- Step 1. Naming Your North Carolina LLC
- Step 2. Choosing a Registered Agent
- Step 3. File Your Articles of Organization
- Step 4. Create an Operating Agreement
- Step 5. Get an EIN/Tax ID Number
- Step 6. Keeping Your LLC Running
- North Carolina LLC Resources
- New York LLC FAQs
Step 1. Naming Your North Carolina LLC
The first step in setting up your LLC is choosing a name that is unique to your business and adheres to the naming regulations defined by the state of North Carolina.
Legally Required Designation
In accordance with North Carolina LLC regulations, your LLC name must contain either the phrase “limited liability company” or one of the abbreviations below:
- Liability Co.
- Limited Liability Co.
The name that you choose for your LLC must be different and distinguishable from all other businesses in the state. You can run a search through the database on the North Carolina Secretary of State’s website to see which names are available for use.
If you want to reserve an LLC name ahead of time, you can fill out the Application to Reserve a Business Entity Name. This form must be mailed in along with a $30 filing fee, and will reserve your desired LLC name for up to 120 days before establishment.
You may also want to perform an available domain name search while you are looking for an LLC name. Even if you don’t plan on setting up your business website immediately, it can be a good idea to go ahead and reserve the domain name to save future hassle.
When choosing an LLC name, you are not allowed to include any words that run the risk of confusing your business with a government entity. This can include words like “FBI,” “Treasury,” “IRS,” or “State Department.”
Additionally, using words such as “bank,” “attorney,” or “chiropractor” may require the presence of a properly licensed individual in your LLC, as well as the filing of additional paperwork. You can check with the North Carolina Secretary of State’s office for more information on this.
Using an Assumed Name
In North Carolina, you are allowed to conduct business under a name that is different from your LLC’s officially-registered name. This is referred to as an assumed, or DBA (doing business as), name.
If you would like to register a DBA name for your business, you will need to file an Assumed Business Name Certificate with your county’s Register of Deeds. You can use this search portal to locate the county your LLC is in and check out local requirements. The certificate costs $26 to file and must be sent in by mail.
Step 2. Choosing a Registered Agent
Every LLC established in North Carolina must appoint a registered agent. The registered agent can be an individual or a business entity, and they will be responsible for receiving all legal documents, government communications, and necessary tax documents, acting as a contact point between your LLC and federal agencies or the state of North Carolina.
You can appoint either yourself, any member of your LLC, or a registered agent service that is authorized to conduct business in North Carolina as a registered agent. As long as your registered agent has a valid North Carolina street address and is available during regular business hours, they are eligible to be your registered agent.
Step 3. File Your Articles of Organization
After you have selected a name for your LLC and appointed a registered agent, you will need to complete and file your Articles of Organization (Form L-01). This document gives all the necessary information about your LLC that is needed for the state to legally establish it. Below, you can find some of the information that will need to be included in the form.
- Your LLC’s name
- The names and addresses of every person signing the Articles
- Your LLC’s registered agent’s name and address
- The address and contact number of your LLC’s principal office
- Your Articles’ effective date, if not immediate
- The signature of either an LLC member, the organizer, or an LLC representative
There is a $125 fee associated with filing the form, and you have the option of filing it online, in-person, or through the mail. You may also need to pay extra fees if you want to expedite the processing of the document.
To file your Articles of Organization online, make an account on the online business portal through the North Carolina Secretary of State’s website. From there, you can fill out all the necessary information and then pay the filing fee with a credit or debit card upon submittal. There may be a small additional fee for credit card processing.
If you want to file your Articles of Organization by mail, print out and fill in the form. Place it into an envelope along with a check for $125 made payable to the North Carolina Secretary of State. Then, mail it to the address below.
The Secretary of State
Business Registration Division
P.O. Box 29622
Raleigh, NC 27626
You also have the option of filing your Articles of Organization in person. To do this, print out and complete the form and then proceed to the address below with a valid form of payment for the $125 filing fee.
