Doing Business in Florida

Florida is favored as one of the best places to form a startup as compared to several other states. There are 2.5 million small businesses thriving in the state and making a valuable contribution to the $1 Trillion economy. The state has a strong entrepreneurial ecosystem, which helps in increasing the overall success rate of a startup while ensuring both short-term and long-term economic as well as business growth. Apart from the pro-business climate and availability of Florida startup grants, one of the benefits of doing business in Florida is access to an ever-growing international trade platform. Today, small or medium-sized enterprises (SME’s) form 96 percent of Florida’s exporters and have been instrumental towards helping Florida become a leading state in the increasing number of new business applications.

Why do startups and small businesses prefer doing business in Florida?

The first thing that comes to mind when you think of Florida is a vast coastline, beaches, Walt Disney World, and Universal Studios among others. These are indeed integral drivers of the Florida hospitality and tourism industry, which is considered one of the largest as it was responsible for generating $27.6 billion in tax receipts. There are several other industries where startups and small businesses prefer to start their new business in. This is not all; there are business incentive programs, small business grants in Florida, and several factors and advantages that will aid in business growth and expansion. Some of these advantages or factors are:

• Favorable Tax Climate – One of the top advantages of doing business in Florida is the favorable tax climate it has. Florida is ranked #4 in the list of best states for business tax climate in a report by the Tax Foundation and this is because of its well structured tax system. If you are operating a sole proprietorship or a limited liability company then you will not be required to file a state income tax. Florida does have a corporate tax although it is lower than many other states. There are several incentives in the form of tax credits available with the Florida corporate income tax.
• Easy Access to Business Capital – One of the benefits of forming a new business in Florida is the ease of access to finance or capital for a small business including enterprise Florida grants. There are different forms of investments available through angel investors and venture capitalists that can assist a startup in the initial stages of their operations. Start-up financing is also available for different stages of a business like product development, market research, and initial marketing among others. Apart from private funding, businesses can also apply for new small business grants in Florida, government funding programs, and seed funds among others.
• Thriving Innovation Ecosystem – The state of Florida has a thriving innovation ecosystem that plays an integral role towards facilitating overall growth of entrepreneurs and small business owners in the state. These state-of-the-art ecosystems attract innovators as well as entrepreneurs by offering access to key resources like mentors, best practices startup events, seed funding, office space, Florida startup grants, networking opportunities and social investment programs.

Small Business/Startup Grants in Florida

When you form a small business in Florida, one of the advantages that you will enjoy is that there are a variety of Florida startup grants and incentive programs to choose from. Grants are available in different forms and the most common types include:

• Small business grants
• Federal grants
• State grants
• County grants
• Local grants
• Grants offered by private agencies

Enterprise Florida grants

The enterprise Florida grants are one of the most popular grants for businesses in the trade sector. These are most commonly known as trade grants whose objective is to support a business in exporting goods as well as diversifying into new international markets. The trade grants are offered by Enterprise Florida, Inc. (EFI) through their Florida Export Diversification & Expansion program. The new small business grants in Florida can be divided into three categories, which are:

• Grants for Virtual Options like the Virtual Business Matchmaking Grants
• Grants for Traditional Travel Options like the Target Sector Trade Show Grants and Gold Key/Business Matchmaker Grants
• Grants for International Business Development like Export Marketing Plans and Florida Online Global – Website Localization Grants.

Form your startup and leverage Florida Business Advantages!

Prospera Small Business Grants

Prospera small business grants in Florida are targeted towards assisting existing small businesses and startups to strive towards professional business development. Prospera is a non-profit entity that promotes economic development that also provides other services like empowerment for entrepreneurs through training and access to capital through micro-loans and commercial bank loans.

Florida High Tech Corridor Grant

The Florida High Tech Corridor Council Program provides small business grants in Florida to help businesses to accelerate their technical expertise and commercial accomplishments. These new small business grants in Florida have been designed primarily to target high-tech companies and are available in 23 counties. The grant amount can vary from $10,000 to $150,000 although the maximum amount can be $250,000 annually per project.

