Starting LLC in Georgia: Peculiarities & Detailed Manual
Want to start an LLC in Georgia? It is a profitable decision for a business, as the state has waived corporate tax in favor of gross corporate income tax. So you’ve decided to start an LLC? Not sure how to initiate the process? To start an LLC in Georgia, you need to get ready for several stages.
We’ve prepared a guide for you with just six steps to form your LLC and to get success! You can also refer to the virtual LLC formation service.
Note: ZenBusiness is the best service to file the LLC. You’ll surely appreciate reasonable prices, company values, and other peculiarities.
An Georgia LLC: The Notion & Essence
Many Georgia business owners choose to start an LLC. So, unlike a corporation, they can take advantage of flexible management. We’re talking about the protection of personal assets that sole proprietorships and general partnerships lack.
The state of Georgia puts forward simplified requirements for registration and maintenance of LLC and invites business owners to choose the type of taxation. Do you still have doubts about the LLC?
6 Stages to Form an LLC Correctly
Stage №1: Choose Your LLC Name
The LLC name is a significant aspect, as it is the name of your company that makes the first and strongest impression on the audience of your potential customers! The name must be different from existing company names and must meet Georgia’s regulatory requirements. Now get started with the following aspects.
LLC name in terms of jurisdiction
The State of Georgia obliges business owners to include the abbreviation DDS or the phrase – limited liability company in the name. Please note that the terms corporation or registered are prohibited. In addition, you cannot use the designations of other forms of business: banks or law firms.
Take care of the explanations
You must include in the title an explanation of the nature of your business. For example, if you are engaged in the computers’ repairing, write in the LLC title – computer wizard. If you have any values or principles, also indicate this. For example, if you are farming, use the term natural, nitrate-free, etc.
So, you need to get a little creative and fully comply with Georgia’s legal requirements.
Stage №2: Hire a Registered Agent
A registered agent is called a statutory agent in Georgia and will help you to start an LLC. The agent can be an Georgia resident, natural or legal attorney responsible for sending and receiving legal documentation on behalf of the future company. A company representative can also be an employee of the company or its owner.
According to state laws of Georgia, all LLCs here must designate a registered agent so that the latter has the right to receive and then forward to you whatever the state government corresponds to your business.
The Secretary of State of Georgia addresses such a registered agent as a “mailbox” for an LLC since the corporation entitles him/her as a competent person to get any official communication from the government and then issue it to the full-fledged owner of the corporation. This “mailbox” can be the company’s shareholder, officer, or the owner himself. Normally, LLCs designate attorneys or professional service companies for the task. Mind that the registered agent’s address must be mandatorily local, Georgian, so his residence.
A registered agent guarantees an excellent reputation for your Georgia LLC. Also, if your business gets worse, Georgia can take legal action against it without notifying you. The registered agent will always receive appropriate notification and will be able to take timely measures to protect your interests as an attorney.
You should apply to the online service to get started a business in compliance with all regulations and requirements. So, you will have the opportunity to filter spam and protect your personal and contact information. If you use the ZenBusiness and Northwest Registered Agent to form an LLC, you will receive the free services of a registered agent.
Stage №3: Applying for Registration
To register a business in Georgia, you must file the Articles of Association with the Georgia State Secretariat. If you are anxious about your LLC formation, you can submit your documents for pre-processing, which will allow the Secretary of State’s office to advise you of the eligibility. It can be a good option if you get started for the first time in an LLC without consulting an attorney. Be sure to provide:
- The desired name of your business.
- Personal and contact details of the registered agent.
- Business management form.
- Personal and contact details of the manager of your company.
- Signature of the applicant and registered agent.
- Date of application submission.
Prices: To form an LLC in Georgia, be aware you must pay the respective charge worth $100.
The time for processing: Generally, the state requires 12 working days before they process the paperwork to form your LLC in Georgia. The estimation of this term starts only when all the necessary paperwork is submitted and the application is filled up accurately.
Nevertheless, if you want to speed up the process, a $100 fee arises. Paying it, you get the job done as quickly as in two days.
Stage №4: The Operating Agreement Background
While an operating agreement is not binding in Georgia, creating one could significantly improve the company’s climate. An operating agreement is a document that describes the structure of a project, the way it works, the rights and obligations of each partner.
This document reflects the consistency of partners and thereby reduces the chance of controversy and disputes. Therefore, it is significant that all members of the future LLC carefully read this document before joining the company.
