Congratulations! You have taken a bold step and decided to open your own business. Like many of those before you, you are filled with excitement and can’t wait to serve your first customer. There is only one problem, you don’t know where to begin, but don’t worry, we’re here to help.
Before you start your business, you need to decide what business formation type is right for you! One of the most common choices, and the one we will focus on in this post, is a Limited Liability Company. In this post, we’ll share the 4 steps to open an LLC in South Carolina.
Step 1: Business Name Lookup
Step one in setting up an LLC is choosing the name in which you will do business under. This name should meet all of the South Carolina naming requirements and be easily searchable by future customers.
South Carolina Naming Requirements:
- The name must include the phrase “limited liability company” or LLC.
- The name cannot include words that could confuse your LLC with any government agencies such as the FBI, Treasury, etc..
- There are restricted words that may require additional paperwork, such as doctor or lawyer, to be used as part of your LLC name.
- Next, check and see if the name is available in South Carolina. This can easily be done by visiting South Carolina Business Name Search.
We also recommend that you check to see if your business name is available as a web domain. A quick google search should provide you with the answer. Even if you don’t have intentions of setting up a business website today, go ahead and purchase the domain to prevent others from acquiring it.
Step 2: File the Articles of Organization
To register an LLC with the state of South Carolina, you must file the Articles of Organization. This is easily done online at businessfilings.sc.gov/BusinessFiling. There is also an option to fill out the paper fillings and mail-in, but this will take more time to have your business recognized.
When filing, you will be prompted to make yourself a registered agent or assign this to another individual or business. A registered agent is a person or business that agrees to send and receive legal papers on behalf of your LLC. A registered agent must be a resident of South Carolina or a corporation authorized to transact business in the state.
The State Filing Cost is $110, payable to the South Carolina Secretary of State. Processing Time is 24 hours online, 5 to 7 business days by mail.
Step 3: Create an Operating Agreement
Though Operating Agreements are not required in South Carolina, we recommend having one. An operating agreement is a legal document that outlines the ownership and operating procedures of an LLC. This document will save future headaches by ensuring all of the business owners are on the same page. Still Water Financial Operations can help you find a local attorney and ensure this is professionally done.
Step 4: Obtain an EIN
An EIN is the Employer Identification Number or Federal Tax Identification Number. This number is essentially the business’ social security number and must be protected as such. The EIN is required to open a business bank account, communicate with Federal and State tax agencies, and hire new employees for the company. The EIN is obtained from the IRS online here: Apply for an Employer Identification Number (EIN) Online.
Conclusion
As you can see, forming an LLC in South Carolina can be a breeze. By following this guide, you will have your business up and running in no time. As always, if you have any questions feel free to contact us on the contact page. Stay tuned for part two of this guide and find out what to do after forming your first company!