Launching a business is an exciting adventure for anyone who has ever dreamed of bringing an idea to life and becoming their own boss. Whether you’re offering a service or selling a product, having the proper resources on hand, managing a solid financial plan, and producing high-quality work and goods are crucial to become a profitable small business owner.
One of the most common business structures is a limited liability company (LLC). According to the Internal Revenue Service, while each state abides by its own regulations, LLCs are entities often owned by individuals or multiple members. One of the benefits of an LLC is that it protects the owner’s (or owners’) personal assets in the case of legal issues. In other words, business owners do not have to pay with their personal finances if a lawsuit arises.
If starting an LLC sounds like the right move for your small business goals, there are a few key steps to get the process started.
How to form an llc in wisconsin
Name Your LLC
First things first: Pick a name! Creating an original, memorable, and perhaps even meaningful brand name is one of the most exhilarating parts of starting a company. However, if you’re founding an LLC, your company’s name must be completely unique, particularly in the state in which you’re opening a business. In other words, if your preferred name is not allowed or already in use, you won’t be able to claim it. Having a unique company name not only allows your brand to stand out in the marketplace, but it also helps prevent potential trademark infringement claims.
One important thing to note is that naming your LLC doesn’t have to be an overly complicated endeavor, as the name is mostly going to be used in trade forms and legal documents. For instance, many people use their full name as the actual name of their LLC (e.g., Jane Smith LLC) but market their brand under an entirely different name (e.g., Jane’s Trinkets & Gizmos). To go this route, you can always file a Doing Business As (DBA).
APPOINT A REGISTERED AGENT
A registered agent, also known as a resident agent or a statutory agent, is an individual or business entity that functions as the LLC’s point of contact. This step is required in most states, as the registered agent acts as a go-between during regular business hours.
The registered agent intercepts all tax and legal documents on behalf of your business. Anyone 18 years old or older can be a registered agent, as long as they have a physical address in the same state as your LLC.
PREPARE THE OPERATING AGREEMENT
The operating agreement is essentially a formal document that outlines how your LLC will run. It also gives you a strong sense of control over your company and includes specific details about the business’s organization, rules and regulations. According to the U.S. Small Business Administration, the operating agreement is the official signed contract to which the LLC’s members are bound.
The document includes details about:
- Voting rights
- Member duties
- Percentages of ownership
- Distribution of company profits and losses
- And other affairs
If you need help formulating your operating agreement, you can recruit a trustworthy business formation service or hire a lawyer.
FILE THE ARTICLES OF ORGANIZATION
The Articles of Organization – also called the Certificate of Organization or the Certificate of Formation – is a form you must complete and file with the Secretary of State’s office to establish your LLC. Once you have successfully filed your Articles of Organization, your LLC will be legitimate!
If you’re a small business owner or have a desire to carve your own innovative career path, it’s important to keep your assets properly protected with business insurance that meets your needs. Contact your local Rural Mutual agent to learn more.