An attorney can help draw up an operating agreement and determine the way income and liabilities will be distributed among the owners of your LLC. You will find more information about the operating agreement here. Prepare to enter the following information:
- Names of all participants.
- The rights and obligations of each of the listed participants.
- Description of procedures for voting or resolving differences between members.
- Regulations on the financial share of participation of LLC members.
- Description of the way you’re going to manage the LLC.
So, do not neglect this stage of LLC formation. It largely guarantees your safety and the observance of your rights by all members of the business project.
Stage №5: Tax Compliance
To conduct a business that you want to register as an LLC successfully, you need to comply with several tax requirements at various levels.
Requirements of Federal Significance
Does your LLC involve multiple owners? Then you need to take care of the EIN! The EIN, or Employer Identification Number, is a unique nine-digit number assigned by the IRS to US corporations. This number must be obtained by all business owners under whose leadership the hired employees work. A business owner can obtain an EIN from the IRS in person or by mail.
Your state’s cess requirements
All corporations in the states and Georgia, as well, are expected to pay respective taxes. Which ones must be levied, depend on the nature of the LLC. And yet, the most significant tax to pay mandatorily is the income tax.
You can pay it on your tax returns if your business is a partnership or a sole proprietorship. Otherwise, corporations are supposed to pay corporate income taxes. To get detailed information on this crucial tax form, visit here.
Sales and use taxes for retailing businesses in Georgia are must be paid, too. Find out how to complete the form, what are the deadlines and tax rates here.
Once you start employing workers for your LLC, you are supposed to pay withholding taxes.
The tax must be withheld from your employees’ paychecks and then paid straight to the state of Georgia. The 2019 Employer’s Tax Guide contains all the necessary information about withholding taxes, so check it out.
These were the basic mandatory taxes for any LLC forming and operating in the state of Georgia. However, there might be others applicable to your business. For instance, you might be expected to pay alcohol, tobacco, or fuel taxes.
Find all tax resources of the state here. Browse the page to spot which of them you can’t miss. To keep all your taxes in neat order and not to fail to pay them punctually, use the Georgia Tax Center.
Local Tax Business Demands
Depending on the town or county of Georgia you register your LLC in, it is subject to local taxes, too. Find out which taxes apply to your corporation using the sales tax distribution search.
In all cases, property taxes will appear mandatory for an LLC in Georgia. Get more information on this here and never overlook tax payments. Otherwise, you will become subject to a lawsuit.
Stage №6: Getting Business Licenses & Permits
There isn’t any single business license for all LLCs in Georgia. And yet, some occupations, including aviation, agriculture, etc., are required to get licensed by the federal government. To get a better image of which federally-regulated industries are subject to licensure, consult the SBAs listings.
Some counties and towns in Georgia demand permits and licenses for corporations in several niches. They may range from dietetics to boxing. To check out the whole list and see if any permit or license applies to your business, access the database of occupational permits and licenses of Georgia. This link will provide you with more data on the county-level licensure.
Other Stages for Business Owners After LLC Registration
After completing the six mandatory steps towards starting an LLC, you need to take care of the following.
Opening a business bank account
Separate your personal and LLC accounts. Thus, you will be sure of the safety of your personal and financial data. Besides, you won’t have any hassle when filing your charge returns. Your EIN will help you open a business account quickly, no matter what you choose a bank or credit union.
All owners of companies/corporations, regardless of their form of management that attracts employees, must go through the compensation insurance procedure. All basic and detailed information is available with the Georgia Bureau of Workers’ Compensation.
This policy aims to protect the rights of workers who are injured at work and unable to work. It will not be superfluous to get a civil liability insurance policy, as well as pay attention to some other types of insurance.
Every LLC is required to submit income reporting. They must state how much the company has earned during the year. Even if your business went wrong during the year and you lost rather than profited, it must be included in the report and submitted.
The state of Georgia suggests several tax forms to all LLCs operating on its territory. Depending on how your business is set up, you must choose a respective one and complete it on the due date. Partnerships must prepare Form 700, sole proprietorships must file Form 500, while corporations are to fill out Form 8453S.
Referring to the services of a qualified accountant
Unlike all other states, Georgia requires no annual reports from its LLCs. Instead, every year an LLC must get a new registration. The latter can be completed both online and in PDF to mail to the State Secretary. Both variants come with a $50 fee. Not to lose time, start the registration here.