A Limited Liability Corporation (LLC) is a way a business may be organized legally. That is, a business currently running or about to be started may be organized as a LLC. Every business is considered a sole proprietorship until it is organized as something else. Whereas something like sole proprietorship makes no distinction between the business and the owner. By organizing their business as a LLC, the business owner sets themselves and the business apart as separate entities.
What are the Requirements for a LLC?
Louisiana’s requirements for forming a LLC are very accommodating to a new business. Louisiana does not require the business owner to have business partners to organize as a LLC, which allows for single member LLCs. Louisiana does not require the business to be located within the state nor does it require the owner to be a resident or citizen of the state. But the State maintains other requirements:
- Name of the LLC: The desired name of the LLC must be available and contain one of the following: LLC, L.L.C., LC, or Limited Liability Company. The availability of LLC names can be checked through the Louisiana Secretary of State website.
- Choose a registered agent: A registered agent is someone that a business owner designates as someone who can receive legal paperwork on behalf of the business. Most small businesses use an outside company as a registered agent when the business does not reside in the state they are forming in. The fee is usually inexpensive and there are many options available online.
- File Necessary Paperwork with the Secretary of State: Be prepared to pay the necessary filing fee and submit the above information to the Secretary of State.
- EIN: Employer Identification Number is necessary to run the LLC. It is for tax purposes and allows the LLC to open a bank account and hire employees.
What Paperwork Do I need to Form a LLC?
To form a LLC in Louisiana the only required paperwork is the Articles of Organization. The Articles of Organization is a very short form asking very basic questions about the business and identifying the business’s registered agent. It typically includes information like:
- The company’s structure, in this case a LLC;
- Who manages the LLC;
- The date the LLC will begin;
- The duration of the LLC (typically unending unless stated otherwise); and
- The names and signatures of the incorporators.
What Benefits does Louisiana Give to a LLC?
Louisiana affords LLCs the advantage that the owner of the business will not be held personally responsible for the acts and debts of the business. That is, if the business does something wrong or goes into debt, the owner’s personal money may not be taken.
Contrasted with a traditional corporation, Louisiana affords a tax advantage to LLC. The earnings of a traditional corporation are taxed twice, the earnings of a LLC are only taxed once.
What Disadvantages Does Louisiana Give to a LLC?
Once a LLC is formed in Louisiana the business is required to file an annual report with the state. Louisiana has established an online system to make it easy to do so but filing the report includes a processing fee.
Where Can You Find the Right Lawyer?
If you are trying to form a LLC, then a Louisiana business lawyer can help you navigate the LLC formation process and help you form your LLC to your greatest advantage.