and again Jim Hart back out you're here
from Hawthorne law and today I want to
share with you how to start an LLC
[Laughter]
this information is gonna be pretty much
the similar regardless of what state
you're in
as an attorney I practice in North
Carolina I'm also licensed in Florida so
by the end of the day I'm going to tell
you about the different steps you need
to know if you're gonna start your own
LLC and this is really important
actually a client in yesterday he was
wondering who was trying to going
through a divorce situation and they
have a business a rental property
business that he needs to separate with
his wife and they both want to keep the
rental properties and we talked about
one of the things they can do is start
an LLC so how do you do that well it's
actually pretty easy to do depending on
the state you're on and before I get
into that I want to remind you hit the
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anyway here's the deal when you're
starting an LLC the first thing you need
to do is you need to do a search for
your name you need to make sure your
name is not taken and this doesn't need
to necessarily be your brand name this
can be a special name for your LLC your
business name but you need to go to the
way you're gonna do that is you're gonna
go to your Secretary of State's website
in the state where you're starting the
LLC by the way I need to mention
something right off the bat you do not
need to go to Delaware you do not need
to go to Nevada you do not need to go to
why aunt Wyoming to start your LLC you
can start your LLC in your own state if
you're starting in another state then
you're gonna have to register in your
own state anyway as a foreign entity big
mistake costs a lot of money it's more
effort it's more pain than it's worth
don't do it there's there's people out
there they say you can do that because
you can avoid taxes you can't avoid the
taxes okay
rant over start the LLC in the state
where you're doing business that's gonna
be the best state for you to do it in
that's number one number two so I
already mentioned go to your Secretary
of State's website do a search for your
name make sure the name is not taken if
it's not you can go ahead and file what
are called or are articles of
organization and I think it's named the
same thing in all 50 states I'm not sure
about that but that's that's what you're
gonna file you're gonna fill out this
form your articles of organization it's
going to give information like the name
of the LLC the business address who the
agent is make sure you see up here my
video on registered agent that needs to
be an actual physical address where
somebody can accept mail on behalf of
your business if you get sued that's
where the registered agent does
basically there's corporate entities
that do that but it means to be a
physical address in the state where your
LLC is located they're gonna want
information such as who the initial
members are of the LLC owners of an LLC
are called members not shareholders and
other information like that and you're
gonna take those articles of
organization you're going to take them
down your Secretary of State's office or
potentially you can file this
electronically through through the
interwebs and you're gonna pay a filing
fee it varies in different states and
then once they file those your LLC is
going to be formed they're gonna send
you a little a document back that's
gonna tell you that your LLC has been
formed then you can the LLC but here's
the thing that's not enough people if
that's all you're doing to start your
LLC there you might as well do nothing
because it provides no liability
protection to you there's no tax
advantages to doing that that you you've
basically done nothing to protect
yourself which is the whole point of
forming LLC hold on a second my wife
thinks wanted me when I drink coffee
that way anyway if you're getting what
I'm saying so far make sure you leave a
comment down below and just type
something cool you can type something
cool that's fine and let me know you get
what I'm saying so far so that's number
one
you got to file those articles of
organization but there's another step
you need to create and what's called an
operating agreement an operating
agreement is a document it's a contract
between you and you as a member of the
LLC and the LLC the basically spells out
exactly how the LLC is going to operate
what you're gonna pay yourself in terms
of a salary or distributions or how
those are going to be distributed all
those different things where the
businesses can be located what you're
gonna do if you decide to add new
members what you're gonna do if you
decide to break up with your the other
members how often you're gonna have
meetings what's going to be the subs
those meetings all these things there's
all these things that need to go into
this operating agreement and you need to
have that done and then you need to
follow the next step is you need to
actually follow the terms of the
operating
so that if somebody decides to see you
at some point they can't do what's
called piercing the corporate veil and
by piercing the corporate veil that's
how they can do that if you basically
don't operate yourself as the LLC
according to the terms of your operating
agreement so that's important all right
the next step is to make sure
oh and let me go back if you're in some
some states ask you to publish a
notification I know I think New York
asks you to do this so there might be
other requirements in your particular
state you want to check those
requirements and make sure that you
follow the law and the legal
requirements in your particular state
the next thing you want to make sure you
do is remember to to file all the
necessary updated paperwork every year
and and that may be annual minutes that
may be an annual report different things
there's usually going to be filing fees
associated with with this so you want to
make sure you do that on an annual basis
to make sure your LLC stays active I've
had situations where people have failed
to do that and then the LLC becomes
inactive and then anything the LLC has
done up to that point while it's
inactive basically is is void I had a
big issue with the client who there it
involved a transfer of real estate
through the LLC and a deed was passed
and money was paid and things like that
but the LLC does not shoot we're talking
about Oh making sure you do all the
annual reporting requirements you need
to make sure you do that if you don't do
that
then you can run into problems and your
LLC can be disbanded and as I mentioned
I had a client that had a real estate
deed and the real estate deed was
basically void and that was a big
problem because my client had spent
several hundred thousand dollars I'm
acquiring that piece of property but his
deed was no good and then there was a
death and that's that's what we do
that's what lawyers do we deal with
problems like that so we try and fix it
all but the better thing to do would
just make sure the LLC never had a
problem in the first place so that's
what you need to do that's how you start
and run an LLC and other than that I
mean I've got other videos here about
about how to pay yourself in an LLC
about the tax implications different
things like that I'll make sure to keep
those up here and include links down
there
and other than that I hope you have a
great day folks I hope you are having a
wonderful business I think I hope things
are going well for you and let's see
what else don't forget to hit the little
button down here subscribe and like this
video if you like it if you don't like
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you want to but I like to I like when
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so thanks so much folks have a great day
and we'll be back next time with another
awesome video take care peace why do I
do that I don't know why I do that
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