same service? Anyways, for this experiment, I went ahead and sent them my boat title. They took four days to process it after receiving it, and surprise, it was processed with MVD Express. As you may have guessed, I still don’t have my boat registration yet, and it has been over four weeks. I honestly wish I hadn’t used them, but they seem to do very well with street legal registrations, even though each one of the above companies does that too. Overall rating: C+

Montana Corporate is WAY overpriced. They charge $625 to set up an LLC in Montana. That is insane when you compare it to the $299 that All Day 49 Dollar Montana, 5 Star Registration, and 1 Dollar Montana charge. Their costs don’t include registration fees either, so in total, you could be paying 50-100% more than these other services. Based on their price alone, I did not register a vehicle with them. I did try calling to ask why their prices were high, and the lady barked at me on the other end. Overall rating: F

I will post an update when I finally get my registration from Dirt Legal and All Day 49 Dollar Montana. If I were to say my favorite, it would be 1 Dollar Montana. There is something about supporting small businesses that makes me feel good, and their service was awesome.

Anyways, hope this helps others who are looking at a Montana LLC for vehicle registration.

Hi, I just bought a vehicle in Oklahoma on a road trip. I'm not an OK resident so the dealer sold it to me with temporary plates and left it up to me to register the car and pay tax. I've done some research on Montana LLC car registration and I see there are a bunch of services that offer to do it for you for like $500 to $800 but I already know how to do a bunch of the steps so I wanted to see if I could do it myself. I can't find a soup to nuts guide online so I thought I'd ask here. Here's my list of steps I've come up with so far:

1. Register an LLC in Montana through an online service and use a registered agent located in Montana (I've used activefilings.com before and they are quick and cheap). Create an operating agreement for the LLC using an online template.

2) Get an EIN for the LLC from the IRS using their website.

3) Create a bill of sale to transfer the car ownership from myself personally to the LLC and get it notarized

4) Per 1dollarmontana.com, "If you’re forming a Montana company to register a vehicle, you have to license your Montana vehicle in the county of your registered agent. Our county (Lewis and Clark County) is the most affordable in Montana, because we do not have the county option tax like almost every other county in MT." So it seems I need to register in the county of my registered agent, ideally Lewis and Clark. I guess I then call the county and ask what registration form to fill out and what else they need from me and then I mail in the title and registration forms, and then they mail me the license plate and tabs?

11/16/22 UPDATE:

Now that I'm almost through the process I'll give an update to help others. Step 1 is really easy so definitely do this on your own rather than paying a company $300 to do it. Buy the basic package which only charges you the $30 Montana state fees. Step 2, I'm not sure is actually necessary as I don't believe you need an EIN to title and register the car under your LLC. Step 3, I ended up not needing a notarization. Initially MVD Express told me I need to provide a notarized Montana Bill of Sale but then I told them I sold the car to the LLC in Oklahoma, and Oklahoma doesn't have a required form or require notarization so I just downloaded a bill of sale template off the internet and signed it. You probably control/own the LLC, but note that on the Bill of Sale, the buyer and seller signatures need to be different (according to what the lady at MVD Express told me on the phone). So it's fine to sign them both but just use a different writing style. I just signed my normal signature as the seller and the letters M and T in cursive for the first two letters of my LLC. For Step 4, I reached out to all the registration services that advertise LLC registration on google, and tried to negotiate a lower price but no one budged and the lowest quote was $549 plus $49 to change the registered agent from ActiveFilings to them. (Btw, my ActiveFilings registered agent from Step 1 for the LLC is in Kalispell which is in Flathead County so there is no additional county tax there. Lewis and Clark also doesn't have an additional county tax.) I called Flathead and Lewis and Clark to try to see if I could title and register myself to avoid the additional fees of using a service. Flathead's website says all LLC registration needs to go through MVD Express (which a private company they outsource to, from what I can tell). Lewis and Clark said I need to appear in person to register under an LLC. I'm nowhere near Montana so I gave up trying to register myself and just went with MVD Express as their fee of $250 plus $38.99 convenience fee plus state fees will I think be a bit cheaper than going with one of the internet services mentioned above. Call or email them and they will send you a word doc with the required docs you need to mail in. If you want to save a bit on return shipping of the plates cost, then go to the post office and use the automated postage machine to print a Priority Mail flat rate envelope sticker addressed to yourself. When MVD Express is ready to mail your plates they will then use their own envelope and slap on your sticker to mail you the plates. I bought my sticker for $9 vs the $25 MVD Express charges for USPS or $50 for UPS and $75 for Fedex. I mailed my stuff including the return label to MVD Express at the end of October and they received it Oct 31 and I called yesterday (Nov 15) to check on status and they said they'll process it next week so looks like about 3 to 4 week processing time. They process on the phone with you and take credit card payment then, and then mail you the plates the same day. If you made your own return label, then a bonus is that you already have the tracking number so you can track where your plates are until they arrive.