Business Registration Division
2 South Salisbury Street
Raleigh, NC 27601
Step 4. Create an Operating Agreement
North Carolina does not require you to submit an operating agreement, but you may want to consider creating one for your LLC anyway. This document sets clear guidelines for how exactly your LLC is managed, the rights that members or managers have, and what to do in the case that your LLC dissolves or experiences a lawsuit.
If you do not create an operating agreement for your LLC, North Carolina and federal laws will dictate how your LLC is treated in the event of a dissolution, conflict, or lawsuit. This is often not in your best interests.
You will most likely need an operating agreement on hand to open business bank accounts or receive funding from lenders, and the agreement can help to establish your LLC as a separately operating business entity.
You may want to give copies of your LLC operating agreement out to members or managers to ensure all participants are kept up to date with how your business is run.
Step 5. Get an EIN/Tax ID Number
You will need to apply for a Tax ID number, also known as an EIN (Employer Identification Number), through the IRS after your Articles of Organization have been processed and your LLC has been legally established.
The EIN is required for any LLC that has more than one member or for any single-member LLC that wants to hire employees or chooses to be taxed as a corporation.
You will use your EIN to identify your business to the IRS on all tax documents and necessary government filings. The number acts much like a social security number for your LLC. If you want to hire employees, file federal taxes, open business bank or credit accounts, or apply for business funding, you will need an EIN.
It is free to apply for your EIN with the IRS, and you can file the application online or by mailing it in. Keep in mind that if you are a foreign filer or do not have a social security number, you will need to file for your EIN through the mail.
The quickest and easiest way to apply for your EIN is online. You will receive your number once your application is complete, and the application takes less than 15 minutes. Visit the IRS website to apply for your EIN for free.
You will need to fill out this form when applying for your LLC by mail. If you are a foreign filer or do not have a social security number, leave section 7b blank. Mail the completed form to the address below. You can follow up on any questions with the IRS at (267) 941-1099.
Internal Revenue Service
Attn: EIN Operation
Cincinnati, OH 45999
Step 6. Keeping Your LLC Running
After your LLC is established, there are regular milestones and checkpoints that you need to meet to ensure it stays running smoothly.
Pay Annual Registration Fees
Every LLC in North Carolina must file an annual report and pay annual registration fees. The report is due on April 15th each year, regardless of when your LLC was established. For example, if your LLC was established in January of 2020, you would need to file a report by April 15th of the same year.
Separate Your Business Finances
A business credit or debit account can help keep your LLC’s finances separate from any personal ones, establishing the LLC as an independently operating business. It is not required by North Carolina that your LLC has one, but it may be a good idea to establish one anyway, especially if you want to protect your personal assets from a lawsuit.
Compare all of your options before making a choice on which bank account to open, as different banks will have different minimum required balances or credit spending limits; you want to be sure that you select something that is the best for your LLC’s needs.
To open a bank account for your business, you will most likely need to show your Articles of Organization, Operating Agreement, EIN, and possibly other LLC documents. You can call ahead and check with the bank which documents are needed before showing up to open your account.
Keep up With Federal and State Taxes
You need to make sure to keep up with any federal and state taxation requirements to guarantee that your LLC stays running legally.
Federal Tax Requirements
There are several different tax structures you can choose from to use in your LLC that may meet different company needs; each tax structure comes with its own unique type of federal taxation. This article can help you gain an in-depth understanding of the differences between each type and help you decide which is best for you.
In general, most LLCs are taxed as sole proprietorships or partnerships. This means that you will be expected to file Schedule C along with your individual income tax return to declare any income that you receive through your LLC.
When using this tax structure, you should keep in mind that you will most likely need to pay self-employment tax (which has a rate of 15.3%), in addition to any income tax. You may also need to make quarterly estimated tax payments to avoid any IRS fines; the IRS website gives more details on this.
