You want to start a limited liability company (LLC), but you’re not sure how.
Agitate: Forming an LLC is a complicated process that requires many different steps and forms. It’s hard to know where to start or what information you need.
Solution: We’ve got you covered with our step-by-step guide on how to form your own Georgia LLC in less than 20 minutes! All the information you need is right here, including all the forms and fees for starting your business.
First, you will need to name your limited liability company. According to Georgia law, you can’t use a name already in use by another company or is prohibited.
You may trade under your name, under a name you are doing business with, or under a fictitious name.
Register an LLC with the Georgia Secretary of State.
To register your LLC with the Georgia Secretary of State, you’ll need to file an Application for Registration.
The filing fee is $100.00 and will be submitted with the application.
You will also need to submit a Registered Agent Agreement, which should be signed by all members of the company and notarized.
A copy of your Articles of Organization is also required, which should include the name of your company and the information on how you are organized.
Lastly, you will need to submit a Statement of Qualification and agree to all licenses, rules, and regulations that govern this process.
Create & File Registration Documents
Once you’ve gathered the necessary forms and documents, you can fill them out and mail or deliver them to your Secretary of State.
You will need to give the following information:
- The name reservation of your limited liability company.
- The date the LLC was formed.
- Your Registered Agent Name, Address, and Phone Number (if applicable).
- A copy of your Articles of Organization.
- A copy of your Statement of Qualification for the LLC.
- A $100.00 filing fee, which you can pay by check or money order.
Note: You may have to get a tax ID number from the IRS and use it on your form to not tax your entity twice. See the final question below for more information.
Do I Need a Tax ID?
You don’t need a federal tax identification number (EIN).
However, if your LLC will report any income or pay business taxes, you will need an EIN. You will need to apply for one separately from the Georgia Secretary of State to get an EIN.
Your tax ID number will be unique and can’t be used by anyone else. Therefore, it is crucial to choose your number wisely.
Starting an LLC in Georgia
Starting to form an LLC in Georgia is easy. Just follow these simple steps.
STEP 1: Name Your Georgia LLC
The name of your LLC can be any combination of alpha-numeric characters.
There are stringent rules regarding the naming of your LLC in Georgia. For instance, there are names that an LLC can’t use.
Here are some of the prohibited names:
- Names that contain trade names, trademarks, or words used to describe a product or service, such as “the New York Yankees,” “the Coca-Cola Company,” “Liberty Mutual,” or “GEICO.”
- Names of a national, state, or local government entity.
- Names that are confusingly similar to another character. For instance, the term “United Federal Credit Union” is too similar to the well-known credit union “United Federal Savings Bank.”
- Names that are or contain a variation on a word or phrase, including misspelling or abbreviation, solely for the purpose of being even more descriptive. For example, if your business is named “BBQ Ribs,” it can’t be called “Ribs BBQ.”
STEP 2: Choose a Registered Agent service in Georgia
A Registered Agent is a person or business entity appointed by the LLC to receive legal documents. This includes all official court papers like summonses, complaints, and subpoenas.
Typically, the Registered Agent of an LLC in Georgia is its manager or proprietor.
However, it can be your CPA, attorney, member/manager/director, subsidiary, parent company, or anyone you choose.
It is essential to name a person who will receive the official papers. This helps avoid costly mistakes, delays, or interruptions.
Georgia law requires you to use a Registered Agent, which can be the title of a corporation, an LLC, or other business organization.
FAQ: Choosing a Registered Agent service
Q: Who can be a Registered Agent in Georgia?
A: Anyone can be the registered agent of an LLC, corporation, or other business organization.
The person may have to be approved by the secretary of state before they are appointed.
This includes your attorney or CPA as well as your bank for receiving deposits and payroll checks.
Q: Does my Registered Agent need to receive official papers on behalf of my LLC?
A: Yes. In Georgia law, you must use a registered agent for the entity you’re forming to receive legal documents from entities like courts and government entities, including all official court papers like summonses, complaints, and subpoenas.
Q: Where should I list my Registered Agent’s Name & Address?
A: Once you’ve named a person your registered agent, they must be listed by their name and address or logo (if applicable) in the Georgia Secretary of State’s Corporate Division.
On the application, you should also list their information along with a Tax ID number if applicable.
STEP 3: File Your Georgia LLC Articles of Organization
The Georgia Secretary of State’s office will also give you a form for filing the Articles of Organization. This is also where you’ll list any names that your company might have used in the past.
Remember, this information is vital to keep track of. You will need to know when your LLC was formed to do all annual filings on time.