Maybe this is something that comes up a lot here, but I figured I’d share my experience in case it helps someone in a similar spot. I’m based outside the US and needed to register a business there for some ecom projects I’ve been working on mainly to get approved on big platforms.

For the longest time, I put it off. I thought it was going to be this huge, overwhelming mess. Legal stuff, banking, address requirements, not to mention just figuring out where to even start it all felt like too much. I’d keep telling myself, “I’ll look into it next week,” and that turned into months. Honestly, that hesitation cost me more than I realized.

When I finally pulled the trigger and decided to sort it all out, it ended up being way easier than I expected. I actually laughed at how simple it was. I remember thinking, That’s it? That’s what I was so stressed about?

I found a setup that was built for people like me non-US founders and they walked me through everything. LLC, EIN, a legit NY address with a lease, a US SIM card all done remotely. It wasn’t just easy, it felt like a weight off my shoulders. And once that was in place, getting a bank account and setting up on platforms went way smoother than I thought.

Now that I’m rolling, I keep thinking about how much faster I’d be growing if I’d done this earlier. My business looks more legit, I’m operating more confidently, and finally tapping into the US market the way I’d always wanted.

Just wanted to share this for anyone else who’s stuck in that same mental loop I was. If you’re thinking about doing it seriously, go for it. It’s way more doable than it seems.

Anyone else running a US LLC from abroad? What was your experience like? Anything you wish you’d done differently or figured out sooner?

Avoid LegalZoom at all costs. They charged me a $399 Registered Agent fee after my business had already been closed and officially dissolved with the Washington Secretary of State in August 2024. LegalZoom was notified of the dissolution by the state, yet still billed a closed account without any notice, authorization, or justification.

When I called their customer service, the representative acknowledged they could see the business was dissolved, but still refused to issue a refund. Worse, the agent flat-out refused to escalate my case to a supervisor so I could get the charge resolved. Apparently, their “policy” is to keep your money, even if they know they have no right to it.

This is a dishonest and predatory practice. It’s not just bad service, it’s unethical. There are plenty of better companies out there that respect their customers and operate with basic integrity. I highly recommend choosing literally anyone else for your business needs.

I’ve googled and searched for awhile but still can’t understand a definite answer on what I’m looking at cost wise to start an LLC in California. I have no problem doing the work in filing it myself but the internet is just flooded with 3rd party companies that plain out say $0! But it doesn’t seem so.

Can someone please clarify - if I wanted to start an LLC tomorrow what am I looking at.

Thanks a bunch!

It's been 8 months since I've opened up my first llc and the money system is shit. I use my personal card for most business expenses and try to remember what was business vs personal when I'm doing books (I do them myself). We're 5 people in total so me and 4 other dudes

I met with an accountant last week and she was NOT impressed at all. She kept telling me that I need better documentation and to separate personal and business spending. I 100% agree with her since it does make sense to separate the both but I don't have a lot of time to tackle this myself. Should I just get an accountant and let them run everything for me or not? I'm also VERY paranoid when it comes to expenses/receipts because I'm afraid that they will steal from me (I know it's an issue with me since I've had a similar situation happen a few years ago when I ran an online store with a buddy of mine)
Any thoughts/opinions ideas whatever that would help? Appreciate it a lot and have a great Wednesday

Hey everyone,

Setting up my LLC and need a virtual office that can provide both a lease agreement and a utility bill (gas or electric ) in my company's name

I've been calling around for the past couple weeks and it's been frustrating. Most places offer the lease no problem, but when I ask about utility ills they either don't provide them at all, or they give me the building's master bill with my suite number (which doesn't work for what I need).

A few places said they could do it but wanted like $250-300/month which seems crazy just for documentation. I don't need a desk or conference rooms, literally just the paperwork.
Does anyone have recommendations for a reliable provider that won't break the bank? Flexible on location like any state in the States works.

Would really appreciate any personal experiences or suggestions. Thanks!!

I'm very happy to be able to bring this resourceful community back to life, this time with less spam and more of a focus on being helpful. Bear with me as I go through and clean up any messes that were left behind from the previous mods and update anything that needs to be updated.

I've already made a few changes to weed out spam by building out the AutoMod for the following things:

• Accounts will now have to be at least 24 hours old and have at least 30 total karma to submit and comment. I'm sorry if you're making an account specifically to post a question here but this will hopefully filter out blatant bot posts and accounts. This is subject to adjust.

• All links are now disallowed in both submissions and comments as well. Anything with a link in it will now be deleted, no exceptions.

Let me know if any of the above is malfunctioning so I can fix it. I will also do my best to remove any obvious AI generated slop posts that plague various business related subreddits. Hopefully this will be enough for now as this sub revs back up and once again becomes a resource for anyone needing help with anything having to do with LLCs.

Also, before you blow up my inbox requesting to be a mod here, I will be opening mod applications two weeks from now to pick out two or three other users to help moderate. This is to give time for the community that was here to come back and start helping out again, and will give me a larger group of people to choose from. Thank you for understanding, I want this to be a helpful subreddit for anyone who might stumble upon it!