Amber Grant

This is one of the top Florida startup grants targeted towards women entrepreneurs in the state. The grant is awarded by the Amber Grant Foundation to women small business owners and the grant amount can vary from $10,000 (each month) to $25,000 (year-end grant). The primary objective of this Florida small business relief grant program is to help women entrepreneurs establish their business or startups in the initial and operational stages.

National Association for the Self-Employed Grant

The National Association for the Self-Employed (NASE) provides small business grants in Florida to startups so that they can make their businesses operational, grow and expand. The grant amount is $4,000 and they have been responsible for awarding more than $1 million in grants to startups since the program began in 2006.

Small Business Research Grants

There are different types of small business grants in Florida that a business or entrepreneur can benefit from. You have to qualify to be awarded a grant and one of the popular areas is the business research and development grants. This type of grant is available under federal and state grant programs with the most common being the Small Business Innovation Research (SBIR) program and the Small Business Technology Transfer (STTR) program. Depending on the type of new small business grants in Florida you choose, the grant amount can vary from $5,000 for small business entrepreneurs to $1,730,751 for Small Business Innovation Research (SBIR) programs.

USDA Rural Business Development Grants

The rural business development grants are managed by the United States Department of Agriculture (USDA) and hence are considered as federal grants. If you are searching for a Florida startup grant then this is a good grant to start with. There is no maximum grant amount or specific grant amount although smaller amounts get higher priority. This type of new small business grant in Florida can be used for a variety of purposes including:

• Technology-based economic development
• Business strategic planning on long-term basis
• Entrepreneur and leadership training
• Purchasing and setting up business related machinery or equipment
• Market research and feasibility studies

Other Recent Funding Opportunities Published in the Local State

There are several grant opportunities available for small businesses in Florida and since the covid 19 pandemic several new small business grants Florida have been published and made available to business owners and entrepreneurs. There are in excess of $31,979 million available in grants with an additional $22,686 million through Florida government funding. Some of the recent state funding opportunities and small business grants in Florida that you can opt for include:

• Conservation Innovation Grants FY 2021- Florida administered by the Department of Agriculture, Natural Resources Conservation Service
• Orange County CARES Small Business Grant approved by the Orange County Board of County Commissioners
• Indian River County Small Business Recovery Grant program
• St. Lucie Recovery Small Business Assistance grant program
• Head Start or Early Head Start Grant – Martin County, Florida
• Gulf of Mexico Program Reduction and Prevention of Trash, Florida
• Florida Urban and Community Forestry Grants
• Entrepreneurship Education and Training (EET) Grant

Ready to Start Business in Florida?

Whether you are a startup or an existing business; the need for capital is paramount and funding opportunities like enterprise Florida grants and micro-loans can be quite beneficial in the short to long-term. You can take advantage of various Florida small business relief grant programs and other funding options only when you have formed your business in the state. This is where IncParadise can assist you as we are an expert incorporation service provider in Florida.

Florida Business Tax

As a new business owner or budding entrepreneur; there are several facets of a business that you need to understand and one of such is the Florida business tax. At the same time, it is also important to identify the federal, state, and local business tax requirements. The type of taxes varies from one state to another although sales taxes, corporate taxes, and income taxes are common amongst most states. The Florida tax rate will also be different for different types of taxes. For example, the sales tax rate could be different from the use tax or property tax rate.

What taxes do businesses pay in Florida?

One of the important obligations of any new or existing business is to file tax returns and this could be for federal or state taxes. Each state in the USA has some form of taxes and business taxes can vary from one state to another. In some states, income tax is levied and in others there are no corporate taxes. A business in Florida may be subjected to different forms of Florida income tax and corporate taxes. Some of the other taxes that are common in this state include Communications Services Tax, Reemployment Tax, Discretionary Sales Surtax, Sales and Use Tax, Insurance Taxes, Beverage Tax, Documentary Stamp Tax, Corporate Income and Emergency Excise Tax, pollutant taxes, and Gross Receipts Tax among others. The Florida business tax rate for each category of taxes will be different.

