How To Form an LLC in Georgia
If you’re thinking of starting a business in Georgia, you may be thinking about how to form an LLC. This guide will walk you through the process step by step. We’ll cover everything from registering with the state to naming your company. So whether you’re just doing research or you’re ready to take the plunge, keep reading for all the info you need!
What is an LLC?
The Limited Liability Company (LLC) is a popular entity structure for businesses starting in Georgia. The LLC provides personal liability protection and has the potential to save money on taxes. While it can be intimidating to form an LLC for the first time, with a little research and patience, you can learn how to form an LLC in Georgia without an attorney.
Unlike a sole proprietorship or partnership, where the small business owner can be held personally liable for lawsuits against the business, the LLC is a separate legal structure that protects the business owner’s personal assets should the business be sued
Besides the liability protection, the Limited Liability Company provides several other benefits over the sole proprietorship, partnership, and corporation because of the multiple tax options, ease of administration, and management flexibility.
Related: Guide to starting a business in Georgia
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Steps to Form a Georgia LLC
Let’s break down the steps to complete the Georgia LLC formation process.
Step 1: Choose an LLC Name
The first step in forming a Georgia Limited Liability Company is to make sure the name you want is available. LLC names have to differ from other registered entity names in the state of Georgia. While name registration isn’t required before filing for an LLC, it’s best to check on available LLC names in Georgia.
In addition, there are a few name restrictions to be aware of. These include:
1. The legal name of the LLC must include one of the following at the end of the business name:
– Limited Liability Company
– Limited Liability Co.
– Ltd. Liability Company
– Ltd. Liability Co.
– Limited Company
– Limited Co.
– Ltd. Company
– Ltd. Co.
– LLC
– L.L.C.
– L.C.
– LC
2. Certain words are not allowed to be used in the name of an LLC without prior approval. Some of these words include bank, credit union, insurance, assurance, indemnity, surety, fidelity, reassurance, reinsurance, college, or university.
3. The length of the name can’t exceed 80 characters, including spaces and punctuation.
If there is a name you want to use but are not ready to form the LLC, a name may be reserved by submitting a Name Reservation Request form and paying a fee of $25. The name reservation will hold the name for 30 days.
If you plan to use a different company name from the one that you register (perhaps you want to run multiple businesses under the LLC), you can use a trade name (sometimes referred to as a fictitious business name, assumed name, DBA, or Doing Business As name). To register a fictitious name, a Registration Statement will need to be filed with the Clerk of the Superior Court in the county where the LLC operates out from.
You may also want to see if a domain name is also available to have a matching website address.
Step 2: Appoint a Georgia Registered Agent
Every LLC in Georgia is required to have a Registered Agent. A Registered Agent will act as a central point of contact to receive legal documents, tax notices, summons, subpoenas, etc., on behalf of the LLC.
The requirements to be a Georgia Registered Agent include either being a Georgia resident at least 18 years old or a corporate agent registered with the state of Georgia. The agent must also generally be available during normal business hours and have a physical address in the state.
Any individual meeting the requirements can be the agent; however, the agent’s name and address becomes public record, and with that comes a loss of privacy. This is more important for some entrepreneurs, especially when doing business from home or still employed. Hiring a commercial Registered Agent service like Northwest Registered Agent will help keep the owner’s names from being publicly listed.
Learn about the requirements of a registered agent in Georgia.
Step 3: File the Georgia Articles of Organization
The paperwork to create an LLC in Georgia is called the Articles of Organization. To file, either create a user account with the Georgia Secretary of State, Corporations Division, and register the LLC or download and mail the Georgia LLC Articles of Organization (Form CD030) and the Transmittal Form (Form 231).
Related: How to fill out the Georgia Articles of Organization
If mailing, send the form and a check or money order payable to:
Georgia Secretary of State, Corporations Division
2 Martin Luther King Jr. Dr. SE
Suite 313, West Tower
Atlanta, GA 30334
If you have questions, contact the Georgia Secretary of State, Corporations Division, at 404-565-2817 or
http://sos.ga.gov/index.php/corporations
When filling out the Articles of Organization, there are a few sections that can be difficult to answer when seeing them for the first time. Let’s go over a few of those sections.
Business Purpose – This section is used to classify the industry or primary business activity. If you choose to list your business industry, select a NAICS Code that matches the closest to what the business will do from the drop-down menu.
The NAICS (North American Industry Classification System) code is a six-digit number that classifies and categorizes different businesses. This information is used in reporting statistical data for each of the industries in the U.S. Remember this number, as you will need it when filing annual tax returns. You can learn more about the NAICS number here.
If your business activities aren’t specifically listed but you want to answer, select the industry that is the closest or “Any Legal Purpose.”
Principal Office – In this section, enter the street address, city, state, zip code, and country of the initial principal office. This address can be the LLC’s physical address, the address where the business records are kept, or the address of the Registered Agent. You may not use a PO Box for the principal office.
Effective Date – The next area asks about the effective date of the LLC. By default, the LLC is effective on the date submitted. If you prefer the LLC to officially start at a later date (up to 90 days), enter that date in this field.
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What To Do After Starting A Georgia LLC
Once the LLC has been formed, there are a few additional steps to take care of. Below is a list of the most common tasks.
Prepare a Georgia LLC Operating Agreement
The operating agreement is a document that governs the framework of an LLC. This document covers items like ownership rights, member (LLC owner) responsibilities, how profits and losses are distributed, and more.
