Navigation

TM

702-871-8678

How to Form Your LLC in Florida?

Florida situated in the southeastern region of the USA is considered as the fourth-largest economy in the nation. Florida is home to startups, small businesses and large corporations and you can choose to go with any structure that provides you with the advantages you desire. This article provides an insight into how you can form a Florida LLC, the benefits, the various steps towards successful business formation and operations like LLC name, tax ids, annual filing, licensing and permits, and Florida LLC registered agent services.

LLC in Florida

Florida is home to 18 companies that have been featured in the Fortune 500 list and this includes Publix Super Markets, Tech Data, World Fuel Services, MasTec, Fidelity National Information Services, NextEra Energy, and Hertz Global Holdings among others. There are better known cities like Orlando and lesser known cities like Doral, which have captured headlines by dominating the list of most favored cities for startups in the state. Entrepreneurs and first time business owners are increasingly opting to locate their business or start an LLC in Florida especially in cities like Daytona Beach, Doral, Delray Beach, Weston, and Lauderhill among others.

What is Florida LLC?

If you are planning to form a Florida LLC then it is important to first identify what a limited liability company really is. It is in fact one of the most popular forms of businesses in Florida and across the nation owing to the number of benefits it has over other business structures. One of the salient aspects of an LLC is that there are several types of LLCs that you can choose from. Some of them are:

  • Single-Member LLC or Sole Proprietorship
  • Series LLC
  • Member-Managed LLC
  • Manager-Managed LLC
  • Restricted LLCs
  • L3C Company
  • Anonymous LLC

The formation of a limited liability company is governed by Florida Statutes, Title XXXVI – Business Organizations, Chapter 605 – Florida Revised Limited Liability Company Act. A top Florida LLC registered agent like IncParadise can help you with the process of forming a limited liability company in the state.

What are the benefits of forming an LLC in Florida?

Entrepreneurs and new business owners prefer to start an LLC in Florida due to the many benefits this type of business structure has. Some of the top benefits are:

  • Once you register a Florida LLC, you can enjoy several benefits. One of the primary advantages is that a limited liability offers protection. This is also known as “Limited Personal Liability” because it limits personal liability. This is possible as an LLC is legally separate from its owners and hence, a limited liability company is responsible for its own obligations and debts.
  • Florida LLC rules are quite flexible and ensure business owners have less paperwork as compared to other forms of business like corporations.
  • One of the biggest advantages of a limited liability company is “pass-through” taxation. If you register a Florida LLC then the income and expenses of the limited-liability company will be passed through to the personal tax returns of the owners or members.
  • One of the salient aspects of the Florida LLC rules is that there is a lot of management flexibility. An LLC doesn’t require a formal structure and the owners enjoy more choices with regards to making decisions and how to run their businesses.
  • Once you form a Florida LLC, you will be able to apply for a variety of business incentive programs administered by Enterprise Florida, local cities and counties like the City of Orlando, and Florida Department of Revenue among others.

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!

Know more about starting a Florida LLC!

If you are planning to start an LLC in Florida, then you may be faced with several questions that need to be addressed. You may have questions pertaining to the cost of registering in Florida like the annual fee, disadvantages of forming in the state, Florida LLC registered agent services, and much more. Hence, we have created this section of “Frequently Asked Questions” for addressing some of the most common queries that a startup or entrepreneur may have.

Is Florida a good place to start an LLC?

Florida has always been on the global map when it comes to tourism but did you know it is a great place for starting an LLC? The state offers several benefits to small businesses, startups as well as medium sized enterprises. Some of the top benefits include:

  • Variety of economically growth oriented industries where you can form a Florida LLC
  • Robust infrastructure and logistics environment to provide all the support a new business requires
  • Business and funding events, seminars, and conferences for entrepreneurs and small businesses
  • A pro-business tax climate along with asset protection benefits
  • Florida is home to several foreign-trade zones (FTZ) where merchandise is not subject to custom duties and tariffs as well as other ad valorem tax.
  • There are 427 Qualified Opportunity Zones where businesses can enjoy deferred and reduced taxes.

How much does it cost to register an LLC in Florida?

If you are planning to register a Florida LLC then there is a one-time cost of $100 for both domestic and foreign LLC’s. There will be other costs associated with forming an LLC like Name Reservation ($25) and a mandatory Registered Agent Fee of $25.

What are the annual fees for a Florida LLC?

According to the Florida LLC rules and statutes, every limited liability company conducting business in the state has to file an annual report with the Division of Corporations. The fee for the Annual Report is $138.75. An integral part of the new business operation is obtaining a business license or permit. The fee will vary according to the type of license and the type of business activity and this license will have to be renewed each year.

What are the disadvantages of forming an LLC?

An LLC or limited liability company is one of the most popular forms of businesses in Florida because of the several advantages it has over other forms of entities. It is also important to understand that if you start an LLC in Florida then there may be certain disadvantages of this type of entity. Some of the disadvantages are:

  • Initial and ongoing costs – A Florida limited-liability Company is quite easy to set-up but certain initial and ongoing costs makes it expensive to create and maintain this type of entity.
  • Business ownership transfer – If you form a Florida LLC then ownership transfer in a limited-liability company is a difficult and complex process. If the said LLC has any debts then ownership transfer may become extremely difficult.
  • Limited Case Law – A limited liability company is a type of entity that is fairly new as compared to corporations, sole proprietorships, and partnerships. Hence, there is a limited legal precedent that one can draw from if any dispute arises.

Do I need a registered agent for my Florida LLC?

A Florida LLC registered agent is mandatory for every domestic or foreign limited liability company planning to register and operate in the state pursuant to FL Stat § 605.0113 (2013). You can hire IncParadise in Florida as we are well versed with the requirements of an LLC and can help you to be compliant with the relevant LLC statutes and new business requirements and regulations. We are one of the top registered agents in the state and have been responsible towards helping form more than 10,000 businesses.

Does an LLC need a business license in Florida?

Yes. If you start an LLC in Florida then your company will be unable to operate till you apply for and obtain the necessary business licenses and permits. The type of business license required will depend on the business activity. You can subscribe to our Business License Research Report service as it provides detailed information on several aspects of licensing in the state.

Can I register a foreign LLC in Florida?

Yes. You can register a foreign limited liability company in Florida although the process would be different from that of a domestic LLC. The Florida LLC rules and statutes, FL Stat § 605.0902 (2013) state that you will be able to transact business in the state only if you apply for and obtain a certificate of authority. It is also known as the “Qualification of Foreign LLC” application and has to be submitted with the Registration Section, Division of Corporations along with a cover letter and certificate of existence.

Can I cancel my LLC in Florida?

There are several reasons for dissolving a limited liability company, some of which may be purely personal and some financial or business related. Once you register a Florida LLC; the only way to cancel is by filing Articles of dissolution pursuant to FL Stat § 605.0707 (2013). The articles can be submitted online or can be submitted via mail with the Registration Section of the Division of Corporations. The articles have to be submitted along with a cover letter and a filing fee is $25.

Ready to form a Florida LLC?

There are different types of business structures that you can choose from in Florida as it is a popular destination for entrepreneurs owing to the many advantages the state offers. If you are planning to form a Florida LLC there is a registration process that requires you to submit a variety of information and documentation. This is where IncParadise can assist you with the formation of your new businesses in the state.

IncParadise is a highly reputable Florida LLC registered agent and we have helped thousands of companies to start their businesses with ease. We also offer a wide variety of additional services like foreign qualification, EIN assistance, and certificate of good standing or certificate of existence in Florida among others.

Form an LLC in Florida with us effortlessly!