Corporate Tax

The Florida corporate tax is also known as the corporate income tax or the franchise tax. It is a privilege tax imposed on specific businesses like professional corporations or for-profit corporations, which exist in Florida. The taxes are imposed on conducting business, or generating income through sales or service. The corporate tax is computed using several aspects of taxation like federal taxable income, additions, and subtractions, and Florida adjustments to arrive at an adjusted federal income. The Florida business tax rate for franchise tax or corporate tax is currently 3.535%, which has been reduced from 5.5% in 2019.

Sales tax

Sales tax in Florida is also known as the “sales and use tax” and is applicable on each sale by any business and also on storage and rental in the state. The Florida tax rate for sales tax is a flat 6% although it can vary in certain cases like the following:

• Sales tax on amusement machine receipts is 4%
• Sales tax on the license or lease of commercial real property is 5.5%
• Sales tax on electricity is 6.95%

How are Florida Businesses taxed?

If you are planning to start a new business in Florida then it is important to focus on the tax status of different forms of businesses. This simply denotes that a limited liability company will be taxed differently as compared to a sole proprietorship or a limited partnership. Some entities may be required to file some form of Florida income tax while other entities may be subjected to two or more taxes with the Florida business tax rate being different for each type of tax. Let’s look at the different types of Florida entities and their taxation.

LLC

If you form an LLC (Limited Liability Company) in Florida then you will be able to benefit from the fact that this type of entity is treated as a pass-through entity. This simply means that owners are not subjected to Florida income tax on the incomes that is passed on to them through the business. If the limited liability company is into selling of goods or services then it may be subjected to sales and use tax. The Florida business tax rate for sales and use tax is 6%. A limited liability company may also be subjected to the discretionary sales surtax depending on the county it is operating from. The surtax rate ranges from .5% to 2.5% although there are some counties where this tax is not imposed at all.

C Corporations

A professional corporation or C-Corp planning to conduct business in the state or is currently earning income in Florida, will be subjected to Florida corporate tax. This corporate income tax is also known as franchise tax and is imposed on the federal taxable income. The Florida corporation tax rate was 5.5% in 2019 and has been reduced to 3.535% in 2021. A C corporation has to report the corporate tax using the Florida Corporate Income/Franchise Tax Return (F-1120) and the due date is based on the tax year of the said corporation.

• Retail sales of taxable items
• Tangible personal property repairs
• Manufacturing or production for retail
• Sale of service warranty contracts
• Operating amusement or vending machines
• Provide taxable service

S Corporation

An S Corporation is also known as S Subchapter and it is a type of corporation that enjoys pass through taxation similar to a limited liability company. Small business owners elect S corporations in Florida as it offers legal protection similar to C corporations but are not subjected to the Florida corporate tax. These types of businesses and their owners are shielded from paying any state income tax on their individual income or the business income. The owners of an S corporation will be subjected to federal income tax on the income received from the business since this is a pass through entity. Apart from this, if an S Corporation qualifies for sales and use tax then the Florida corporation tax rate for the same would be 6%.

Sole proprietorships

A sole proprietorship is a type of unincorporated business where there is a single owner who is subjected to personal income tax on any profits they earn from the business. It is also known as a sole trader and Florida considers income earned through the business as ordinary personal income. Hence, it is not subjected to Florida income tax although the owner or sole proprietor will be assessed for federal tax at the ordinary income tax rate, which varies from 10% to 37%. There are 7 tax brackets each having a different Florida business tax rate and the rate is decided on based on the income cutoffs. For example: the rate is 10% for income of up to $9,950 and 32% for income between $164,926 and $209,425 annually.

