If you’re ready to start taking your Florida-based business or side hustle seriously, one of the things you’ll want to do first is form your limited liability corporation, also known as an LLC.
“Bear markets are a great time to start a business,” says Nequosha Anderson, Esq., the owner of Anderson Law Firm in Orlando, Florida. “Some of the great businesses we know, such as Slack and Shopify, were birthed after the dot.com bubble burst.” Since COVID-19, record numbers of new business filings have happened in the United States, and how much money you make (and keep) will depend on more than just revenue.
The legal entity structure of a business is essential because it determines how much tax will be paid, who will be liable if there is litigation, and what sort of succession planning you might need to set up. LLCs can protect your assets as an entrepreneur and create tax benefits.
The steps to setting up a Florida LLC vary from state to state. Using an online tool like LegalZoom can help you ensure you’re taking the right steps in the right order to get things off the ground quickly.
A service like LegalZoom will take care of everything you need to apply for an LLC. If you opt to do it yourself instead, here’s a six-step guide to setting up your LLC in the state of Florida, along with what else you should take into consideration along the way.
Step 1: Choose Your Company Name
Your first step to start an LLC in Florida is to pick a company name you’d like to use for your business. You’ll need to check if that company name is already taken on the Florida Department of State’s website.
Search the name and be sure to include the word “Limited Liability Company,” the abbreviation “LLC,” or the designation “L.L.C.” Including one of these distinctions in the name of your business is a requirement in registering a Florida LLC.
Any LLC Name Must Comply with Florida’s Naming Requirements:
- Your business name must contain the word “Limited Liability Company,” the abbreviation “LLC,” or the designation “L.L.C.”
- If you don’t want “LLC” to be in your business name when promoting it, you’ll also file for a “doing business as” name (DBA) during the registration process.
- Your business name must be different from an existing business in Florida.
- Your business name cannot contain words used to name government agencies (State Department, CIA, FBI, Treasury, et cetera).
- Certain restricted words—such as bank, lawyer, attorney, or credit union – may require additional documentation.
You can find all the naming rules on the Florida Legislature’s website.
Your business name must contain the word “Limited Liability Company,” the abbreviation “LLC,” or the designation “L.L.C.” when registering an LLC in Florida.
Step 2: Decide on a Registered Agent and/or Manager(s)
When you register an LLC in Florida, you’ll need to decide and designate who your company’s registered agent will be. The registered agent:
- Accepts official mail for the business. This includes process papers to notify you of pending lawsuits, tax forms, official government correspondence, and other legal documents.
- Must have their name and address made available to the public so that anyone who needs to contact your company can do so.
- Can be yourself or someone else you trust.
- Must be an individual name. An individual must sign on the entity’s behalf if the registered agent is a business entity.
A business entity cannot serve as its own registered agent in Florida, but you as the owner could act as the registered agent as a person. Many businesses opt to outsource their registered agent to ensure nothing slips through the cracks.
You can also elect to include managers in your LLC filing. Each manager is authorized to manage and control the company, and a manager can open most bank accounts and obtain workers’ compensation exemption.
Step 3: Fill in the Filing Information
Fill out the Florida Limited Liability Company Filing form. This form will ask the following information:
- The effective date: when your LLC is starting or started.
- The LLC name: your business name must include the word “Limited Liability Company,” the abbreviation “LLC,” or the designation “L.L.C.” or your application will be delayed.
- The principal place of business: in Florida, the principal address must be a street address and not a P.O. box.
- The business’s mailing address: this can be the same or different than the principal address.
- The name and address of the registered agent.
- The correspondence name and email address; this is where all correspondence, certified copies, and status certificates pertaining to the filing will be sent.
“One of the biggest mistakes I see is when someone forms an LLC and tries to use a P.O. box as the principal address,” says Rolanda McDuffie, a Tampa-based certified public accountant (CPA). “That’s a huge no-no with the state of Florida because if documentation needs to be sent to your company, there needs to be someone to sign for it.”
Step 4: Prepare and File the Articles of Organization
Review your filing for accuracy. Once you have submitted your information, the filing cannot be updated, removed, canceled, or refunded. When the required information is filled out, you’ll be promoted to a page to make your payment to file the LLC.
Step 5: Get an Employer Identification Number
If your LLC is approved, you will receive an email confirmation telling you your LLC was filed electronically, what date it was filed, and the effective date of the business. The email will assign a document number you refer to whenever corresponding with the Florida Division of Corporations. The email also prompts you to get an EIN (Employer Identification Number) with the IRS.
Step 6: Obtain your Florida Business License (If Required)
LLCs in several industries are required to obtain a Florida business license. Find out whether your industry or profession requires a business license by looking it up here.
How Much Does It Cost to Start an LLC in Florida?
The required filing fee for an LLC in Florida is $100 for the articles of incorporation and $25 for the registered agent designation. Any outside services you use to help you file your LLC, such as LegalZoom or hiring a lawyer, would be an additional cost.
You can also elect to receive additional documents for a fee. One is your certificate of status, which costs five dollars and certifies the Limited Liability Company is in good standing with the state of Florida. Another election is to receive a certified copy of your articles of incorporation for a fee of $30. A certified copy certifies that the articles of the organization are true and correct, and in Florida most banks will require a certified copy to open a bank account.
Is It Worth Starting an LLC?
Starting an LLC can be worth it, depending on the goals of your business, legal and tax considerations, and succession plan.
“It’s worth it to start an LLC because of the tax structure and legal protections,” says Michelle Suarez, a Florida business attorney who’s helped over 200 entrepreneurs set up their business structures. “With an LLC, you get limited liability protection. By forming an LLC, you create a shield between your personal assets, assuming you’re operating a company the way you’re supposed to, as a separate company.”
“An LLC is a bit more flexible than a C Corporation structure,” says Anderson. “You won’t need a board of directors, formal titles, or the mandatory annual meetings. With an LLC, you still get the protection and the separation between your personal and business assets.” She also notes that if a business owner knows their goal is not to go not public or take on a lot of investors, an LLC is often a better option.
Related: LLC or S Corp? The Tax Decision New Business Owners Need to Make
How Long Does It Take to Form an LLC in Florida?
The time to form an LLC in Florida depends on how quickly the state processes your filings. You can elect to register your LLC online or by mail. Choosing the mail-in option takes longer. Online filings can take as little as one to two business days.
The Florida Division of Corporations keeps an updated list of the filings they are currently processing on their website.
Can a Single Person Start a Florida L.L.C.?
Yes. When registering an LLC in Florida, you can elect to form a single-member LLC. You can start an LLC as a single person and still get all the protections of an LLC. The process is the same as forming a multi-member LLC.
Do You Need an EIN to Start an LLC?
You do not need an EIN (Employer Identification Number) to start an LLC, but you do need to obtain one once your LLC is formed.
An LLC is an entity created by the state. An EIN is needed with an LLC for federal income tax purposes with the IRS. An LLC uses an employer identification number for all information for returns and reporting related to income tax.
When your LLC is officially registered in Florida, you get an email stating that a Federal Employer Identification Number (FEI/EIN) will be required when the report is filed.
Starting an LLC in Florida is a fairly straightforward process, and squaring away the paperwork now will help you tremendously down the road as you bring your business or side hustle to life.