Free Guide to Start an LLC in Florida
Starting a business in Florida can be an exciting time. Before selling your product or service though, the nuts and bolts of licenses, registrations, and taxes must be completed.
The guide below will show you the DIY process of forming an LLC in Florida. However, you can also use an online LLC service handle the paperwork for you. We reviewed and ranked the 7 best available.
The Top 2 Worth Considering:
- Northwest Registered Agent is a great option if you are looking for premium customer support.
- IncFile is ideal if you are looking for the best pricing with excellent features.
Step 1: Name Your LLC
Selecting a name for your Florida LLC is a first step, yet a very important one. A name that is unique and easy to remember is helpful in finding potential clients or retaining customers.
The name should indicate the product or service. It should also follow guidelines set forth by the state of Florida.
The name of an LLC will likely appear on business cards and stationary, marketing materials, a website, legal contracts, business bank accounts, invoices and/or a building directory.
Florida requires that the business name includes the words, “Limited Liability Company,” “LLC,” or “L.L.C.” It must be different than other names already registered. Distinguishing features might include the following:
- A key word is different.
- The same keywords are used but not in the same order or with a unique spelling.
The following are not considered distinguishable features:
- Suffixes such as LLC or L.L.C.
- Interchanging “and” with “&”
- Singular, plural, and possessives
- Punctuation and symbols
Let’s imagine that someone is considering opening a flower shop in Tampa Bay, Florida. The name she is considering, Flowers by Fanny, LLC is already in use. Instead, she decides to legally name her business Fanny’s Florals and Design, LLC.
Determine the Name is Available
Following the selection of a name but before filing the Articles of Organization, check to ensure that your name is unique on the Division of Corporations Name Search. Searching in other places, such as online, is also a good idea.
After you have determined that your chosen name is “distinguishable,” the name can be registered on your Articles of Organization. Name reservations are not available in the state of Florida.
Step 2: Choose a Registered Agent
Every LLC in Florida is required to have a registered agent. This agent can be an individual or a company.
The role of the registered agent is that of a contact person between the LLC and the state. As stated on the Articles of Organization application, “the registered agent agrees to accept service of process…at the place designated in the certificate.”
Simply put, the process agent receives communications or documents from the state involving such things as taxes or lawsuits and communicates them to the LLC.
Some may wonder why a Florida registered agent is necessary. The importance of the agent is to ensure that someone is always available to receive important documents even if the business owner leaves the office, goes on vacation, or is otherwise away. Also, having a registered agent is especially important if a physical office does not exist in Florida.
The owner of the LLC can designate a registered agent on the Articles of Organization application. The registered agent must sign the articles.
Individual as Registered Agent
Most importantly, the individual must be a resident of the state of Florida. An LLC cannot act as its own registered agent. Using a third party ensures that nothing falls through the cracks. The third party can be an accountant, an attorney, or even a friend. The agent must have a physical and mailing address in Florida and be at least 18 years of age.
Registered Agent Service
If using a service, the registered agent must be a business or professional. We recommend either using an LLC formation service (like Incfile or Northwest Registered Agent) which gives you a free registered agent or ordering a registered agent service by yourself if you choose to DIY your Florida LLC formation.
Step 3: File the Formation Documents with State
Let’s assume that fictional Fanny has selected both the name for her LLC and the registered agent. She is ready to complete the paperwork (called the Articles of Organization) that actually creates Fanny’s Florals, LLC in Florida.
This step can be completed either online, by mail, or in person. The filing cost is $125. Also available are a certified copy for $30 and a certificate of status for $5. In addition to payment, a cover letter with your name, address and telephone number must be included with the application. When you are ready, it is important to note a few details about each method to ensure that your application is fully completed in the time frame in which you need it.
Filing can be done online with credit card payment. Processing time is between two and three days.
Hard Copy Filing
The application (pdf) can be either filled out on your computer and then printed or printed and then filled out with ink. Payment can be made with a check or money order, payable to Florida Department of State. Processing time is between three and five days although it will take longer during heavier filing periods.
The application, cover letter and payment can be sent to the following address:
New Filing Section
Division of Corporations
P.O. Box 6327
Tallahassee, FL 32314
New Filing Section
Division of Corporations
2661 Executive Center Circle
Tallahassee, FL 32314
When processing is completed, a letter of acknowledgement will be issued.
Step 4: Create an Operating Agreement
An operating agreement in the state of Florida is recommended though not required. The agreement is a contract that defines the operations of the LLC, includes terms and conditions, states the responsibilities of its members, and ensures legal protections of its members.