Partnerships

Partnerships are a specific business structure where there is a formal arrangement between two or more owners or parties for management and operations of the said business as well as sharing of profits. There are different forms of partnerships that you can form. Some examples are: general partnerships (GP), limited partnership (LP) and limited liability partnerships (LLP). Since the income from a partnership business is distributed to the partners, they will be subjected to federal income tax at the standard Florida income tax rates. You will be required to file the Return of Partnership Income (Form-1065).

Ready to Register your Florida Company?

Whether you are planning to form a limited liability company (LLC), corporation or a partnership firm in Florida, the new business formation process can be quite a comprehensive and time consuming exercise. We at IncParadise are an expert incorporation service provider in Florida and can help you with registration of your LLC or incorporation in the state.

Business License in Florida

If you have an idea and are wondering how to start a new business then you need to apply for new business formation after you have identified a business structure. What’s next once your business has been formed? Even after incorporation, you will not be able to operate or transact in the state till you apply for a business license in Florida. The licensing and permit requirements as well as the cost of a Florida business license can vary from one state to another, one county to another, and also according to the type of business activity. A business license also referred to as a permit in certain scenarios may also require a business to be compliant with zoning requirements. For example, repair businesses are normally not allowed near schools or clinics.

What business license do I need in Florida?

If you are planning to start a new business in Florida then there are several state requirements to fulfill and obtaining a business license in Florida is one of them. Now, you are probably wondering if all businesses require permits or licenses and the answer is that most businesses require some form of licenses although it is not mandatory for all. Licensing and permitting including the cost of obtaining a Florida business license will be dependent largely on two factors:

• The business activity or what your business does. This includes: retail, restaurants, hotels, travel agency etc
• The city or county from which a business operates, ie. the City of Orlando, Dade County, Pinellas County, and City of Sarasota among others.

General business license (business tax receipt)

If you are forming a startup in Florida then your business may require a general business license. This type of license is also known as a business tax receipt and is required by specific business activities. If your business indulges in activities like selling goods or services then you will be required to apply for and obtain a license for Florida business. This is irrespective of where you are operating your business from whether from a rented commercial space or from your home.

Business license/permits for specific industries or professions

Apart from the business tax receipt, most startups depending on their industry will need to apply for a business license in Florida. There are several industries and business activities that are categorized under the “regulated profession or business” and hence have to apply with the Florida Department of Business and Professional Regulation (DBPR). Some of the regulated profession or business as mentioned by DBPR includes the following:

• Alcoholic Beverages & Tobacco
• Real Estate Appraisers
• Architecture & Interior Design
• Hotels and Restaurants
• Certified Public Accounting
• Veterinary Medicine
• Electrical Contractors
• Construction Industry
• Harbor Pilots
• Engineers

Example: If you are planning to start a restaurant with seating capabilities then it will be categorized under “Permanent Food Service (Seating)”. In order to obtain a license for Florida business in food services, you will have to create a facility plan for sanitation and safety and it has to be approved by the Division of Hotels and Restaurants, Plan Review Office. Post approval, you will have to apply for a new “Seating Food Service Establishment license” using the Sunbiz business license DBPR portal. Now, if you want to keep a vending machine within the premises of the food establishment then you would have to apply for an additional Vending Machine license.

Want to know what business licenses you need for your Florida Company?

Obtaining Business Licenses in Florida

A business license is essential for most new businesses as it ensures the business is able to operate or transact in the said jurisdiction. You have to first identify your licensing requirements and then apply for a business license in Florida, which depends completely on the type of business activity, location of the business, and the industry. As a small business, you may be required to obtain a regulated industry license as well as a business tax receipt.

How do I get a business license in Florida?

