Business Formation Templates

To form an LLC, you need: (1) Articles of Organization (called a Certificate of Formation in some states), which is filed with your state's Secretary of State; (2) an LLC Operating Agreement, which governs how the company is managed internally; (3) an EIN from the IRS for tax filing and opening a bank account; and (4) a registered agent designation, a person or service authorized to receive legal documents on behalf of your LLC. While only the Articles of Organization are legally required to create the LLC, operating without an operating agreement leaves you subject to state default rules and weakens your liability protection.

An LLC operating agreement is an internal document that outlines how your LLC is managed and operated. It covers ownership percentages, profit and loss allocation, voting rights, management structure (member-managed vs. manager-managed), capital contributions, transfer restrictions, and dissolution procedures. While not all states legally require an operating agreement, having one is critical because it: (1) protects your limited liability status by demonstrating the LLC is a separate entity; (2) prevents state default rules from governing your business; and (3) resolves disputes by providing a clear framework agreed upon by all members.

State filing fees for an LLC range from $50 to $500 depending on the state, for example, Kentucky charges $40, while California charges $70 plus an $800 annual franchise tax. If you hire a lawyer for formation, expect to pay $500 to $2,000 on top of filing fees. Additional costs may include registered agent services ($50-$300/year), an EIN application (free from the IRS), and business licenses ($50-$400 depending on location and industry). Legal Tank's free templates eliminate attorney fees, saving you $500 to $2,000 on formation documents alone.

An LLC (Limited Liability Company) offers flexible management, pass-through taxation by default, and fewer formalities. A corporation has a more rigid structure with a board of directors, officers, and shareholders, and is subject to double taxation (corporate tax plus dividend tax) unless it elects S-corp status. LLCs are generally better for small businesses and startups due to their simplicity, while corporations are preferred for businesses that plan to raise venture capital, issue stock options, or go public. Both provide limited liability protection for their owners.

Yes, every LLC and corporation is required to designate a registered agent in the state where it is formed and in every state where it is registered to do business. The registered agent is a person or company authorized to receive official legal documents, tax notices, and government correspondence on behalf of your business. You can serve as your own registered agent in most states, but many business owners prefer to use a professional registered agent service ($50-$300/year) for privacy, reliability, and convenience, especially if they operate in multiple states.