If you want, you can choose to have your LLC taxed as a corporation, like an S Corporation or a C Corporation. You will need to fill out IRS Form 8832 and IRS Form 2553 to declare this. After these forms have been processed, your LLC will be taxed as a corporation and expected to file a separate corporate tax return with the IRS.
North Carolina State Business Taxes
North Carolina does not have a separate state business tax on LLCs that are taxed as sole proprietorships or partnerships. If you elect to have your LLC taxed as a corporation, however, you may be required to pay an additional 5 percent flat corporate tax on your income and a corporate franchise tax.
You can read more about corporate taxing requirements on the North Carolina Department of Revenue website.
North Carolina Sales Taxes
If your LLC will be selling goods or services, you will need to collect tax and then pay sales and use taxes to the state’s Department of Revenue. You can register to pay this tax online, after which you will receive a Certificate of Registration.
You will need to pay these taxes on a periodic basis, and filing for the taxes can also be completed through the North Carolina Department of Revenue website.
State Employer Taxes
If your LLC has or is planning to hire employees, you will be required to pay additional withholding and unemployment insurance taxes. You can register and file your withholding taxes online with the state’s Department of Revenue, and register and file for unemployment taxes with the North Carolina Department of Commerce, Employment Security Division.
Both of these websites will also give you more information about how much money to withhold from employee wages, how to calculate payments, and when exactly you should be making your payments.
Acquire Necessary Permits and Licenses
While there is no statewide business license requirement for North Carolina LLCs, you may find that you need to acquire a county or city permit or license. This may also change based on the type of services you are offering and if you need a professional license for your LLC (like an attorney or acupuncturist would).
You can check with the North Carolina Business Link to figure out which permits and licenses may be required for your LLC. The Business Link will also provide free business assistance services as you set up and start running your LLC, which can be a helpful resource if you have any confusion over the structural and tax requirements of your business.
Additionally, you may be required to obtain certain permits and licenses for your LLC on a federal level. Whether this is needed depends mostly on the type of business you are running and the services you are offering. For help determining if you need to meet additional federal licensure requirements, you can use the directory on the US Small Business Administration’s website.
North Carolina LLC Resources
This list of resources can help guide you through every step of setting up your LLC and keeping it running legally.
- Available LLC name search
- Available domain name search
- Application to reserve an LLC name
- Apply for a DBA name
- County Register of Deeds online search
- Articles of Organization
- Articles of Organization online filing
- IRS EIN free application
- Annual Report online file
- North Carolina Department of Revenue
- North Carolina Department of Commerce
- Business Link North Carolina
- S. Small Business Administration
New York LLC FAQs
The answers to these frequently asked questions can help clarify any worries you may have about establishing your LLC in New York.
In New York, it costs $200 to file your Articles of Organization with the Department of State and $20 to reserve an LLC name ahead of time. You will also need to pay applicable fees for your newspaper notice of publication and for filing the Certificate of Publication, which carries a $50 filing fee.
The cheapest way to start an LLC in New York is to file your Articles of Organization without paying to reserve an LLC name ahead of time or registering a DBA name. Doing it this way will only cost you $200, plus publication fees and your $50 Certificate of Publication filing fee.
How much your New York LLC pays in taxes depends on the individual tax structure that you have set up for your business. You may also need to pay applicable state taxes, including LLC annual filing fees, corporation taxes, state employer taxes, or sales and use taxes.
In New York, your LLC will need to file reports biennially. The report will be due every two years during the anniversary month of your LLC’s establishment, must be filed online, and carries a $9 filing fee.
If you are finished conducting business under your LLC, you will need to file Articles of Dissolution with the New York Department of State, in addition to notifying the Department of Taxation and Finance. There is a $60 fee for filing the Articles of Dissolution.
You will also need to consult your operating agreement and follow the terms that your LLC previously developed for closing down operations and tying off any loose ends related to your LLC’s business.