There are primarily two types of licenses in Florida, which are general licenses also known as a business tax receipt and licenses or permits for regulated industries and professions. You need to first identify whether your business requires to obtain a license for Florida business in either categories or a single category. In certain cases, you may even require local permits and approvals from local fire, police, health and zoning authorities. If you have a company office like a retail outlet in different counties or cities then you will have to apply for a local business license in each of those cities or counties. Similarly, you have to apply for Florida business license renewal in each of the counties or cities.

Application for a General business license

A general business license in Florida is also known as a Business Tax Receipt (BTR) or even an Occupational License. A BTR is required by law or municipal ordinances as it is issued by the local tax collector office in each city or county. In order to obtain a license for Florida business, you will have to apply with the Tax Collector’s Office in the city or county you are operating your business from.

Example: If your business is situated in Palm Beach County then you will have to apply for and obtain a license for Florida business from the Palm Beach County Tax Collector’s office. You will have to complete and submit the “Application for Local Business Tax Receipt” pursuant to County Ordinance No. 17-2. According to Sec. 17-17 of PBC Ordinance No. 72-7, you will not be issued any business tax receipt until you have complied with relevant county laws related to zoning, building, fire control, construction, and health. The cost of a Florida business license will vary according to the type of business activity and business tax will be generated accordingly.

What do you need to provide when applying for a Florida business license?

As a new business or startup, you will have to apply for a business license in Florida to make your company operational. Depending on the type of business activity, you may have to submit different types of documentation along with the permit or license application as well as for business tax receipts. The documents required are:

• Registration Documents – You will have to provide a copy of the Articles of Organization or Articles of Incorporation or any other formation documents depending on the form of business.
• Tax ID – One of the important documents required for new license application as well as Florida business license renewal is a copy of the Federal Employer Identification Number (EIN) or Tax ID Number. If it is not available then you can submit a copy of your Social Security Number (SSN).
• City Business Tax Receipt – If you are applying for a regulated business license in Florida and if your business is situated within the city limits then you will be required to provide a City Business Tax Receipt. If your business is situated outside city limits then a certificate of use from the Planning & Zoning Division will be required.

Do you want more information for your Florida Business Licenses?

How much does a business license cost in Florida?

There are two types of licenses in Florida; one is the small business license in Florida also known as the business tax receipt and the other is the license for regulated industries and professions. The cost of a Florida business license in either case would vary from one business to another and according to the business activity or industry.

For example: the license fee for a permanent food service or restaurant would be $262 for 1-49 seats and the fee for non-seating food establishments is $242 annually.

Renewing Florida Business License

Once you apply for and obtain a license for your Florida business, it is important to ensure it is renewed as and when required. If you have paid an annual license fee then it will be renewed annually and if you have paid a 1/2 year fee then you will have to apply for a Florida business license renewal after 6 months. If you fail to renew your business license or operate without obtaining a license then there can be fines and penalties for non-compliance and can even lead to business closure.

Need any Assistance in Obtaining Your Florida Business License?

If you are planning to start a new business in Florida state then it is important to obtain a license for Florida business to meet state compliances and make your business operational. Depending on the type of activity and industry, your company may require single or multiple licenses and permits. This is where the Business License Research Report service offered by IncParadise can be helpful towards providing you with information and guidance pertaining to licensing in the state.

Florida LLC Cost

A limited liability company is quite a popular form of business especially from the tax perspective. Also the cost to form a Florida LLC is lower than many other states. One of the important aspects of a limited liability company is that it can be treated by the Internal Revenue Service (IRS) as a corporation or a partnership depending on the number of members. You can even form a Florida LLC that is a single-member LLC and choose not to be treated as a corporation. In such a scenario, it will be treated as a disregarded entity.

