How to form an LLC in Wisconsin in 6 easy steps
Wisconsin is known as “America’s Dairyland,” and for you, it could also be a thriving business land. The first step is to structure your business in a way that makes the most sense. Like some business owners, you may decide that designating as a Limited Liability Corporation (LLC) is best.
Here are 6 steps to getting your Wisconsin Limited Liability Corporation started on a strong note.
1. Check if your business name is available
The first item on your agenda for business ownership should be finding out if your business name is available by conducting a name search. According to LLC laws in the State of Wisconsin, your company name must also:
- Include “Limited Liability Company,” “L.L.C,” or “LLC”
- Not include words like “partnership” or “corporation” that may make your name sound like a different business entity
- Be unique among existing Wisconsin businesses
If you wish to reserve your business name, you must file a Name Reservation Application with the state. Your name will be reserved for up to 120 days from the filing date. A name reservation gives you time to submit paperwork to form a business entity, whereas a trade name may give you other rights to that name.
2. Claim your name
So now you’ve chosen your business name for your Wisconsin LLC, what’s your next step? The next thing you need to do is claim that name by filing Articles of Organization. A quick refresher: Articles of Organization are part of the legal documentation required for LLC formation and register it with the state.
Your Articles of Organization must include a few critical pieces of information:
- Business name: Must include an indicator like “LLC” or “limited liability company”
- Registered agent: The person or company designated to accept legal documents on behalf of your business
- Business structure: This is where you specify whether your company is run by members or managers
- Organizer: Name, signature, address, and phone number required
- Effective date: Your LLC effective date can be 90 days of the filing date, or this can be skipped
Qualifying student entrepreneurs, however, can file the articles for free. If you are currently enrolled in a Wisconsin college, 18 years or older, and a member or organizer, then you may be able to have your fee waived.
In choosing a management structure, know that, typically, LLCs are run by members. In member-managed LLCs, each member shares day-to-day operational responsibilities. However, in a manager-run LLC, those members will appoint one or more managers to oversee operations.
When you file your articles, the process typically takes up to 5 days. However, if you pay for expedited service, it will be done within one business day of the filing date.
3. Write your operating agreement
While the State of Wisconsin does not require your LLC to have an operating agreement, having one is still a good idea. Without it, you could open yourself up to unnecessary litigation.
The LLC operating agreement consists of the following sections:
- Description of business purpose: Details whether or not you are selling professional services or goods
- LLC name: Full company name, not fictitious or assumed
- Management structure and responsibilities: List of members and details of how ownership stake is divided. Additionally, the type of LLC your business is organized as (Single-Member LLC, limited partnership, or Multi-Member LLC)
- Capital and asset contribution and distribution: Contribution of finances and assets, as well as distribution of profits and losses
- Meeting guidelines: Guidelines for hosting meetings for members and/or key business stakeholders
- Dissolution: Potential events that could cause the dissolution of the LLC
While you do not need to file the operating agreement formally, keep it in a personal file to have on hand for members and stakeholders to review if/when needed. If you are a single-member LLC or multi-member LLC, just know that you must fill out a separate operating agreement.
4. File your annual report
The State of Wisconsin requires all LLC owners to submit an annual report. The annual report contains any essential information pertaining to your LLC–the name and address of the registered agent, as well as the business address and contact information.
There are a few reasons you must have a registered agent file your Wisconsin LLC. For one, a registered agent will help you avoid late penalties by getting your affairs in order by the due date. Second, by using a Wisconsin registered agent service, you can maintain a sense of privacy because all of your business documents are sent to the agent’s office—not your personal address.
5. Pay your taxes
In Wisconsin, LLCs can be considered pass-through entities. In December of 2018, the state put through a law that allows pass-through entities to carry the responsibility of paying income tax over to the individual member(s).
When it comes to sales and use tax, any LLC with 2 or more members—or single-member LLCs taxed as corporations—is treated the same as any other business entity. If you are an existing partnership that becomes an LLC, you are not subject to state taxes on personal assets that have been transferred over in the process.
Now, all LLCs need to obtain a Federal Employer Identification Number (FEIN) from the Internal Revenue Service (IRS) to move forward with paying tax returns and hiring employees. Keep in mind that the FEIN is the same as the federal tax ID, so there is no need to confuse the two.
6. Wrap up other regulation requirements
Once you have your business set up to pay business taxes, you may want to obtain business licenses, or permits, as they’re called in Wisconsin. In Wisconsin, you must have a state seller’s permit if you are either engaging in business activities in the state or intend to sell tangible property or services that are typically subject to sales tax. Registration for this can be done through the Wisconsin Department of Revenue.
If you are a non-Wisconsin LLC (foreign LLC) or partnership, you will be required to register with the Wisconsin Department of Revenue. If this is not the case for your specific business, you can use the One Stop Business Registration portal to register your business with multiple government agencies. This will make your life as a Wisconsin entrepreneur 10 times easier.
If you are applying for a business bank account, credit card, or loan, it may not hurt for you to obtain a Certificate of Good Standing. This certificate verifies that your Wisconsin LLC was formed legally and is up-to-date with all state and federal filings.
Get LLC insurance in minutes by following these steps
So, you know how to start an LLC. Now, you need to know how to best protect it with LLC insurance. Huckleberry offers several options to help you get the right coverage for your business.
Here’s how to get started:
- Visit Huckleberry.com and click on the “Instant Estimate” button. Here, you can get quotes for various insurance coverage types.
- Type in your industry so Huckleberry knows what insurance coverages are right for you.
- Answer a few questions about your LLC, including payroll estimates, revenue projections, and more.
In less time than it takes to enjoy an order of cheese curds, Huckleberry will provide you with quotes for multiple small business insurance options.
In need of workers’ comp coverage? Use our quick workers’ comp rate estimator to get a free, no-commitment cost estimate.
Most Wisconsin entrepreneurs choose to establish their company as an LLC for the unmatched liability protection, so it’s wise to continue to protect your business with small business insurance. With all that being said, here’s to a successful chapter as a new business owner!
Whether you’re looking to enroll in workers’ comp coverage online or you need a general liability policy for your company, Huckleberry can help. And within just 5 minutes! Now that your LLC is off the ground, it’s time to offer yourself peace of mind and enroll in the small business insurance policy that works best for you and your business.