The Georgia Secretary of State’s office will review all documents and files of your LLC within two weeks.
STEP 4: Create a Georgia LLC Operating Agreement
An LLC Operating Agreement is a document that defines the rules of how your LLC will operate.
The first section will be the Purpose and Nature of the LLC. Here you can include specifics about how the business will operate, such as its purpose, types of activities, and who is entitled to receive profit or losses.
In the second section, there should be information on Management, Officers, and Members.
You should state how ownership is divided between members/owners along with officer’s and directors’ names.
The third section for an LLC Operating Agreement in Georgia will be Distributions. Here, you can include rules for distributing profits, offset losses, and buy/sell arrangements.
The fourth section is Forfeitures for an operating agreement in Georgia. This covers rules about what happens to the LLC if a member or owner leaves, dies, or becomes incapacitated.
STEP 5: Get a Georgia LLC EIN
The most important part of starting an LLC in Georgia is getting your Federal Employer Identification Number (EIN). There are two ways to obtain one.
Tax identification number: If you are an individual who receives income in the form of a salary or wages, you can apply for a federal tax ID number.
This way is slightly less expensive but will require that you submit some additional paperwork and follow definite rules.
EIN: If you are an organization, such as a corporation or LLC, you must apply for an EIN. This is the most expensive option and will require that you submit tedious forms with even more paperwork.
The IRS will issue the EIN to identify your business entity in various federal tax filings uniquely.
Filing your United States LLC Articles of Organization with the Georgia Secretary of State’s office should not be confused with filing your EIN.
When you file Articles of Organization, you will be asked to list a Tax ID number.
In Georgia, this number is called a Federal Employer Identification Number.
Your business must have an EIN in order to qualify for the LLC tax exemption.
Or Simplify Consider Using an LLC Formation Service
АAn LLC formation service can help you form an LLC in Georgia very quickly and easily. You will be asked to list the name of the entity, address, date formed, etc.
However, they will also ask you to include other information like what the purpose of your LLC is, names and titles of all members or owners (managers), and even details about your business activities.
The service will then file Articles of Organization with the secretary of state on your behalf. That is all you have to do.
Best LLC Formation Service in Georgia – Zenbusiness
The best method how to form an LLC in Georgia is to use an LLC formation service. You will be asked to list the name of the entity, address, date formed, etc.
However, they will also ask you to include other information like what the purpose of your LLC is and other important details about your business activities.
An LLC formation service will help you easily file your Articles of Organization with the secretary of state. That is all you have to do when working with these particular services!
Pros of Zenbusiness
- Simple and Easy to Use with Less Paperwork
- Save Time, Spend Less Money
- Wide Variety of Services Offered
- Low Cost in Georgia
- The charges are commensurate with the complexity of the project.
Separate Your Personal and Business Assets
If you have a business and want to start an LLC in Georgia, then it is important for you to separate your personal and business assets.
This will help you avoid any possible legal problems or conflicts of interest if, for example, someone dies or becomes incapacitated.
This separation can be done in several different ways. One way would be for the members/owners to form a general partnership with each other that owns the LLC’s assets jointly.
Another option would be to form an LLC and purchase all assets of the company with its own funds.
The last option would be for each member/owner not to have any ownership stake in the limited liability company (LLC).
1. Opening a business bank account in Georgia
In the United States, banks have certain rules that they must follow when providing services to businesses.
For example, opening a business bank account is governed by the Patriot Act and requires a bank to verify your identity.
If you are using an LLC as your business structure, in addition to your personal identity, you will also need to provide proof of your business’s existence.
The options for opening a business bank account in Georgia consist of either doing it yourself or hiring a service company.
2. Getting a business credit carв
Business credit cards can make it much easier for you to manage the expenses for your LLC. They can also provide certain tax benefits if you use them correctly.
If you plan on using credit cards as a way of managing your business funds, then it will be important for you to get business credit card accounts.
In Georgia, there are two basic methods that businesses can use to obtain a new card: they can apply directly through the bank or they can work with an independent service company.
3. Hiring a business accountant
The United States tax code is very complicated. In most cases, businesses have a basic idea about what their tax obligations are when they first begin operations.
However, many times, it may be necessary to consult with a professional accountant.
Depending on your business type and the amount of income you make, you may be required to file different forms with the Internal Revenue Service (IRS).
In Georgia, several professional accountancy firms are in operation. They will offer various services designed to help your business.
Get Business Insurance for Your LLC
If you want to start a business in Georgia, it is important for you to do your research on the different types of business insurance available.