All owners of the LLC must be in agreement of the terms in the agreement and sign before a notary public.
The operating agreement is useful for both multi-member and single-owner LLCs. In both cases, the agreement provides protections.
For example, in the case of the multi-owner LLC, the terms can stipulate what should happen if a death or divorce occurs among one of its members. In the case of the single-owner LLC, the agreement could be used in court as evidence that the LLC is separate from the individual owner.
The operating agreement can be created in two ways. Some individuals may choose to write the agreement on their own, using an online template. In this case, forms are available that are specific to state. Be sure to use the correct multi-member or single-member form.
The alternative is hiring an attorney to create the document. The benefits of using an attorney are ensuring the document doesn’t exclude any important information, adheres to state law, and invalidates default provisions that may not be what you wish.
Step 5: Get an EIN
An EIN is an Employer Identification Number. Anyone who runs their business as a corporation or partnership must file for this 9-digit number in order to identify the tax accounts of a business. The number can be applied for in one of the following three ways:
Applying online is the quickest method. The process can be completed between 7 a.m. and 10 p.m. EST, Monday through Friday. When the form is completed, the information will be immediately validated and a number issued while you are still online. In order to apply online, a valid individual taxpayer number, such as a Social Security number, is required.
Form SS-4 can be downloaded, completed and faxed to 855-641-6935, twenty-four hours, seven days per week. The EIN will be provided within four business days.
If either of the above methods are unavailable, Form SS-4 can be mailed, though processing will take approximately four weeks. The form can be mailed to the following address:
Internal Revenue Service Operation
Attn: EIN Operation
Cincinnati, OH 45999
Think you’re ready to open up shop now? Guess again!
Step 6: Taxes, Licensing & Income Reporting
Businesses like Fanny’s Florals and Design, LLC may be official after completing the above steps, but it is important not to overlook a few critical details.
On the federal level, most LLCs do not pay taxes directly to the government. Instead, they report income and losses on the owner’s personal 1040 tax returns. Schedule C is often used for reporting. Unless the LLC chooses to be taxed as a corporation, a single-member LLC is taxed as a Sole Proprietorship and a multi-member LLC is taxed as a Partnership.
Florida does not collect personal income tax. In addition, it does not impose a privilege/franchise tax on LLCs. An LLC may need to pay an unemployment insurance tax if the business has employees or a sales tax if the business sells merchandise. In either case, enrollment with the Florida Department of Revenue is required.
Whether your business needs a license(s) or permit(s) is dependent on the type of industry and location. The Department of Business and Professional Regulation issues licenses and permits of professionals and businesses in the state of Florida. Visit DBPR to determine what is required of your LLC.
Local municipalities and counties may also have their own requirements for licenses or permits. For example, many local governments may require a building permit, occupational permit, or health permit. Be sure to check the website of the municipality and county where your LLC will be located.
All LLCs are required to file an annual report in the state of Florida. The annual report is an update of the information filed with the Florida Department of State Division of Corporations. You will need a document number to file the report. This can be found either on your annual report reminder notice, which will be emailed to you, or through the sunbiz.org online search.
The cost for filing the report is $138.75, and the deadline is May 1. Penalties for late filing are stiff. If filed after the deadline, a $400 fee will be charged. If the report is still not filed on or before the third Friday in September, the LLC will be dissolved by the state.
Payment can be made online by credit or through a prepaid Sunbiz E-file account. If sending through the mail or delivering in person, a check or money order (payable to the Florida Department of State) along with a required payment voucher may be sent to the following address:
Florida Department of State
2661 Executive Center Circle
Tallahassee, FL 32301
Processing time is immediate for online reporting. Hard copy processing is between three and five business days although it could take longer during heavier filing periods.
When all of the mechanics of setting up an LLC in Florida have been completed, someone like Fanny can get down to the business of setting up a website, creating a logo…or purchasing flowers!
Need Help Creating Your LLC?
We recommend LLC formation services because it allows you to knock off an important thing off your checklist so you can focus all your energy on actually starting a business.
Can you do it yourself? Absolutely.
However, a service that forms an LLC for you will help with ongoing maintenance and keep you notified of any requirements you should adhere to.
As we mentioned earlier, IncFile and Northwest Registered Agent are the top LLC services available. If you’re not familiar with them, as a point-of-reference many of our readers like to compare them to the most well known LLC service, LegalZoom.