Forming an LLC in Florida
Florida is a pro-business state that has been focusing consistently on aggressive economic development. The state has a potentially huge market for retail and manufacturing businesses as well as trade. If you are planning to start an LLC in Florida then there are several processes involved. We have explained each relevant process in a step-by-step manner as follows.
1. Choose Florida LLC name
The first step towards new business formation is identifying a name for your business. A Florida LLC can register a fictitious business name also known as DBA (Doing Business As) or reserve a business name. There are certain LLC naming guidelines that you are required to follow along with Florida LLC name search. The guidelines are:
- The chosen name should contain “limited liability company” or abbreviations like L.L.C or LLC pursuant to Florida LLC rules – FL Stat § 605.0112 (2013).
- The business name should be distinguishable from the names of any other entity that exists in the records of the Florida Division of Corporations except for fictitious name registrations.
- The chosen name according to Florida LLC rules should not contain any language that implies or states that the LLC in question is connected in any way with a Federal or state government agency.
Once you have identified a business name; you need to conduct a Florida LLC name search also known as business name availability search. If your chosen name is available then you will be required to apply for reservation of the specified name by submitting a letter specifying the said name, to the office of the Florida Secretary of State. The name can be reserved for a period of 120 days pursuant to FL Stat § 605.01125.
2. Choose a Florida LLC registered agent
There is a process involved to start an LLC in Florida and this involves filing of the right documents, ensuring submission of correct information, and maintaining compliance with all state laws. As an entrepreneur not familiar with the business and legal landscape of Florida, you may face a certain level of difficulty where Florida LLC statutes regarding a new business are concerned. This is where a Florida LLC registered agent like IncParadise can provide valuable assistance.
In order to register a Florida LLC, it is mandatory to designate and continuously maintain a registered agent in the state pursuant to FL Stat § 605.0113 (2013). IncParadise can be your Florida LLC registered agent as we are committed to not only handling service of process as required by Florida statutes but can also assist you with the process of forming a new business and fulfilling annual requirements as required by the state.
3. File Articles of Organization with the Florida Division of Corporations
Now you have thought of a business idea so what next? In order to make the idea come to life, you need to choose a business name and structure, and then register the business in the state. If you plan to form a Florida LLC then the documentation required for registration is the “Articles of Organization” pursuant to FL Stat § 605.0201 (2013). The filing fee of the LLC formation documents is $125 and this fee includes designation of registered agent as well. As per Florida LLC rules, you will need to submit a “Cover Letter” along with the Articles of Organization that has to be mailed to the New Filing Section, Division of Corporations. We at IncParadise can assist you with the process of Florida LLC registration.
4. Prepare LLC operating agreement
An LLC operating agreement will be required if you are planning to start an LLC in Florida. It is a type of contract between the members or owners of a Florida limited liability company and it regulates the contributions of money by members to the LLC, distribution of company profits, and process of decision making within the organization. A reputable Florida LLC registered agent can provide guidance on the drafting of an operating agreement as it is quite similar to the Articles of Organization.
The scope, function, as well as limitations of an LLC operating agreement is governed by FL Stat § 605.0105 (2013). According to the Florida LLC rules and statutes, a properly drafted agreement should include the following:
- The names of the members of the limited liability company
- The duties pertaining to monetary contribution or services by each member towards the LLC
- The distribution of profit made by the Florida limited liability company
- The percentage of membership interests that is being allotted to each member and the proposed method of interest valuation
- The economic interest of each member towards LLC profit and property
- Detailed voting requirements and voting procedure for decisions of the LLC
- The responsibility as well as extent of authority of the manager of the limited liability company
- The transferability of Florida LLC interest to various third parties
- Outline of the process by which the concerned Florida LLC will exit or wind up its business
5. Obtain EIN
EIN is known as the Employer Identification Number and also the Federal Employer Identification Number (FEIN). When you form a Florida LLC, especially a multi-member LLC then you will need to apply for and obtain a unique 9 digit tax ID number. This number is assigned by the Internal Revenue Service (IRS) and used by businesses for tax reporting purposes although there are several other benefits of EIN as well. You can apply for the Employer Identification number directly with the IRS and if you hire a Florida LLC registered agent like IncParadise then we can help you obtain this tax ID.
6. Obtain the necessary business licenses and permits
Florida has a robust economy, a strong infrastructure as well as a competitive tax climate, which makes it a favorite location for entrepreneurs to register a Florida LLC. Once you form a business in the state, among other requirements; you will need to apply for and obtain the necessary business licenses and permits. Depending on the type of business activity and industry, you will have to obtain your license from the State of Florida agencies like the Department of Business & Professional Regulation (DBPR) or with the county your business is situated in.
For example: If you start an LLC in Florida in Orange County then you will need to obtain a business tax receipt, which is like a business license. Now, if you plan to start a restaurant that serves food and liquor then you will require multiple licenses and permits. You will have to ensure you are compliant with Florida LLC rules pertaining to Orange County zoning laws. Some of the aspects to consider while starting a food establishment in Orange County include the following:
As a restaurant or food establishment requires you to occupy commercial space, you will need to apply for a “Use Permit” pursuant to Orange County Code Sec. 23-98 (a) (14). You will have to apply with the Orange County Business Tax Receipt Office for the same.
You will also need to get approval from the Zoning Department under the Division of Building Safety.
You will have to apply to the Division of Hotels and Restaurants
You will have to apply for a business license or permit for food establishment with the Division of Hotels and Restaurants pursuant to Chapter 61c-4 of the Public Food Service Establishments under Florida LLC rules.
If you are serving liquor on the premises of your food establishment then you will have to apply for an Orange County Liquor License based on the type of liquor and type of business. A Restaurant serving “Beer, Wine, and Spirits” has an annual licensing fee of $1365 while that of “Beer only” is $280.
A Florida LLC registered agent like IncParadise can provide information and guidance pertaining to your business license requirement in the state. You can also make use of our Business License Research Report for detailed information on permits and licenses in Florida.
7. Open a bank account
When you register a Florida LLC you will need to ensure you are able to make and receive payments related to the business with ease. This is where a bank account to handle all your LLC transactions can be quite helpful. A business bank account is recommended because it helps segregate personal finances from those of the LLC and ensures clean maintenance of account books. This will also help you to track the annual cash flow of your business leading to efficient tax returns.
8. Comply with taxes and other regulations
Once you form a Florida LLC, you may be required to pay some form of tax, which may also be dependent on your business activity. Although the overall tax burden of Florida is less, some of the important taxes collected in the state of Florida include the following:
- Property Tax
- State Corporate Taxes
- Florida Sales Tax
The Florida sales tax is levied on mortgages, notes, liens, bonds, and a variety of written obligations. There is a state sales tax of 6% and then there is Hotel tax, Gas tax, and Electricity tax.
9. File LLC annual report
When you form a new business in the state of Florida there are certain annual requirements that your business needs to be compliant with or fulfill. One of the important requirements after you register a Florida LLC is that of a Florida Annual Report. According to the Florida LLC rules, FL Stat § 605.0212 (2013); a limited liability company operating in the state has to file an annual report with the Florida Division of Corporations.
The first annual report has to be submitted online or delivered to the Division of Corporations between January 1 and May 1 in the year following the year of new business formation.
For example: If you form a Florida LLC on Oct 24, 2021 then you will have to file your annual report between January 1 and May 1, 2022. Subsequent annual reports according to Florida LLC rules have to be delivered between January 1 and May 1 of each calendar year from there onwards. If you fail to file your annual report on time then there is a penalty or late filing fee of $400.
It’s easy to start a Florida LLC with IncParadise!