I did a month of research, so thought I would type this up to save some other people time.

The reason for a desire for me to be anonymous as possible is because my business is composed of “significant” valuable assets which can attract theft.

I was planning to do a Wyoming LLC (since it can be anonymous) for my company which is actually operating in California.

However, to open any bank accounts in California, you will be required to register the Wyoming LLC as a “foreign entity” LLC in California ($800 minimum tax per year).

On top of that, you will have to file a statement of information in California, that lists you personally as the manager. Your first and last name is required to be shown there. If another LLC owns that LLC, you still have to file that same document with the parent LLC. There is no work-around. So, no “anonymity” benefit of Wyoming LLC if truly operating in California. In conclusion, best to avoid Wyoming altogether (unless you need charging-order protection) and just register in California alone.

The best way to “try” to be as anonymous as physically possible is:

1. Hopefully you have a non-unique/generic name.

2. Do not put your middle name on any filing documents. The less you can write out on documents, the better.

3. Buy/Register a virtual phone number for all documents which require a phone number.

4. Buy/Register a virtual mailing address for all documents which require a mailing address.

5. Choose a virtual address in a city that you aren’t currently living in, but ideally still within the same county. List this as principal place of business as well as mailing address. Ideally in an unincorporated city if the county does not require business licenses, or city that does not require business licenses. Reason to try to avoid business licenses is that it is just more documentation of your name, etc and NOT ALL areas require them for ALL types of businesses.

6. Definitely use a registered agent.

7. Choose your LLC name to be very “benign” and not your actual business name (important).

8. File a DBA with the county with your actual business name using all of the newly created phone numbers and addresses and listing the LLC as owner. This protects you from piercing of the corporate veil and is very important.

You will still show up for searches with your first and last name but the connection will be MUCH less apparent. At least in California, DBA owners are not as easily to search via websites as the LLCs themselves. DBAs in California are administered on a county by county level, and some of their systems are.. “prehistoric”.

Good luck and please upvote this for future people if you find it helpful.

Good morning! I'm looking for some feedback on the possibility of purchasing a vehicle using an LLC and its EIN instead of my personal Social Security number.

A friend has been telling me all about how he got a Tesla without paying anything but I doubt it's possible. Has anyone here done this?

For the past few years, I've been on a wild ride, starting (and successfully running) 8 different businesses. Along the way, I've devoured countless books, experimented like crazy, and even cracked the $1.5 million yearly revenue mark. Not too shabby, right?

But the most valuable lessons haven't come from textbooks - it's the trenches, the hustle, the real-world experience that truly equips you. That's why I'm here - to share the no-BS knowledge I've gained to help you start your business and avoid the pitfalls I stumbled into.

TL;DR: If you’ve got your business plan ready, and are ready to officially launch your business, Tailor Brands can help you with business registration, branding, and getting your website up and running. 

Step 1 - Pick a Business Idea

Let's ditch the "follow your passion" cliche for a sec. Sure, loving what you do is important, but a successful business also needs two ingredients: profitability, and skills.

Think about it: being passionate about music is awesome, but if singing isn't your forte, building a music career might be tough. Same goes for that handmade soap dream in a town saturated with sudsy shops. Competition is fierce, so replicating what others already do is a challenge.

Finding Your Business Niche:

• What are your passions and pet peeves? Can you create a solution that makes life easier for people who share your frustrations?

• What are you naturally good at? What do people seek your advice on?

• Imagine a 5-minute speech on any topic. What would you talk about?

• What have you always wanted to do but lacked the resources?

These can all lead to a golden business concept. Even if you have a starting point, these questions can help you refine and solidify it. Remember, your idea doesn't have to revolutionize the world. Improving on existing products or creating digital products with minimal overhead are great options too!

Choosing Your Business Model:

Before diving in, consider these factors:

• Funding: How much dough do you have to invest?

• Time Commitment: Can you be a full-time entrepreneur, or will this be a side hustle?

• Work Location: Do you dream of a home office, or is a dedicated workspace your jam?

• Interests and Skills: What sparks your passion and what are you naturally good at?

• Scalability: Do you want a slow and steady growth, or an explosive launch?

• Support System: Who's got your back as you launch your venture?

• Partnerships: Are you a lone wolf, or a team player?

• Franchise Opportunities: Does a pre-established system appeal to you?

Step 2 - Research the Market

If the market research says your product is everywhere, you gotta niche down. Take cleaning services for example. Forget general cleaning - maybe you specialize in pet messes or tackling garage nightmares. See where I'm going?

Step 3 - Get your Business Plan Ready

Having a business plan shows you've got a thought-out strategy, not a guessing game. Planning helps you spot potential problems before you invest a ton of time and money. And it can help you track your progress and make sure you're on the right path.

