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6 Helpful Steps in Forming a California LLC

04th February 2011
By lawinc in Business Law
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If you are beyond any doubt ready and determined to form a California Limited Liability Company. The truth is the best route of action is to get your company a group of professionals who concentrate in the formation of LLC and corporations. This is the case if you and your company are new to the whole industry. This is a serious matter because if your company makes mistakes in the process, it will have a massive impact on the business. However, if you think that you are fine by yourself, then you must research well on how the papers are processed. Here are some steps on how to form a California LLC that will surely guide you along the way.
1. Check if the name is still available.
The company will have to research the availability of its preferred name. In cases wherein another company is carrying the same name, prepare alternative names to make a separate distinctiveness. You also have to remember to incorporate the words “Limited Liability Company” or “LLC” in the company’s name.

2. Prepare the required forms and choose the method of how you want your papers to be processed.

You have to download the required forms and then fill them out properly. You also have to complete the “Articles of Organization”. The next thing is to decide which method of processing do you want for your papers. Then wait for it to be processed and be approved.

3. Negotiate and execute an operating agreement.
All California LLCs are required to have an agreed upon Operating Agreement. It is important that you carry out an organizational meeting so that the agreement can be adopted. Your company has six options.

4. Submit an application for Employer Identification Number (EIN).
If you want to apply online for an EIN then you can search for the Internal Revenue Service’s website. However, you need to be knowledgeable with what you are doing because the IRS will ask significant questions about the company. This is imperative because a California LLC can be taxed in many ways.

5. Open the company’s bank account.
Once you have an EIN, you can open a bank account. This will help in distinguishing your personal money from the company’s money.

6. Obtain the necessary state business license.
Once you have completed the process then you are ready to do business. It is highly suggested to apply for the state’s business license.
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