You will be able to choose from options that are outlined below and will have options that include coverage for items such as property damage and bodily injury.
This type of insurance will cover the physical property that your LLC owns.
In most cases, this coverage will be relatively inexpensive, but you should speak to an insurance agent or company for a customized quote on your particular needs.
Bodily injury/personal injury protection
If someone were to become injured while on the premises of your LLC, the business would have to pay out of pocket.
However, you can purchase coverage that would cover the costs associated with an employee’s injuries.
General Liability Insurance
This type of coverage will extend to claims and lawsuits that result from negligence on your part.
If someone were to fall on the property, for example, and they sustained a serious injury, then you could be held accountable.
This business insurance option protects your assets by covering negligent acts among other things.
Create Your Website
You should have a website in place before you start your business.
It will allow you to advertise your services, keep people updated on the progress of your business, and keep up with trends in the industry.
If you want to create a website for your company, then you will have the following options available to you.
- Do It Yourself – This is ideal for small businesses since it does not require a lot of time and money. The downside is that doing it yourself may not be the most effective solution for an LLC.
- Use an online service – This option is very easy to use, but you will need to pay a monthly fee for the upkeep of your website. It is great for professionals, and it can easily be updated with the latest information.
- Hire a freelance web designer – The benefit of working with a freelance web designer is that you can continue to work with the same person over time if you are pleased with their work.
Georgia LLC Tax Filing Requirements
Source: Internal Revenue Service
The State of Georgia has a series of documents that business owners must be aware of if they are planning to operate in the state. These include the following:
- Articles of Incorporation – This document is used as a legal document that outlines how your LLC will operate. It is also used to report to the state on how your LLC has performed financially. It will be provided by the Secretary of State for a nominal charge.
- S- Corporation Election – This document is used by LLCs that want to operate in a specific way. A C-corporation operates on the principle of the corporation being treated as a separate entity from its owner. However, when you file this document, your LLC will be considered an S- corporation. This will allow you to get taxed only once on the profits made by your company.
- Employee’s Withholding Allowance Certificate – This document is used to prove that your LLC has employees. This is a document that needs to be filed each and every year. If you fail to file it, then you will be subject to fines from the IRS.
- Business Tax Returns – Every LLC must file a business tax return with the state annually for income earned in the previous year. These returns are usually due by April 15 of each year. If an LLC fails to file this return, then it will be subject to fines from the state.
- Sales Tax Return – Each and every business in the state of Georgia must file a sales tax return annually. If they do not, there will be fines imposed by the state.
- State Corporate Franchise Tax Return – This is a quarterly tax that must be paid by all S-corporation owners. This form must be filed with the state annually in order to remain active in this type of corporation.
- Georgia Franchise Tax Return – This return is used by LLCs that want to operate as C-corporations. It must be filed annually.
Hiring a Business Lawyer in Georgia
An attorney will be able to provide you with guidance as you start and run your business in Georgia. The following are some of the things that an attorney can help with when running a business:
- Understanding the different state laws that apply to your business – Many people are confused about the laws that govern their business plans. An attorney will be able to provide you with legal documentation as needed.
- Obtaining licenses and permits – Many businesses require a special license or permit from the state in order to operate. An attorney can guide you through the process of getting these types of documents.
- Setting up a formal structure for your business – Each state has its own requirements for operating entities. An attorney can help you understand these requirements and help plan accordingly.
Georgia Sales Tax
Many companies are required to pay sales tax for the goods and services that they purchase for their store. This is called paying sales tax in Georgia.
No matter where your business is based in the state of Georgia, you may have to pay the sales tax due to the Gross Retail Value (GRV) of your goods purchased.
Generally, Georgia only charges you an extra 2% on top of the local retail prices when you charge them a certain amount. The twist to this is that there are different GRVs for different items.
Federal LLC Tax Filing Requirements
If you want to keep your business out of the IRS’ sights, then you will need to make sure that your LLC is doing everything it can to pay its tax obligations. This means keeping a careful eye on whether or not the LLC is abiding by federal tax laws.
When operating in an LLC, you have the choice to make it a C-Corp or S-Corp. Each type has an impact on how much taxes you pay and how much of a liability you are depending on its type.
Georgia LLC Annual Registration
The annual registration fee for your LLC is $50 in Georgia, which includes a one-year certificate of registration and a certified copy of the charter document.
Hiring Employees in Georgia
There are two different types of employment in Georgia. One is traditional employees, and the other is independent contractors.
In general, employers have to pay taxes on the wages they pay their employees.
Some businesses use independent contractors instead of employees, but they don’t have to pay payroll taxes.