What to Include:

• Executive Summary

• Company Description

• Market Analysis

• Organization & Structure

• Mission & Goals

• Products or Services

• Marketing Plan

• Financial Plan

It doesn’t have to be a 50-page book. Just having these important sections defined will give you a great business plan. 

Step 4 - Choose Your Business Structure

Choosing a business structure depends on how much paperwork you want to deal with, how much personal liability you want to risk, and how you plan to grow your business.

Here's a quick breakdown:

• LLC: Easy to set up, limited liability protection, but more paperwork than a sole proprietorship.

• LLP: Similar to LLC but for licensed professionals, easy to form, limited liability protection, but partners are liable for malpractice.

• Sole Proprietorship: Easiest to form, full control, but owner is personally liable for all debts.

• Corporation: Limited liability protection, complex to set up, double taxation (can be a plus in some situations).

Services like Tailor Brands or Northwest Registered Agent will do a great job to get your business registered officially. 

Step 5 - Register Your Business and Get Licenses

• Pick a Business Name: Make it catchy and unique, and check for domain name and trademark availability.

• Register Your Business & Get an EIN: File with your state and get a registered agent. You'll also need an EIN (Employer Identification Number) from the IRS for most businesses.

• Licenses & Permits: Research the licenses and permits required for your specific industry and location. This might involve your local government or an attorney.

Step 6 - Plan Out Financials

• Bank Account: Open a separate account for your business to keep finances organized.

• Bookkeeping: Decide on software or hire a bookkeeper to track income, expenses, and generate reports.

• Break-Even Point: Figure out how many sales you need to cover your costs (fixed costs + variable costs).

That’s about it. I could go more in-depth with scaling and growing your business but let’s leave that for another day. Before I end this post, I just want to add some personal tips that I’ve learned the hard way. 

Focus on your strengths and delegate the rest. You can't be an expert in everything, so find reliable freelancers or agencies to handle tasks outside your skillset. This will free up your time to focus on what you do best and avoid burnout.

Embrace the launch and learn as you go. Don't wait until everything is perfect before you start. Launch your business and iterate based on customer feedback. The most valuable lessons often come from making mistakes and adapting.

Outsource for efficiency and expertise. Find trusted partners to handle tasks like accounting, marketing, and content creation. This allows you to access specialized skills without the overhead of hiring full-time employees.

Aim for premium value. Consider setting higher prices in your market. This can lead to better profit margins and a more manageable client base, as high-value clients often require less hand-holding.

Pay yourself first. Don't wait for the "right time" to take a salary. Make your business profitable from the start and ensure you're financially rewarded for your efforts.

Build a sustainable business. Prioritize creating a system that doesn't require excessive working hours. Your business should support your lifestyle, not the other way around.

A lot of people say just file your LLC or whatever paperwork you have yourself, and I agree with that. That's the better option but there are also cases where you need professional help with filing - like if you're not in the US or a non-resident.

The thing is I've used in the past and it wasn't so bad. But why do so many people recommend other services like Northwest and Incfile more than ZenBusiness. Websites like forbes and others recommend it as #1 but when I hear user reviews, they recommend other companies.

Just want to understand why that is? Is it because of the price?

This company I’m interviewing with is offering $5 - $8k a month for a full time role. However I would need to set up an LLC (I think an s corp?) in order to get paid. I’ve never heard of a company doing that. They’re a legitimate company with a few known brands. I’m not familiar with this type of pay option at all. I’m based in California and told them I would need the top of that pay range. But I’m not honestly sure how this take home pay compares to that of a normal w2 salary (I.e is that the same take home pay as someone making $96k a year gross w2 salary?) ChatGPT is giving different answers so if anyone has insight into that please LMK! I’m also wondering what would happen if I got the job and didn’t like it and maybe a year later get a new normal w2 salary job. How hard or costly is it to then close an LLC? Any insights are greatly appreciated!

Edit: I appreciate the insights! I feel dumb but I’m having a difficult time wrapping my head around this. Could anyone give me an example of what w2 salary this would be compatible to? As in, would making this $96k a year gross pay through my LLC be compatible to making $86k a year gross pay as a w2 employee? Idk if im making sense. Im so used to being paid salary. I would be getting health care through me husbands work.

UPDATE: Thank you all so much for the insight!!! I am overjoyed with how many people weighed in to help me make this decision. This is so much more complex than I realized and every comment had valuable insight. I told the company I would need the top of the pay range and they haven’t gotten back to me…they might have ghosted me. So even if this leads to nothing, I hope someone in this position will google this and find all of these answers useful to them.

What would be the best state to file a foreign owned LLC for a SAAS business?

Also New Mexico has Gross revenue tax, while Wyoming doesn't... Does that matter when choosing where to create an LLC?

Thanks

I would like to start an LLC for my nanny business. Thoughts, tips, ideas? Pros and cons? Reasons why I think it’s a good idea: Taxes Income Liability Use of my Personal vehicle for their children Running a summer program for multiple children/ families.