Cost for forming an LLC in Florida

The cost to form an LLC in Florida is an important component that will help in determining your startup budget. It will be different from the formation costs of other types of business structures and includes a one-time new business registration fee and other important new business application fee.The Florida LLC formation costs initially would take into consideration the following:

• In order to form an LLC in Florida, you have to file Articles of Organization along with a filing fee of $100
• You have to reserve a business name prior to filing Florida LLC formation documents and the fee is $25
• You will be required to pay a “Registered Agent” fee upfront with the formation documents and it is $25
• If you require a Certified Copy of the articles then there is a fee of $30
• If you require a Certificate of Status then there is a fee of $5

Annual maintenance cost for a Florida LLC

If you are planning to form a limited-liability company in Florida then there is the initial cost and then there is the annual Florida LLC maintenance cost. The maintenance cost is minimal and only associated with the operational aspect of the business. There are different types of Florida LLC annual fees that you may be required to file to ensure active status. The annual maintenance expenses are:

• Once you have formed a limited liability company in Florida, you will have to apply for and obtain relevant business licenses and permits. The type of license and the fee will depend on the type of business activity. You may also require multiple licenses. These licenses or permits have to be renewed on a yearly basis and hence is an integral part of the Florida LLC annual fee.
• Once you have formed your new business, one of the most important Florida LLC maintenance costs is the annual report. The annual report fee is $138.75 and if you miss the due date then there will be a penalty of $400. Hence, any annual report filed after May 1 will have a fee of $538.75. The annual report has to be filed each year.
• Taxes are also an integral part of Florida LLC maintenance costs and tax returns have to be filed annually. There are different types of taxes that may be applicable like state sales tax and electricity tax among others.

Do you want to register a Florida LLC?

Florida Corporation Cost

The Florida Statutes enables the formation of different types of domestic and foreign corporations in the state. The laws are extremely flexible and friendly and along with a pro-business environment, strong infrastructure, and easy access to capital; Florida has become one of the top destinations for modern day entrepreneurs. If you incorporate in Florida, you will be able to benefit from several other benefits the state offers like low corporate income tax as compared to other states and a wide variety of business incentive programs and grants. These grants and incentives can help you to even offset the overall cost to form a Florida Corporation.

Cost of forming a Florida Corporation

The cost to form a Florida Corporation is an important aspect of new business formation as it will help you to determine the budget required to launch your company and make it operational. There is a one-time new business incorporation fee and then there are costs attached to various other aspects like marketing, staff recruitment, commercial space, and even office supplies. The annual cost for a Florida corporation can be categorized as under:

• You have to file Profit Articles of Incorporation and the filing fee is the same for both domestic and foreign corporations. The filing fee is $35 and is a one-time cost to form a Florida Corporation.
• You have to reserve a business name prior to file application to incorporate in Florida and the fee is $35.
• You will be required to file “Registered Agent Designation” application along with the articles and the fee for that is $35
• If you require a Certified Copy of the articles then there is a fee of $8.75
• If you require a Certificate of Status then there is a fee of $8.75

Annual maintenance cost for Florida Corporation

A for-profit business corporation is one of the widely chosen business structures in the state and the initial cost to form a Florida Corporation includes filing of articles, registered agent designation, and business name reservation or registration. There is also a Florida Corporation maintenance cost, which is basically a form of annual cost incurred by the company towards ensuring that the said company meets all state requirements. The different annual maintenance expenses are:

• Once you incorporate in Florida, you will have to apply for and obtain business licenses as well as permits. The type of licenses and the fees will depend on the type of business activity. You may also require zoning permits and county licenses depending on where your business is located. Business licenses have to be renewed on a yearly basis.
• Once you have formed your new business, one of the most important costs to form a Florida Corporation and maintain it is the annual report. If you miss the due date then there will be a penalty – any annual report filed after May 1 will have a penalty fee of $400.
• Once you incorporate in Florida, your company may be subjected to a variety of taxes and returns have to be filed annually.

Do you want to incorporate in Florida?

Need any Assistance in Forming Your Florida LLC or Corporation?

The cost to form a Florida LLC or a business corporation is an aspect that you need to consider prior to the incorporation or new business formation process itself. This will help you to plan your expenses or finances in a better way. You have to also take into consideration different incorporation and compliance requirements as specified by the Florida Statutes. We, at IncParadise can provide meaningful assistance if you are planning to incorporate in Florida or form an LLC and thus ensure you can start your business without any hiccups.

