Limited Liability Company (LLC) is now a popular corporate formation among many business owners as it provides many benefits, especially for those who do not have sufficient capital to go for the option of sole proprietorship. In a sole proprietorship, you are the only one who owns the company and no one else gets to share any part of the ownership. However, with an LLC, you as the owner can have other people or companies share in the ownership of the business without having to pay the heavy tax rates that comes along with such transfer. To form an llc in georgia, the following guidelines should be followed.

 

Forming a Limited Liability Company in Georgia starts with getting the name. This name cannot be the same as the business name of the company. You will need to get a registered agent service. The registered agent service will provide all the information required on the formation of the LLC. In addition to that, they also help in the filing of the Articles of Organization with the Registrar of Incorporation.

 

Once the name is settled, the next thing is to select the registered agent. Normal business hours' office may be suitable. An alternate office location may be considered if the office is closed on weekends or holidays. The registered agent service will provide all the details regarding the contact of the registered agent.

Operating An LLC In Georgia

 

Another important aspect is the capital requirement to start an LLC. Capital for the LLCs in Georgia may be raised from the partners and/or family members. In some cases a private capital is also needed to fund the business structure. The procedure for raising the capital is the same for the normal corporations. The only difference is that there is no personal guarantee given in the case of an LLC. Hence the fee for setting up an LLC is also different from the fees for establishing a normal corporation in Georgia.

 

Every member has to file articles of organization. These articles should include the name of the LLC, its office address, its date of formation, its officers, its unique business structure and the powers possessed by it. All these requirements are mandatory for any Georgia non-profit corporation formation. The next step is to choose the registered office for the LLC. In case of an LLC having multiple offices, each office should have its own registered office. It is recommended that the address of all the registered offices is the same.

 

After completing all these steps, the filing of the Articles of Organization is done. After completion of this step, another important document is the receipt. For an active llc in georgia, the filing fee is not refundable, but for an inactive LLC it is applicable. In case of an inactive LLC, it should be filed within six months of its formation.

 

One more important document is the Operating Agreement. An operating agreement is required in every state of the union, even though it is not a federal law. An operating agreement of an active LLC in Georgia forms the basic understanding between the members and the principal and provides a means for the future management of the LLC.

 

LLCs are also governed by rules on financial issues like paying the annual income tax. There are some states that do not permit limited liability companies. The choice of an appropriate LLC structure is left to the sole discretion of the members. But for simple businesses that do not require many formalities, an active single-member LLC will serve the purpose.

 

The choice of tax structure is yet another fundamental decision an LLC owner must make in Georgia. Tax rates for LLCs varies in different states. So taxes on corporate and personal income. An active single-member LLC in Georgia is not taxable, whereas a dual-member LLC is subjected to state and federal taxation on its income. The rates of taxation differ for corporations and individuals. LLCs have always been subject to double taxation, which means that after all the corporate and personal income tax, their share in unpaid payroll taxes is also taken into account.

 

It is mandatory for every LLC to file a federal or state tax return. An active LLC in Georgia is free from double taxation, because its taxes are deducted at the source. So if it pays social security taxes, it can freely deduct its income tax in the same manner. But an inactive LLC in Georgia cannot take this advantage. The law provides that an inactive LLC cannot have an income tax return until it starts earning profits.

 

All types of business entities require that their owners have their personal information, ownership of the business and its location, at the time of applying for licenses and permits in Georgia. LLCs need to file annual and quarterly reports about its activities. All types of businesses, whether large, medium or small need annual reporting just like any other business entity, to ensure compliance with the law.

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