How to form an LLC in Georgia in 6 easy steps
One of the most exciting journeys in life is starting your own business. If you’re an entrepreneur in the state of Georgia and are thinking about starting your own company, you might want to consider forming an LLC. While it’s not an impossible task to start an LLC in the Peach State, the process can be a bit immersive.
The following 6 steps are designed to help guide you through the process of becoming Georgia’s next LLC so that you’re spending less time stressing over business structure and business formation documentation and more time launching your new business into the stratospheres of success.
1. Check if your business name is available
Selecting a name for your business can have big ramifications for your company's future. Choose an LLC name that’s catchy and meaningful to you and speaks to your brand. People have limited mindshare, so selecting a unique company name will help make it more memorable. This is especially essential because the name of the LLC must be different from any preexisting Georgia business name.
Additionally, there are several naming guidelines your chosen business name must adhere to. The name of your Georgia LLC must end with the phrase “limited liability company” or the abbreviation LLC or L.L.C. Certain words that make it seem like your business is part of a government organization—such as BI” or “Treasury”—are prohibited, while restricted words like “University,” “Bank,” or “Attorney” can only be used if you intend to meet other requirements or possibly fill out additional paperwork.
Once you’ve chosen your business name and have ensured it meets the Georgia naming requirements, you’ll then want to conduct a business search on the Georgia Secretary of State’s website to verify that your desired business name is available. If it is, awesome! You’re ready to claim your name. If your desired name is unavailable, you may want to reserve your second or third choice while determining which alternative moniker makes the most sense. To reserve a business name, you’ll need to submit a Name Reservation Request form on the Georgia Secretary of State’s website along with a $25 filing fee, which will keep your potential business name on lock for 30 days while you decide the best course of name action. You may also want to secure the domain name for your business if you set up a website for it later.
2. Claim your name
With your chosen business name selected, you’ll next be required to nominate a Georgia registered agent to handle any legal documents and lawsuits for your LLC. The Georgia registered agent can be an individual—such as a business attorney—or a company, such as registered agent service or formation service. Suppose you choose to use an individual as your registered agent. In that case, they’ll need to be a permanent resident of Georgia, possess a Georgia physical address (not a P.O. box), and be available to receive mail during regular business hours. You can also nominate a member of your LLC to be the registered agent—or even yourself—provided you or the nominee meet the requirements.
After your registered agent is solidified, you’ll want to enlist the agent to help you file your Georgia Articles of Organization. To file Articles of Organization, you’ll need to fill out and submit Form CD 030 to the Secretary of State Georgia Corporations Division, which you can do either online or by mail, along with a $100 non-refundable filing fee. If you’re filing by mail, you’ll also need to submit an additional document—the Transmittal 231 Form—which contains your LLC’s legal name, the names of your LLC members, your registered agent’s information, and the LLC’s business street address. If you’re filing online, you do not need to submit the transmittal form.
After the Georgia Secretary of State receives your Articles of Organization, they will mail your LLC a certificate of organization within 5 to 7 business days. In some situations, processing can take up to 12 business days.
If you’re setting up a new branch of an LLC that was formed in another state—outside of Georgia—you’ll also need to fill out a Foreign LLC form, which allows an LLC to operate as a single entity across many states. The Foreign LLC form–Form 241—costs $225 in LLC filing fees.
You may also opt to register a trade name—or DBA (Doing Business As)—which is a fictitious name you can use to conduct business that’s different from the name you used to form your LLC. For example, if your LLC is Peanut Butter, LLC, you can create a DBA to be Pete’s PB&J’s. Choosing to use a DBA is a helpful tool if your LLC operates several different types of businesses because it allows all of your revenue streams to be filed as a single entity only once. A DBA also helps you launch new ventures separate from your core LLC business and helps separate your sub-businesses from the primary LLC entirely. To register a DBA in Georgia, you’ll need to file a DBA application with the Clerk of Superior Court in the county in which your LLC resides.
3. Write your operating agreement
While you’re not required to write an operating agreement in the state of Georgia, it’s still a fantastic idea to draft one anyway. An LLC operating agreement outlines the ownership and operating procedures of the LLC and the responsibilities and rights of each LLC owner and member. Think of the LLC operating agreement as a blueprint for your organization’s day-to-day functions and a roadmap for how you envision your LLC running.
Without an LLC operating agreement in place, you might encounter legal snafus should your LLC ever become embroiled in a lawsuit. Your vision for your LLC would be subject to Georgia state LLC laws rather than what’s outlined in your document. The operating agreement also helps solidify that your LLC is its own entity, which helps keep your personal assets off the table.
4. File your Statement of Information
To ensure your LLC’s address, registered agent, and registered office information is up to date, you’ll need to file your annual registration statement—aka annual report or Statement of Information—with the Georgia Secretary of State. Even though you’re just now forming your LLC and won’t have to submit your first annual registration until the following year, it’s still a good idea to familiarize yourself with the process so that you can have your information organized and ready to go.
The annual registration is due between January 1st and April 1st each year, and you can file the statement either online or by mail for a filing fee of $50. If, after filing, you need to make any changes to your business information, you can submit an amended statement along with a $20 filing fee.
5. Pay your taxes
How much you pay in taxes and how you pay your taxes will depend on the business entity you selected to classify your LLC as during your LLC formation. In Georgia, single-member LLCs are taxed as sole proprietorships by default, and if they’re multi-member, they’re taxed as partnerships by default. If operating as a sole proprietor or a partnership, your LLC’s income and losses are reported on your own tax return and those of any other LLC owners.