Florida Corporation

A traditional or C corporation is one of the oldest forms of business. There are specific advantages that this type of a business entity has and hence if you start a Florida corporation then you can leverage such advantages. Some of the biggest corporations based in Florida include Jabil Inc., Publix Super Markets Inc., Southern Glazer’s, H.I.G. Capital, World Fuel Services Corporation, L3Harris, and NextEra Energy Inc., among others. In order to start your business in the state, you will need to register your Florida Corporation online or offline but it is important to understand the different types of corporations that can be formed in the state. They are:

• C corporations
• S corporations
• Nonprofit corporations
• Professional Service corporation
• Social Purpose corporations
• Benefit Corporations

What is a Florida Corporation?

A traditional corporation also known as a C Corporation is one of the oldest legal entities in the world. If you incorporate in Florida then it would be an entity with its own rights as well as responsibilities. A traditional Florida corporation can be categorized in accordance to its tax status. Some examples of these categorizations include, a C-Corporation or an S-Corporation. A traditional corporation has the following:

• Directors – Whether you register a Florida corporation online or offline, directors are an important part of the corporate structure. They are elected by shareholders and are responsible for the overall planning and management of the company. For example, they are responsible for approving different types of corporate activities and transactions.
• Officers – They are specific persons hired or employed by the board of directors. They are mainly responsible for handling all day to day operations of the entity.
• ass=”mt5″>Shareholders – The shareholders are the owners of a corporation. Their ownership in the said corporation will be according to the apportioned ownership interest in the entity.

What are the benefits of incorporating in Florida?

Florida is a great state for startups as it has a pro-business environment and robust infrastructure. If you are planning to form a Florida Corporation then you can leverage several advantages including Foreign Trade Zones (FTZ) and Opportunity Zones. Some of the significant benefits of incorporating in Florida are:

• Helps in generating capital – Every company or new business requires capital to initially begin operations and to sustain its operations in the long-term. Once you form a Florida Corporation; you may also require capital depending on the type of business activity. This is one of the important benefits of incorporating in Florida and some of the options for small business loans or capital include Enterprise Florida Microfinance Guarantee Program, Angel investors, Venture capital, and Bootstrapping among others.
• Tax Climate – When you start a Florida corporation, one of the things you need to consider is the tax climate. Currently, Florida is ranked among the top 5 best states where a good tax climate is concerned. The state does not have an individual income tax and its corporate income tax rate at 4.50% is lower than New Jersey’s (11.50%), Pennsylvania’s (9.99%), Iowa’s (9.80%), Nebraska’s (7.81%), and Kansas’ (7.00%) among others.
• Business incentives – One of the benefits of incorporating in Florida is that the state offers a variety of incentive programs for different types of businesses as well as industries. Some of the top incentive programs include:
  • Capital Investment Tax Credit
  • High Impact Performance Incentive
  • Brownfield Incentives
  • Quick Response Training (QRT) Machinery and Equipment Sales Tax Exemption
  • Research & Development Equipment Sales Tax Exemption
  • Clean Energy Incentives
  • Research and Development Tax Credit

Know more about starting a Florida Corporation

There is a process to incorporate in Florida and more often than not, you will be face-to-face with questions that are integral towards making an informed decision. The questions may vary from benefits of incorporating in Florida to disadvantages or even dissolving a corporation. 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.

Why is Florida a great place to start a Corporation?

Florida is considered to be an excellent place to start a business especially if you are planning to start a Florida corporation. The state has a strong economy with a GDP of $1.1 trillion as of 2020. There are many benefits of incorporating in Florida like the pro-business state tax policy along with several high growth industries like agriculture, tourism, aerospace and aviation, life sciences, international trade, and financial services. There are several other reasons why entrepreneurs prefer Florida and they are:

• Overall low tax burden
• Access to investment capitalists and angel investors
• Consistent growth and revenue in the tourism sector
• Foreign trade zones and opportunity zones
• Variety of business incentive programs for small businesses
• Low startup costs
• Availability of small business grants

How much does it cost to incorporate in Florida?

