Congratulations! You’ve taken the important step of forming a limited liability company (LLC). Now that the paperwork is filed and the dust has settled, you’re probably wondering what comes next. Don’t worry, you’re not alone. Many new business owners are unsure of what to do after forming an LLC.
That’s why we’ve put together this handy guide to the essential post-formation tasks you can’t miss. By following these steps, you’ll be well on your way to setting your LLC up for success.
1. Obtain an Employer Identification Number (EIN)
An EIN is a nine-digit number that the IRS assigns to businesses for tax purposes. It’s like a Social Security number for your business. You’ll need an EIN to open a business bank account, hire employees, and file certain tax forms. You can get an EIN for free online at the IRS website.
2. Open a Business Bank Account
Keeping your business and personal finances separate is essential for both legal and accounting reasons. Open a business bank account in the name of your LLC. This will help you track your business income and expenses, and it will make it easier to file your taxes.
3. Create an Operating Agreement
An operating agreement is a legal document that outlines the ownership structure, management rights, and profit-sharing arrangements of your LLC. It’s not required in all states, but it’s a good idea to have one in place to avoid any confusion or conflict down the road.
4. Set Up Your Accounting System
You’ll need a system for tracking your income, expenses, and other financial transactions. There are many different accounting software programs available, so choose one that fits your needs and budget.
5. Obtain Business Licenses and Permits
Depending on your industry and location, you may need to obtain certain business licenses and permits to operate legally. Contact your local government to find out what licenses and permits are required for your business.
6. File Annual Reports
Most states require LLCs to file annual reports with the state corporation commission. These reports typically include information such as the names and addresses of the LLC’s members and managers, and the LLC’s registered agent.
7. Comply with Tax Requirements
LLCs are considered pass-through entities, which means that the business’s profits or losses pass through to the individual members’ tax returns. You’ll need to file individual tax returns to report your share of the LLC’s profits or losses.
8. Get Business Insurance
Business insurance can help protect your LLC from financial losses in the event of a lawsuit, property damage, or other unforeseen events. There are many different types of business insurance available, so talk to an insurance agent to find a policy that meets your needs.
9. Market Your Business
Now that your LLC is up and running, it’s time to start marketing your business and attracting customers. There are many different ways to market your business, so find what works best for you and your budget.
10. Keep Up with the Paperwork
Once your LLC is up and running, it’s important to keep up with the paperwork. This includes filing your annual reports, paying your taxes, and renewing your business licenses and permits.
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