What Happens After You Form Your LLC?
Forming your LLC is a major step to making your new business official, but it’s only the beginning of building a legally compliant and successful business. Once your Articles of Organization are approved by the state, you still have important steps to take before you can operate with confidence.
Understanding what happens after you form your LLC will help you avoid compliance mistakes, create a strong operational foundation, and protect your brand from the start.
Step 1: Create an Operating Agreement
An Operating Agreement is a document that outlines how your LLC will function. It defines ownership percentages, profit distribution, decision-making authority, and what happens if a member leaves.
Even in states where an operating agreement is not legally required, having one in place is considered a best practice. Operating agreements prevent misunderstandings between members and provide legal clarity if disputes arise.
You can create your own, use a template, or work with an attorney to draft one that fits your business needs. If you form your LLC with us, a template operating agreement can be added on to any package and is included with the premium package.
Step 2: Apply for an EIN
An Employer Identification Number (EIN) is issued by the IRS and acts like a Social Security number for your business. You’ll need it to open a business bank account, hire employees, and file federal taxes.
The good news is that it’s free and quick to apply for an EIN online. You can apply directly through the IRS EIN application page. Not up to doing it yourself? It’s included with our premium LLC formation package.
Step 3: Open a Business Bank Account
Opening a separate business bank account is one of the most important steps after forming your LLC. Mixing personal and business finances can weaken your liability protection and make tax season a nightmare.
Look for a bank that offers:
- No or low monthly fees
- Online and mobile banking
- Integration with accounting software
Having a dedicated account makes it easier to track income and expenses and demonstrate the separation between you and your LLC, a critical part of protecting your personal assets.
Step 4: Obtain Required Business Licenses and Permits
Depending on your location and industry, you may need additional licenses or permits before you can legally operate. These could be at the city, county, state, or federal level.
Examples include:
- Sales tax permits
- Health permits
- Professional licenses
Visit your state, county, and city websites to determine what licenses are required for you to legally operate.
Step 5: Register for State Taxes
Some states require LLCs to register for additional taxes, such as:
- State income tax
- Sales tax
- Employer withholding tax
- Franchise tax
Check with your state’s Department of Revenue to determine your obligations.
Step 6: Set Up a Recordkeeping System
Good recordkeeping is essential for both compliance and smooth daily operations. Keep copies of:
- LLC formation documents
- Operating agreement
- Licenses and permits
- Tax filings
- Annual or biennial reports
Storing these in a secure, centralized location where you have easy access to them (Google Drive comes to mind) ensures that you have the documents you need, when you need them.
Step 7: Understand Your Ongoing Compliance Obligations
Once your LLC is up and running, you’ll need to file reports and pay state fees to remain in good standing. Requirements vary by state, but many have annual or biennial reports. Missing these deadlines can result in late fees or administrative dissolution. You can find more tips for keeping your business compliant here.
If URA is acting as your registered agent, you’ll receive a reminder when your annual report is due. We also offer our ACE Service, where we handle all compliance related requirements for your entity.
Step 8: Protect Your Brand
Once your LLC is official, you should take steps to protect and grow your brand. Consider:
- Trademarking your business name or logo
- Reserving your social media handles
- Building a professional website with HTTPS encryption
This helps establish your credibility and keeps competitors from using your name. Learn more about building a secure, trustworthy online brand here.
Step 9: Establish Internal Processes
The earlier you set up standard operating procedures, the smoother your business will run. This includes invoicing processes, customer service protocols, and financial reporting.
These processes help you stay consistent as you grow.
Key Takeaways
Forming an LLC is just the first step. The next actions you take set the foundation for your success.
Prioritize creating an operating agreement, getting an EIN, opening a bank account, and securing necessary licenses.
Stay on top of tax registrations, compliance requirements, and brand protection.
Consider professional support, like URA’s registered agent services and compliance reminders, to help you stay organized and avoid costly mistakes.
Final Thoughts
Starting your LLC is a big step, but it’s the steps that follow that determine how well your business will operate. By handling these tasks early, you’ll not only meet legal requirements but also position your company for long-term growth.
If you’re ready to protect your business and simplify compliance, URA can provide the registered agent services and annual report services that make staying on track much easier. Not sure what you need? Give us a call at (855) 236-9172.