Most states do not require an LLC to have an operating agreement, but it is still worth considering. Without an operating agreement:
- The LLC could be subject to generic state rules that may be detrimental in the event of a lawsuit.
- Member’s personal liability protection may be diminished.
- LLC members may not fully understand their roles and responsibilities, which could lead to costly disputes in the future.
Related: Georgia operating agreement template
Obtain an EIN
If the LLC will hire employees or is owned by more than one member, an EIN is required.
The EIN or Employer Identification Number (also referred to as a Federal Employer Identification Number, FEIN, or Federal Tax ID Number) is a unique 9-digit tax identification number assigned to a business by the Internal Revenue Service (IRS). Similar to a social security number for an individual, the EIN identifies business entities for tax purposes. The EIN will be needed to hire employees, open a bank account, build business credit, register for business licenses and permits, file federal and state taxes, and more.
There is no cost for the EIN when registering through the IRS. The number is available immediately when applying through the IRS website; however, you can also register by phone, fax, or mailing IRS Form SS-4.
If an Employer Identification Number isn’t required, the LLC can either use the owner’s social security number or register for an EIN.
Related: How to Apply for an EIN
Open an LLC Bank Account
Opening a bank account for your LLC is important for liability protection as the account separates the business’s funds from the member’s personal funds.
Several documents will be needed to open a business bank account, such as:
- A banking resolution is a document that authorizes the members to open a business bank account on behalf of the LLC.
- Copies of the certificate of organization paperwork from the state showing the creation of the LLC (or Certificate of Authority if a foreign LLC).
- Driver’s licenses of the members.
- Depending on the LLC’s age, a Georgia Certificate of Good Standing may be needed to prove the LLC is active and in good standing with the state.
Related: How to Open a Business Bank Account for your LLC
Apply for Business Licenses and Permits
Depending on what your business does and where it is located, there will likely be various business licenses and permits needed. Some common registrations include:
- Business License – Some cities require businesses to obtain licensing before they can start.
- Professional License – Certain services such as barbershops, accountants, salons, and others must be licensed.
- Sales Tax Permit – To sell products and certain services, registration with the Georgia Department of Revenue will be necessary.
Related: What Business Licenses are Needed in Georgia?
File the Annual Registration
LLCs are required to file an annual registration with the Georgia Secretary of State, Corporations Division. The cost for this is $50 each year, and will be due between January 1st and April 1st of the year following the formation of the LLC. The annual report updates ownership information and other details.
Related: How to File a Georgia LLC Annual Registration
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Georgia LLC FAQs
How much does it cost to start an LLC in Georgia?
The Georgia Secretary of State’s filing fee for an online filing is $100, while forms sent by mail will cost slightly more.
Is there an annual fee for an LLC in Georgia?
Each year LLCs will need to file the Annual Report and pay the $50 annual report fee.
How long does an LLC take to process in Georgia?
It normally takes 7-10 business days for an LLC to be approved in Georgia for online filings and 2-3 weeks for mailed-in filings, though for an additional fee, expedited processing is available.
Where do you check if your Georgia LLC name is available?
Find available Georgia LLC names by searching the Georgia Secretary of State name database.
Do you need a Registered Agent for your LLC in Georgia?
Every LLC in Georgia must have a Registered Agent under Georgia law.
Anyone can act as a Registered Agent, provided they are at least 18 years old, reside in the state, and are generally available to receive documents during normal business hours.
Related: What are the requirements of a Registered Agent in Georgia?
Do you need a business license if you have an LLC in Georgia?
Most businesses in Georgia will need to register with a variety of government agencies. Georgia business license requirements are based on what the business does or where it is located in the state, not on the type of entity.
It’s sometimes thought that the LLC and business license are the same in Georgia, but they aren’t. An LLC is referred to as the business entity, which is how the business is organized to conduct business. A business license is an approval from a government entity to operate legally.
What is a Foreign Limited Liability Company?
An LLC that is physically operating in states outside of where it was formed. Physically operating means having a presence, such as having an office or employee. The LLC will need to register as a foreign LLC in each state where it plans to operate.
Related: What is a foreign LLC?
What is a Professional Limited Liability Company?
Businesses that require state licensing, such as accountants, attorneys, podiatrists, physical therapists, acupuncturists, etc., often must file as a Professional Limited Liability Company (sometimes referred to as a Professional LLC or PLLC) instead of an LLC. Filing for a PLLC is very similar to that of an LLC.
Is an LLC the same as a corporation?
The LLC is one of four main types of business entities. You can learn more about each here:
What is a sole proprietorship?
What is a general partnership?
How to form a Georgia corporation
2 Responses
When a member of a Georgia simple LLC( non S or C corp) wants to leave the LLC, is there a specific form that needs to be filed with the SOS corporations division or does it only have to be documented and handled through the LLCs operations agreement and documents on the LLCs corporate records.
As I understand it (I’m not an attorney, so you should verify), but unless it’s otherwise stated in your operating agreement, a member can withdraw from an LLC by giving a written notice at least 30 days in advance of leaving. https://law.justia.com/codes/georgia/2010/title-14/chapter-11/article-6/14-11-601.
Since members aren’t required to be listed with the Secretary of State, I don’t believe there is a form that has to be filed.
I hope this helps!
Greg