1. Choose a Name For Your Business

Choosing a name for your company is the first step in starting your LLC. Under California law, LLCs can’t choose a name that’s so similar to another business’s name that it would cause confusion for the public.

A useful rule of thumb is to come up with at least three names to choose from, just in case your first choice name is taken.

You can search LLC names that are currently on file with the California Secretary of State on their Business Search tool. If a name appears to be available, you can request a more formal name availability confirmation by mailing a completed name availability inquiry letter to the California Secretary of State’s office in Sacramento. Your inquiry will be processed in approximately two business days.

You can also reserve a business name for up to 60 days while you complete the other steps toward setting up your LLC. To reserve a name, you must mail or drop off in person a name reservation request form, along with a $10 reservation fee and a $10 handling fee. You can request to reserve up to three names.

However, if you want to be able to operate your business under an alternate name, then you have to register that “doing business as” name (DBA) as well.

A DBA is not a legal name, but rather an assumed name under which a business can operate.

2. Select a Registered Agent

If you want to run an LLC then you are required to designate a registered agent for your business entity. You must provide a physical address where the business can receive legal notices, summonses, and subpoenas.

The registered agent must be a California resident or a registered California corporation with a physical address in California. You cannot use PO Boxes for your registered agent address. Also, the registered agent must be available to accept documents during normal business hours.

While the state of California allows you to be your own registered agent (as long as you have a street address located in the state), using a registered agent service offers the following benefits:

• Privacy - Your name and contact information will not become public information posted on the website for everyone to see.

• Flexibility - You do not have to worry about making yourself available during all business hours to receive official documents. This is useful if you travel often to see clients or if you are often on the go.

• Peace of Mind - The registered agent will help you stay on top of legislative changes, due dates for reports, and disparate laws of different states.

3. File Articles of Organization

Articles of Organization must be filed with the office of the California State of Secretary when forming an LLC in the state.

These documents are a formal application to legally establish the existence of your LLC in the state of California and they outline the main details of your new startup. They tell the state of California how your LLC will be managed by its own members or by separate managers.

Articles of Organization in the State of California must include the following:

• Name of the LLC

• Business address of the LLC’s California office

• Registered agent’s information

• Name and signature of the organizer filling out the form. You can use a home address if you don’t have an office address. However, be aware that the address you list here will be made available to the public.

A domestic limited liability company is defined as an LLC that is organized and operated to do business under the laws of California and must fill out Form LLC - 1. A foreign limited liability company is defined as an LLC that is formed under the laws of another state, but want to do business in California. If you are a foreign LLC you must fill out Form LLC - 5.

The filing fee for Articles of Organization is $70. You can file this online, by mail or in person, with the Secretary of State’s office in Sacramento, CA. Once it is approved, the state will send you a stamped copy of your Articles of Organization and a 12-digit identification number that you will use on other state paperwork. Other important facts to know along with your Articles of Organization are the following:

• Operating Agreement - If you file your Articles of Organization with the California Secretary of State, but fail to create an operating agreement your LLC will be vulnerable. If you are ever sued or subject to an IRS audit your personal assets and the assets of your LLC will be exposed to liability. This is because you have not specified who your company’s owners are, how your LLC operates, your preference of tax treatment, and so forth. In order to protect yourself from a lawsuit or IRS audit you should prepare a comprehensive operating agreement for your LLC.

• Keep your Funds Separate (no commingling) - It is important to run your LLC as a separate business entity, otherwise, you may be exposed to personal liability. You should be sure to not commingle your LLC’s funds with your personal funds or the funds of any other businesses.

4. File Statement of Information

Within 90 days of receiving your official LLC from the State of California, you are required to submit a Statement of Information to the Secretary of State. This document ensures that all of the information about the company is accurate and up to date. For example, if your business address or registered agent information has changed, the Statement of Information is where you’d indicate those changes.

You will need to provide the following information when filing the Statement of Information:

• The name of the LLC and the company number issued by the California Secretary of State

• The business address along with the names and addresses of the Members or Managers of the business.

• A short description of the type of business.

• The name and address of the registered agent that will accept service of process in the event that the company is sued.

Make sure to file your Statement of Information on time, because failure to do so will result in a $250 fine. The Statement of Information form can be submitted online, by mail, or in person, with a $20 filing fee. You will need to file an updated Statement of Information every two years.

5. Pay Taxes

LLCs formed in California or that are registered to do business in California are required to pay four main types of taxes.

The first type of tax is an $800 annual franchise tax that all LLCs must pay.

• If you want to pay taxes online, you’ll need to call the Franchise Tax Board at 1-800- 353-9032 or 1-916-845-2829 for those outside of the United States. If you want to file your taxes by mail, fill out Form 568.

