Have you decided to seek professional help to form an LLC to start your business? In addition to forming an LLC, consider the following things to protect your new business.
Get An Employee Identification Number
Your LLC is going to need an employee identification number, often referred to as an EIN. This will allow you to get started on a lot of the financial aspects of starting up your LLC and is necessary for any LLC to pay taxes. This is true even if your LLC is run by you alone and you do not have any employees.
Draft Your Operating Agreement
The next thing you should do is draft a basic operating agreement, which will help protect you if your LLC were to get sued. The operating agreement states provisions and regulations that you agree to follow as part of running the business, which extends to working relationships between managers and employees, as well as guidelines for how finances are handled. Having this operating agreement in place protects you because you can show how your company operates and what guidelines you are following.
Open A Bank Account
Switching from a sole proprietorship to an LLC means that you are going to have to change the way that you handle your banking. You'll need a separate bank account for your LLC so that you can transfer funds from your personal business account to the LLC's bank account. This will keep all of your finances separated and help protect your personal finances since the two will no longer be mixed.
Apply For Business Licenses
You are going to have to apply for the appropriate business licenses in your area to run your LLC. Every type of business is different and requires their own licenses, so make sure you do your research. For example, if you are opening a liquor store, you'll need to acquire a liquor license in order to sell that type of product.
Update Contracts With Vendors
If you previously had contracts with your vendors when you were operating as a sole proprietorship, you'll need to update all your contracts with existing vendors. This will help ensure that the contract is now with the vendor and the LLC and not you personally. This should not be a problem with most vendors, since it is a normal part of running a small business that they have likely done in the past.
For more information on LLC formation services, contact a local business.