If you are planning to register a corporation in Florida then there is a one-time cost of $70 for both domestic and foreign corporations and this includes a filing fee of $35 and registered agent designation of $35.

What are the annual costs associated with a Florida Corporation?

If you form a Florida Corporation then there are certain annual costs associated with new business formation pursuant to the 2019 Florida Statutes, Title XXXVI – Business Organizations, Chapter 607 – Florida Business Corporation Act. One of the important annual costs is that of an annual report and the fee is $150. Apart from the annual report, there will be other costs if you register a Florida corporation online like name reservation fee of $35. You will also need to obtain a business license or permit and the fee depends on the type of business activity.

Are there any disadvantages in forming a Corporation in Florida?

There are several aspects you need to consider in order to start a Florida corporation and these include advantages as well as disadvantages. Although the benefits of incorporating in Florida far outweigh the disadvantages, it is important to identify the same. The main disadvantages are:

• Double Taxation – Unlike an S corporation or a limited liability company, a C corporation is subject to double taxation. This simply means that a corporation is taxed on the profits and the shareholders on any distributions received from the business.
• Regulatory Complexity – If you register a Florida corporation online then you will be required to adhere to its strict regulatory requirements and that can reduce flexibility in many areas including to the company structure or minutes of the meeting.

Who can be a registered agent for your Florida Corporation?

The 2019 Florida Statutes, FL Stat § 607.0505 (2019) states that each domestic and foreign corporation transacting business in this state has to continuously maintain a registered agent. If you are planning to incorporate in Florida then you can hire IncParadise as we are well versed with the Florida statutes and requirements of incorporation. We can help you to file Articles of Incorporation in Florida and be compliant with annual business requirements and regulations. We are one of the top registered agents in the state and have assisted with the formation of more than 10,000 businesses.

Do all Corporations need a business license in Florida?

Yes. If you form a Florida Corporation then you will not be able to make your business operational until you apply for and obtain the relevant business licenses and permits. The type of business license required will depend primarily on the business activity and also on the location of the business as Florida issues both industry specific licenses and county licenses or permits. You can subscribe to our Business License Research Report service as it provides detailed information on several aspects of licensing in the state.

How to qualify a Foreign Corporation in Florida?

You can start a Florida corporation as a foreign entity but the process of incorporation would be different from that of a domestic entity. As a foreign corporation, you will not be able to transact in the state until you obtain a certificate of authority from the Department of State pursuant to FL Stat § 617.1501 (2019). This process is also known as Profit Qualification or Foreign Qualification. You will be required to submit an original certificate of existence and a cover letter along with the Application by Foreign Corporation for Authorization to Transact Business in Florid pursuant to FL Stat § 607.1503 (2019).

How do I dissolve my Florida Corporation?

Once you register a corporation in Florida, it becomes operational but if you want to close your business then there is a process that you will be required to follow. This process is called “dissolution” and you will be required to submit Articles of Dissolution pursuant to FL Stat § 607.1403 (2019). You can file these articles online (e-filing) or submit the Profit Articles of Dissolution application with the Amendment Section to the Division of Corporations along with a cover letter and filing fee of $35. It is important to note that the articles of dissolution for a corporation are different for corporations that have issued shares and those that have not issued any shares.

Ready to Start a Florida Corporation?

Florida is considered by entrepreneurs as one of the top states to register a new business. You can choose a wide variety of business structures although the benefits of incorporating in Florida makes the corporate structure extremely popular. There is a process to form a Florida corporation and it requires submission of documents and inclusion of information pertaining to the business.

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

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.

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.

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 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.

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

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.

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.