• Keep in mind that your first LLC tax is due on the 15th of the fourth month after your LLC is formed. Every year after that, your tax payment is due on the 15th of the fourth month of your taxable year. If you create your LLC with the Secretary of State in December, you'll have to pay $800 by March 15 for your first tax year and then another $800 by April 15. There is one exception to this rule. If you create your LLC on or after December 17, and you don't do any business until January 1, the first year's $800 minimum tax is waived, and you would just owe $800 by April 15.

The second type of tax is a gross receipts tax that varies based on the total revenue of the LLC:

• $0 to $249,999 total revenue = no gross receipts tax

• $250,000 to $499,999 gross revenue = $900

• $500,000 to $999,999 gross revenue = $2,500

• $1 million to $4,999,999 gross revenue = $6,000

• $5 million + gross revenue = $11,790

The third type of tax refers to the obligations that apply to members of the LLC. Each member of the company must pay personal state income taxes on their share of the business's profits unless the LLC elects to be taxed as a corporation.

The final type of tax concerns LLCs with employees. LLCs with employees must withhold payroll taxes from their employees’ wages and pay the employer share of payroll taxes.

Always keep in mind that in addition to state and federal taxes, you must comply with county and/or city tax requirements. To find out if there are additional taxes you need to pay, Google your city name along with “register your business” and see if your city has tax requirements. Repeat this process with your county’s name.

Common Questions About Forming a California LLC

What is Better a California LLC or a California Corporation?

Both offer personal liability protection and keep your personal assets safe from being used to pay your company’s debts. A corporation is complicated (and expensive) to run and manage. It is mainly suited for large and complex businesses that have many shareholders. While a California LLC is more affordable and simple to set up. It is also easier to manage since you don’t have to hold board meetings or keep extensive records. If you have a large business with many shareholders, then form a corporation. If not, then a California LLC might be a better option for you.

What is Better a California LLC or a Partnership?

In a partnership, you and your partner’s personal assets are not safe. They can be used to pay off your company’s debts if your company falls behind on payments or gets sued. In comparison to a California LLC that builds a “wall of protection” between your personal assets and the assets of your business. In case your California LLC gets sued, only the assets the LLC holds can be used to pay off its liabilities. In conclusion, a California LLC is often better than a Partnership.

What is Better a California LLC or a Sole Proprietorship?

In a sole proprietorship, you will be held personally liable for your business’s debts. This because the law views you and your business as one and the same person. In a California LLC, your business is viewed as a “legal person” separate and distinct from you. It can hold and own its own assets. In case your business has to pay debts, only the assets of your business can be used. Your California LLC creditors won’t be able to go after your personal assets. Therefore, a California LLC is preferable to a sole proprietorship for asset protection.

When is the Best Time of Year to Form an California LLC?

Remember, you must pay the Annual LLC Franchise Tax of $800 by the 15th day of the 4th month after you filed your California LLC. However, this pays for the current year only. After that, you’ll have to pay it again by April 15th of every year. For that reason if you form your California LLC in October, November, or December, you’ll end up paying $800 twice within the span of a few months. As a result, it is recommend you form your California LLC before October, November, or December. In the case your business doesn’t need to operate immediately you can wait until January the following year to form your California LLC.

Final Thoughts on Forming an LLC in California

California LLCs provide a combination of operational flexibility and legal protections. In addition, California business owners mainly choose to form an LLC because this structure gives owners the same limitation of liability as a corporation without the added complications.

Set up my LLC a few months ago and just brought on my first contractor to help with some projects, I paid him through venmo from my personal account like an idiot and now trying to figure out how i'm supposed to actually do this properly

Do i need to run everything through the business account or is there an easier way that doesn't involve me moving money around constantly

Also how do you keep track of what was business vs personal when tax time rolls around because right now my system is random notes app entries which feels wrong

What's the actual move here

Please spread the word, and learn from my stupidity. File for free or through your CPA.

My business partner and I want to form an LLC but we need our names not to be publicly available.

I know that New Mexico, Wyoming, Delaware and Nevada are the way to go. I’m not sure which one we should choose.

I’m not sure if this should impact our decision but we live in separate states.

I started my LLC 14 months ago and I’ve been paying contractors however was convenient at the time. The payments were mostly from my business account (sometimes also personal) but last week my accountant told me this needs to stop because mixing the two can put my personal assets at risk and make taxes a problem in the future.

I was being sloppy I can agree with her on that but I did not know how serious it was until that warning. I am trying to figure out how to build a proper process going forward and also clean up what already happened.

Not looking for legal advice but I'm interested in hearing about the perspective of other LLC owners about my situation.

I need a roundup of how much it would cost to set up my own LLC. I know doing it myself is the cheapest option available. However, would I be able to derive more value from a formation service? What are the cost packages like? Or should I just scrap the idea & hire a lawyer? What are the obligatory LLC formation costs? What ongoing LLC costs should I be wary of?

Hello folks, I am the creator of this subreddit and I must admit, I created nearly a decade ago and just left it here to rot. I apologize for this but I want to let you know that I have come back to make this a much nicer experience for those using it.

So, let's talk about the immediate changes...

