How to Form an LLC in South Carolina
Entrepreneurs are starting new businesses thanks to the generous PPP loans and grants. This guide will show you how to create an LLC in South Carolina. Here are some helpful tips and links that will help you complete the process.
If you want to use an LLC service, visit our list of the best LLC services in South Carolina.
Before you create an LLC in South Carolina
Before you can set up your South Carolina LLC, it is important to prepare. This will ensure that your request is successful and save you time and money. Before you register your business entity, here are some things to consider:
- Is your preferred name for an LLC available?
- Who will be your LLC’s registered agents?
- Is there a different set for foreign entities?
Before you move forward, it is important to answer as many questions possible. We did a bit of legwork to help answer the questions above.
Looking for a preferred LLC name?
To ensure that your business name is available for use, it’s a good idea to perform a search before you settle on a name. After you have decided on a brand identity, submit a application in order to reserve a limited-liability company name. Foreign entities that have an existing name are also eligible to use this form. They must use a separate pseudonym.
You will need to submit two copies of your form and pay $25 for the fee. The right to register a business name grants you the right of forming a company using the name. However, it does not grant you exclusive rights to use that name in South Carolina. To register a service mark or state trademark, you will need to file separate paperwork and make the name yours.
It’s a smart idea to research the availability of domain names as well as social media handles that match your chosen LLC name. Your business will be more memorable if you use your business name in all your marketing. Registering a domain now and creating social media accounts will ensure that you have the right social media names and website when you start marketing.
Appoint a Registered Agent
You will need to include a physical address and the name of your registered agent in South Carolina as part of your LLC registration paperwork. The registered agent receives legal correspondence for your company and forwards it on your behalf to your LLC. The agent must be at least 18 years old and a resident of South Carolina.
Either you or your LLC employee can act as agent. Or, you can hire a registered agents service.
You can expect to pay between $50-300 for a registered agent in South Carolina for your LLC. Ask questions and research the services they offer to make sure you are making the right choice for your company.
Setting Up Your South Carolina LLC
After you have completed the steps above, you can move on to forming your LLC. There are many ways to send your Articles of Organization, including multiple methods.
Online submission of documents. Online submissions are encouraged by the Secretary of State’s website. This is because it will be faster and less likely that your request will be rejected. You can save your forms to continue the process later.
Completed forms should be sent to the Secretary for State’s Office. Attn: Corporate Filings, 1205 Pendleton Street, Suite 525, Columbia, SC 29201
Two copies must be submitted when you complete physical documents. Make your check payable to the South Carolina Secretary Of State. Include a stamped, self-addressed return envelope.
Foreign entities will need to fill out a different form: the Application For a Certificate Of Authority To Transact Businesses. South Carolina charges $110 for both domestic and international entities.
What to do after setting up an LLC
After you have registered your LLC in South Carolina, you will need to take other important actions for the long-term and short term.
Register for an Employer Identification Number (EIN).
A majority of businesses have to obtain an EIN. It is sometimes called a Federal Tax Identification Number or Federal Employer Identification Number. If you are a sole proprietorship, your Social Security Number (SSN) can be used. An EIN may be more convenient to keep your SSN secure. EINs can be easily obtained from the official IRS website.
Examine for changes to annual requirements
South Carolina doesn’t require LLCs to file annual reports as of this article. However, South Carolina may change its requirements regarding LLCs from time to time.
Make an LLC Operating Agreement
Operating agreements are crucial for establishing the foundation for your LLC’s operation. Operating agreements include essential details such as member contributions, day-to-day operations and who manages the LLC. Although not necessary, an LLC operating agreement can be a great way to establish the ground rules for your company. This agreement is a great way for business partners to avoid potential disputes that could escalate into major legal issues.
An LLC operating agreement is often necessary to give your business legitimacy.
The South Carolina Secretary of State’s website provides valuable information regarding the registration process as well as any additional obligations. Send a message via the website form, or call (803) 734-6217 if you have any other questions.
Most Frequently Asked Questions
What is an LLC?
A limited liability company combines the flexibility and ease of a sole proprietorship or partnership structure with the greater risk protection offered by a corporate structure. LLC owners, also known as “members”, have limited liability. This means that their personal liability to the company is limited to what they have invested. It does not cover losses or debts beyond that amount.
Members of an LLC are subject to taxes by default. This is the same as for owners of a general partnership or sole proprietorship. This structure is commonly referred as a “pass through” tax structure. If the LLC meets certain criteria, it can choose to be taxed either as a C-corp (C-corp) or as an S-corp (S-corp). Small business owners prefer LLCs because of their simplicity and flexibility.
What is the cost of setting up an LLC in South Carolina?
Establishing a South Carolina LLC costs $110. Foreign LLCs must pay the same fee for a certificate of authority to transact in South Carolina.
What is the average time it takes to get an LLC approved for South Carolina?
Online filings are quicker than paper filings and can be approved within the same day or the next business day.
Is South Carolina taxing LLCs?
South Carolina doesn’t impose a franchise fee on its businesses, unlike some other states. LLCs are generally taxed as “pass-through business entities” and are therefore not subject to corporate taxes (unless they elect to be taxed under C-corporation). LLC owners are subject to tax on their business profits in addition to personal income tax filings.
Brian Wilson is the content manager and founder of LLC Radar.
Brian grew up in North Texas, just outside of Dallas, and has a bachelor’s degree in business journalism from Southern Methodist University. Since graduating from SMU, Brian has gained over 10 years of experience in business writing for several online publications.
Brian resides in Plano, Texas and he can be reached at firstname.lastname@example.org
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