How to Start an LLC in Georgia
- Why Start a Business in Georgia?
- 1. Business-Friendly Environment
- 2. Supportive Communities
- 3. Differential Economies
- 4. Access to Capital
- 5. Good Income
- Why Start an LLC in Georgia
- How to Start an LLC in Georgia
- Step 1 – Name your LLC
- Step 2 – Find a Registered Agent
- Step 3 – Submit Articles of Organization
- Step 4 – Operating Agreement
- Step 5 – Employee Identification Number
- Step 6 – Run your Business
- How Much Does it Cost to Start an LLC in Georgia?
- What are the Taxes in Georgia Like?
- What is the Filing Times for an LLC in Georgia?
- Final Word: How to Start an LLC in Georgia
Georgia is a great location for those looking to start a business. And one option for business formation is the LLC model. In this article, we will teach you how to start an LLC in Georgia and give some general advice.
Why Start a Business in Georgia?
There are numerous reasons why you would want to start a business in Georgia. These include the following benefits.
1. Business-Friendly Environment
The first, and most important aspect, is that the state has business-friendly legislation and taxes. The tax rate is very similar to the rates that an individual would have to pay, making you more personally wealthy than you would be in other states. There are also other aspects to consider however when choosing a pricing model as there are state sales tax, local sales tax and federal taxes.
2. Supportive Communities
Georgia is known to be very supportive of businesses. There are lots of networking opportunities, these can help connect entrepreneurs with potential customers, mentors, and funding sources. There are also start-up groups.
3. Differential Economies
Georgia has a very diverse geography. Therefore, the state has been able to develop a very robust, varied economy. There are opportunities in agriculture, aerospace, information technology, energy, logistics, and others. And the state is well-known to be an affordable location to start a business.
4. Access to Capital
There are numerous ways that you can fund your new business venture. However, the state is one of the best options as there are lots of options to help finance new businesses in the area. There is a great angel investor community, there are also state grants and more. The labor market is also very competitive and there are great opportunities to bring new skills to the state.
5. Good Income
Another benefit is that those in Georgia have a relatively high disposable income. Therefore, for those who are looking for a good market, Georgia is one of the best. Another advantage of the customer base in the state is that it has one of the highest populations for states, with more than 10 million in the state who might want to purchase from your business.
Why Start an LLC in Georgia
There are lots of options when it comes to creating a business. However, starting an LLC is one of the best options for your business. For one, the LLC business model allows the owner of the business to be taxed at a rate that is almost the same as on a personal level. Therefore, you can get the same wealth.
In addition, when you have an LLC, your business name is protected by law. Therefore, no other business can use your name in the state. If they do use your name, you can take them to court and you will be able to win.
Another benefit is that you can protect your personal assets. If your business goes into debt and the creditors try to collect assets to cover them, then they can’t take assets not owned by the business.
You will also find it easier to get funding for your business. Lenders will offer better terms as you will be seen as less risky and you will get better rates from creditors for supplies. Finally, an LLC will find it easier to open a bank account.
The costs of running a business in the state are also better. For comparison, here is a table comparing the formation of an LLC to other nearby states, and the average for the US.
|State||LLC Filing Fee||LLC Annual/Biennial Fee||Corporate Tax Rate||Nominal GDP per capita|
|Georgia||$100||$50 (every year)||5.75%||$63,271|
|Florida||$125||$138.75 (every year)||5.50%||$56,301|
|Alabama||$200||$100 minimum (every year)||6.50%||$49,027|
|South Carolina||$110||$0 (no fee and no information report, unless LLC is taxed as an S-Corp )||5.00%||$52,031|
|US Average||$130.38||$89.34 (every year)||5.60%||$64,773.08|
How to Start an LLC in Georgia
Here are the steps that are required to start an LLC in Georgia.
Step 1 – Name your LLC
The first thing that you need to do in the process is to ensure that you have a name for your LLC. Your name needs to have several core principles applied to it that meet regulations. For example, your LLC name must:
- Be unique, there can be no business in the state that is registered with the same or similar name.
- Include the phrase Limited Liability Company or an abbreviation of the statement.
- Must be memorable, to help audiences find you quicker.
- Do not include prohibited or restricted words, unless you have permission.
- Your name cannot be confused with a government or state agency.
You can make sure that a name has not been taken by completing a Georgia Business Name search. And you can use a business name generator to help you come up with some unique names for your business.
The naming process can take some time. However, once you’ve found a name, you should try to reserve the name. It does cost money to reserve your business name, and that reservation will only last for so long, after which you will need to re-reserve the name.
Step 2 – Find a Registered Agent
Next, you will need to find a registered agent within the state. A registered agent is someone who can take paperwork from the government in the state. They need to have an address in the state and they need to be available during normal business hours.
A registered agent can be a person or an entity. ZenBusiness and IncFile can offer to act as your registered agent in the state. They can also help you with the entire process and they can help remind you when there are important dates such as filing returns.
Step 3 – Submit Articles of Organization
The next step is for you to fill in and file your Articles of Organization with the Transmittal Information Form with the Georgia State Secretary. The articles of organization contain your company’s basic formation information including contact details.
The documents for the organizational formation can be filed online via their website or they can be sent via mail. There is an additional $10 fee when you file by mail. For those online, you can file the articles for $100.
Step 4 – Operating Agreement
The next step is the operating agreement. This is the document that allows you to establish the business’ procedures, activities, and conduct. It is like the bylaws for the company, and it should prevent you from getting into massive disagreements when you have a debate in the business, it should detail who makes the final decision or how certain processes are completed.
It is important to note that the operating agreement is not a legal requirement. However, it will save your business a lot of hours and costs. It can also help you to legitimize your business and help when seeking funding.
Step 5 – Employee Identification Number
Now you should be applying for your Employer Identification Number, otherwise known as the EIN. This is a nine-digital number that is allotted by the Internal Revenue Service (IRS). It is used for tax purposes. It is required for all those businesses that have more than one member and also want to have employees.
To get an EIN you can apply online or via mail. It is free to get an EIN.
Step 6 – Run your Business
Once this is done, you can then run your LLC in Georgia.
How Much Does it Cost to Start an LLC in Georgia?
There are numerous costs when it comes to starting an LLC in Georgia. The annual report for a domestic LLC is $50, if you are a foreign LLC, then the cost is higher. If you submit your LLC late, there is an additional fee of $25.
There is also an online filing fee of $100. If you want to file via mail, the cost is $110. For those brands that are filing out of state, they need to pay an additional amount, making the total $225.
What are the Taxes in Georgia Like?
The taxes in the state are relatively good. LLCs in the state are taxed as if they are sole proprietorships. However, you will also need to pay income taxes and sales taxes for the business.
LLCs can also be taxed as a corporation if you want to. It is best if you speak to an accountant about what would offer the best tax burden for you and your business.
What is the Filing Times for an LLC in Georgia?
For mail filing, the filing process can take four to five weeks. This includes the 14-15 days that it takes for the forms to be completed by the state. For online filing, you can get the documents completed within 7 to 14 business days.
Final Word: How to Start an LLC in Georgia
Above are the steps required when you want to know how to start an LLC in Georgia. This list is rather quick and simple. You can get help with businesses like ZenBusiness and IncFile. These companies can act as representatives for your business in the state as well as complete the process. Starting the process is quick.