Business owners have a lot of options in deciding how to legally organize their company, including a corporation, a limited liability partnership (LLP), and a limited liability company (LLC). An LLP is a popular choice among business structures because it has the benefit of allowing all of the owners, known as partners, to have a leadership role in the company while still protecting their assets. This is because all of the partners have limited liability, but still share equal control of the LLP. If your company wants to transact business as an LLP in South Carolina, it will need to register as an LLP with the South Carolina Secretary of State.
What Are the Requirements for an LLP?South Carolina’s Uniform Partnership Act has set forth requirements that must be met by any company wanting to register as such in the state. One such requirement is placing either “Registered Limited Liability Partnership” or “L.L.P.” at the end of the LLP’s name. You are also required to establish a registered office and find a registered agent who will consent to receive service of process on behalf of the LLP. The registered agent must either be a South Carolina resident or corporation registered to do business in the state that is located at the registered office. Every LLP must file specific paperwork with the Office of the South Carolina Secretary of State. All LLPs must also either obtain $100,000 of liability insurance or set aside funds to cover the LLP’s liability.
What Paperwork Do I Need to Form an LLP?As previously mentioned, one must register their LLP with the South Carolina Secretary of State by filing the correct paperwork, which must be sent in duplicate to the Office of the South Carolina Secretary of State through the mail. An LLP that is forming as an LLP solely under the laws of South Carolina, known as a domestic LLP, is obligated to fill out an Application for Registration of a Limited Liability Partnership. In order to complete this form, you are required to give the LLP’s name, a statement describing the LLP’s line of work, the address of the LLP’s registered office, the registered agent’s name, the number of partners in the LLP, and the address of the LLP’s principal office if the principal office is located outside of the state. You must also indicate that the form is the LLP’s original application, and not a renewal. Also, the form will need to be signed by both the registered agent and the partner that is either in possession of a majority interest in the company or authorized by the partners who possess a majority interest of the company.
An LLP that was formed under the laws for another jurisdiction, known as a foreign LLP, needs to complete an Application for a Certificate of Authority to Transact Business in South Carolina by a Limited Liability Partnership and send it in with a Certificate of Existence. You must indicate on the application for that it is the LLP’s original application, as opposed to a renewal. Additionally, the application requires you to disclose the name of the LLP, the original location and date of the LLP’s creation, the address of the LLP’s registered office, and the name of the LLP’s registered agent. It must also contain the signatures of the registered agent and the partner(s) with a majority in interest or a partner authorized to sign it.
What Benefits Does South Carolina Give to an LLP?
South Carolina does provide a number of incentives and grants to businesses in the state. For example, any company that revitalizes a retail space may be able to receive tax credits for real property taxes, as well as credits for income or license taxes.
What Disadvantages Does South Carolina Give to an LLP?
Every LLP must file the same registration form every year to renew its registration. The Department of Revenue will charge a 5% penalty for every month the renewal is late. If you do not renew your LLP, you also risk having it dissolved.
Should I Hire a Business Lawyer?
The right lawyer can make all the difference in such an important decision such as creating an LLP. Thus, it is in your best interest to reach out to a South Carolina business lawyer who can guide you through the process.