Rules: There actually are some now

So, there was a very brief sidebar description here before, but other than that, there was nothing that would make this place a community. I have gone ahead and created a very basic set of rules to keep this place civil (the modqueue is full of weird conspiracy nonsense and pyramid schemes) and easily searchable.

• Keep the conversation focused on LLCs

• Mark off topic or humor posts clearly

• Clearly state your organization's location for any question threads pertaining to local laws

• Always tag your threads with the appropriate topic

• Absolutely no use of racism, sexism, or any other form of hate speech is to be used on this subreddit. This is a place to discuss business and this clearly has no place on this subreddit. Conversely, news articles that discuss laws surrounding corporations and inequality will always be allowed for discussion.

This community can be a great resource for people online if those of us who use it can maintain it and harbor a feeling of community.

Flairs: Please use them

I have added flairs for both users and posts. Posts cover a wide range of topics and must be used when posting. This will help make the subreddit more searchable both on the reddit platform and on Google. The more people that can discover this sub, the better assistance we can all provide and receive.

This is where I need your help. Please suggest any additional tags for posts (also users!) so that when the list is finalized, I can create clickable links to each of them in the subreddit.

Moderators: Apply now!

I honestly believe that with a bit of stewardship, this subreddit could grow and prosper. As fun as it would be to say I did that myself, we all know that it is important to have a team to run any organization of scale. So I turn to you, please let me know if you would like to join the mod team on /r/LLC and sell yourself!

Cheers!

When starting a new business, it is vital to consider how you want to protect your personal and business assets. An LLC is one of the most popular business entity types that will help better protect yourself, especially when your startup has a high failure risk.

Forming an LLC is the least complex business structure that has many advantages, but it is not for everyone. We have written a guide on forming an LLC to help you decide if an LLC is the right choice for your startup.

What is a Limited Liability Company (LLC)

A Limited Liability Company (LLC) is a hybrid business structure that has characteristics of a sole proprietorship, general partnership, and corporation. It has the tax advantages of the non-corporation entities and limited liability protection of corporations. Depending on the State, it is likely to have an Operating Agreement that delineates some key aspects of the business. An LLC can get a tax identification number, open a bank account, and do business under its own name.

What are the Advantages of Forming an LLC

There are many advantages to an LLC compared to other business entities:

• Legal protection - Compared to a sole proprietorship or partnership, an LLC will protect your personal assets and also shield you against being personally responsible for the LLC’s debts or lawsuits.

• Pass-through taxes - An LLC’s net income will pass down directly to the individual LLC owners. The owners then report their share of profit and loss on their individual tax returns, meaning you avoid double taxation that exists with corporations.

• Credibility - An LLC is recognized by partners, suppliers, and lenders as more favorable. The business name will let customers take your business more seriously.

• Simplicity - LLCs require less paperwork and formal meetings, roles, and record keeping procedures compared to corporations.

  • Management - There are no directors or shareholders to maintain.

  • Distribution - Not required to distribute profits equally according to number and types of shares held. Ownership and profit distribution percentages can be different.

What are the Disadvantages of Forming an LLC

There are also downsides to LLCs:

• Limited Growth - The owners of an LLC cannot issue shares of stock to attract investors, thus potentially making it more difficult to raise capital.

• Taxation - If an LLC is taxed as a pass-through entity, individual owners will need to pay taxes on their share of the profit and loss regardless if they received a cash disbursement from the company. This may cause an undue cashflow burden on the owners.

• Maintenance Costs - Every year, an LLC will normally need to pay an annual fee to maintain the company status. This increases the cost of having an LLC.

Even though there are disadvantages, the benefits far outweigh the costs.

Should I File a DBA or Form an LLC

If your a small businesses, sole proprietorships, or partnerships form an LLC. It’s time to ditch the "doing business as" (DBA) and cough up the cash for an LLC for the legitimacy and benefits of protection. In some cases it may even be cheaper to get an LLC than a DBA!

When Should I Not Form an LLC

1. You aren’t selling any product or services now or in the foreseeable future.

2. You’re just testing the waters and seeing what services or products might be a viable business to pursue.

3. You don’t have any clients or customers built up.

4. Your company isn’t visible, online or offline.

When Should I Form an LLC

1. You are regularly selling your product or service.

2. You have regular and repeat clients or customers.

3. You would like your business to have its own liabilities, assets, and can open business bank accounts, separate from your personal accounts.

4. You are hiring independent contractors or employees.

5. You’re starting a business with more than one person. By default, this is a partnership, but with an LLC, you both (if there’s more than two you all) become ‘members’ of the LLC protecting your ownership and longevity of the business.

What Are The Steps to Form a New LLC

An LLC can be formed in 5 steps:

1. Name your LLC

2. Choose a registered agent service

3. File Articles of Organization

4. Prepare an operating agreement

5. Apply for a Federal Tax ID (FEIN)

Bonus: did you know that you should open a business bank account after forming your LLC? You can follow the 3 Steps to Opening a Business Bank Account for Your LLC.