However, the neat thing about being an LLC is that you can choose to be taxed as a corporation. Choosing to be taxed as a C corporation or S corporation means your LLC will pay an annual state corporate tax and will need to pay a net worth tax based on the value of the company’s assets. These taxes are in addition to federal income taxes, and if your Georgia LLC has employees, you’ll also be on the hook for paying payroll taxes.
If your LLC is being taxed as a corporation, you’ll need to apply for a Federal Employer Identification Number—or EIN—through the Internal Revenue service. Your Federal Employer Identification Number—also known as a Federal Tax Identification Number— acts like a Social Security Number for your LLC and is how the IRS monitors your business’s financial activities and income tax reporting. You can obtain your Federal Employer Identification Number for free by mail or online via the IRS website.
Another reason to apply for a Federal Employer Identification Number is so you can open a credit card or bank account for your LLC. To do so, you’ll need:
- Your Federal Employer Identification Number
- Your Articles of Organization
- Your driver’s license
Having a separate business bank account is essential to running a successful LLC because it helps keep your business transactions away from your personal transactions, making it harder to “pierce the corporate veil” or mix your business and personal transactions. A business bank account and business credit card also keep all of your LLC transactions in one place, making it easier to organize and compile your financial documents when submitting your tax returns. Should you ever be involved in a lawsuit or be taken to court, a business bank account can also help mitigate any case against you by demonstrating that your LLC is, in fact, its own separate entity and is unaffiliated with any of your personal assets.
6. Wrap up other regulation and sales tax requirements
Give yourself a round of applause! You’ve finally made it to the finish line of forming a Georgia LLC, so take a minute to feel good about your accomplishment. As you begin to tie up any loose ends and wrap up any final tasks, you’ll want to explore which Georgia business licenses and permits are necessary for you to secure so that your LLC can conduct its business. Georgia does not have a universal business license, but there are required licenses for certain types of professions and types of companies. Consulting the Georgia Secretary of State’s licensing page will give you more information on which licenses and permits pertain to your LLC.
You’ll also want to explore any remaining Georgia state tax requirements that may affect your specific business operations and the amount you’ll end up paying in-state fees. To get started with your state filing, you’ll need a State Tax Identification Number (STIN), mainly if you’re selling goods or services. If your business sells goods or services, you’ll need to pay sales tax at a rate of 4%. Depending on the type of work your LLC is involved in, you might also have to pay some of Georgia’s other less popular state taxes. These include film tax, alcohol and tobacco tax, and motor fuel tax.
As a business owner, you’re also on the hook for other taxes pertaining to your employees. These include withholding taxes, which you withhold from your employee’s wages to pay the state, and unemployment taxes. In Georgia, you, as the business owner, must pay the entire cost of unemployment insurance benefits. Speaking with a business tax professional, business attorney, or business accountant is a great way to gain clarity around which licenses, permits, taxes, and state laws you’ll need to navigate for you to run your particular LLC smoothly and successfully.
The last housekeeping item you’ll want to explore before launching your LLC is small business insurance. Small business insurance keeps you and your business legally protected from the unexpected, which helps put your mind at ease knowing you can spend more time growing your LLC and less time navigating potential legal headaches. While there are many insurance options for your LLC, the following are three of the most common types of insurance that could address most of your LLC’s needs:
- General Liability Insurance: This general policy offers a wide range of liability protection from potential lawsuits to you and your LLC.
- Professional Liability Insurance: Professional service providers such as consultants or accountants are the primary beneficiaries of this policy since it helps cover against different types of business errors and malpractice.
- Workers’ Compensation Insurance: Provides coverage to your employees in the event of illnesses, on-the-job injuries, or even death.
You may also want to consult your business accountant for advice on the other types of business insurance that might be relevant to your specific LLC’s operation. They can also ensure your LLC remains compliant with all federal tax and state tax laws and filing requirements.
Get LLC insurance in minutes by following these steps
Choosing the right business insurance for your LLC can, at times, be an overwhelming process. That’s where Huckleberry can help.
Huckleberry is a quick and easy solution for all of your business insurance needs. They make the purchase of business insurance simple. Here’s how you can get started:
- Go to Huckleberry.com and choose the “Instant Estimate” option. We’ll then provide you with quotes for LLC insurance and other types of coverage designed to meet the needs of your specific LLC.
- Input the type of work your LLC is involved in, which helps Huckleberry customize your insurance options.
- Answer a few basic questions about the nature of your company, helping Huckleberry tailor its insurance option results to only those that can directly benefit your LLC.
- After a few short minutes, you’ll receive a quote containing customized small business insurance options.
- If you haven’t started the process but are still doubtful, check out the Huckleberry workers’ comp calculator to provide an accurate workers’ comp cost estimate.
Congratulations! You’ve just established your very own Georgia limited liability company! While the sweet taste of completion is as sweet as a Georgia peach, don’t get too comfortable and forget to snag a quality GA business insurance policy to keep you, your assets, and the future of your LLC safe and protected.
For all things business insurance, Huckleberry has you covered. In less time than it takes to prep a peach cobbler, Huckleberry can serve you a platter of insurance quotes and policy options that will protect your LLC for years to come.