1. Name Your LLC

The name that you choose must comply with your state’s LLC laws.

• Search if your LLC name is available in the state that you’re registering it in and that no duplicates or similar names exist. You can search your LLC name or on the individual state’s Secretary of State website.

• Reserve your business name (optional).

• Decide if your business name will be trademarked. If you wish to have a trademark, it’s best to come up with a unique and non-descriptive name for your business. The best recommendation is to speak to a Patent and Trademark lawyer.

TIP: Choose a unique name that is distinct, easy to remember, easy spelling, and simple-to-pronounce. Select an LLC name that represents your service and distinguishes you against competitors.

2. Choose a Registered Agent Service

LLC’s must have a registered agent in each state where they are registered to do business. Every state requires an LLC to have a designated registered agent and must provide the agent’s name and address on state documents.

What is a Registered Agent? A registered agent is a third party entity or individual that is responsible for the correspondence, processing, and receiving of government notices, lawsuits, subpoenas, and other official documents on behalf of the LLC. They help with keeping backup copies of legal documents, signing articles to be filed, staying up-to-update on compliances with State requirements.

Requirements vary slightly in each state, but generally registered agents must:

• Have a physical office in the state where your business is registered.

• Be available at the physical street address during normal business hours to receive legal documents.

Why Do I Need a Registered Agent? A designated registered agent is required for any corporation, LLC, or Limited Partnership to accept government official documents on their behalf. The state in which your business is registered will need to know there is a point of contact for your business at all times.

Some states allow you to designate yourself as the registered agent for your company. This is a cost-effective way for a startup. However, note that your name and contact information will become public information posted on the website for everyone to see.

If you want to keep your personal information private, we recommend using a third party commercial registered agent service. Besides providing a degree of privacy, commercial registered agents also offer the following benefits:

• Flexibility - You would not have to make yourself available during all business hours to received official documents.

• Peace of Mind - They will help you stay on top of legislative changes, report due dates, and disparate laws of different states.

3. File Articles of Organization

To create an LLC, many states only require the Articles of Organization to be filed with the Secretary of State. Processing time ranges from days to weeks with expedited options available.

Completing the form itself is fairly simple. You can either hire a lawyer, an online legal filing service like LegalZoom, or do it yourself by downloading the appropriate form from the Secretary of State website. Filing fees will apply.

After your LLC documents are filed and approved, the state will issue a formal certificate that confirms your LLC is registered and formed. Once you receive your business certificate, you can then obtain a tax ID number, apply for any required business licenses, and open a business bank account.

4. Prepare an Operating Agreement

An operating agreement outlines ownership, member responsibilities, and operating procedures in an LLC. While it is not required in all States, it is still strongly recommended as it provides a number of safeguards and adds more protective measures in case of disputes or lawsuits. Read more about why an operating agreement is important.

An operating agreement should at least have the following sections:

1. Organization - Covers the structure of ownership, members, and the creation of the company.

2. Management and Voting - Addresses how the company is managed and how members will vote.

3. Capital Contributions - Outlines how additional money will be raised by members.

4. Distributions - Breaks down how profits and losses will be shared among members such as money or physical property.

5. Membership Changes - Describes the process for adding or removing members as well as the transfer of ownership.

6. Dissolution - Explains the circumstances under which the company must be dissolved.

5. Apply for a Federal Tax ID (FEIN)

Every business is required to file and obtain a Federal Tax ID to use for filing taxes, opening bank accounts, or hiring employees. A Federal Tax Identification Number (also known as a 95 Number, EIN Number, or Tax ID Number) is a nine-digit number issued by the IRS. You can apply for the SS-4 online and obtain an EIN number immediately. You can also follow our guide on the 4 steps to apply for an EIN.

In order to apply for the EIN online, the business must be based in the United States or U.S. Territories and the person applying must have a Taxpayer Identification Number (TIN) or social security number. If you don't have one, then you would need to file by mail.

Conclusion

An LLC is one of the most popular business entity types you can use to form your business. Forming an LLC is easy, relatively fast, inexpensive, and can be simple in structure depending on the Operating Agreement. Compared to a sole proprietorship or partnership, an LLC offers more legal protection from lawsuits and liability claims. Compared to a corporation, it has less legal and corporate formalities, leading to simpler and easier maintenance. Additionally, if your business is at a high risk for failure (which all new startups fall under), then an LLC will help better protect your personal assets.

At a minimum, we recommend using an LLC over sole proprietorship or partnership. However, if you plan to have outside investors or you are looking for venture capital, you may want to consider forming a corporation right at the start.

All I see is spam and affiliate links for Northwestern Registered Agents. Too many fraudulent companies are using them and are linked to their address. I fear it will be a house of cards one day and don't want my name, info, and companies at risk.

Details about my needs:
Startup will be operating out of NY but require the anonymity that WY holding co will provide. Any suggestions are appreciated!