Our Step By Step Guide

How to Form a limited liability company In North Carolina

Forming a limited liability company provides liability protection for any type of business, and should be among the first steps you take as a new business owner. Starting a limited liability company can help you protect your personal assets while adding legitimacy to your company. Follow our step by step guide or let us handle the paperwork on your behalf, ensuring your business is filed quickly and accurately.

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Why start your business in North Carolina?

Did you know North Carolina has the best business climate in the United States? It's true! The Tar Heel State also has a reputation for its tax friendliness, with a 3% corporate tax rate that makes it the lowest in the country. The state also ranks high for its assess to small business capital and highly educated workforce. In 2018, the city of Raleigh was even nominated as a finalist as Amazon conducted a nationwide search for their next HQ2 headquarters.

With all this positive buzz and benefits, it's not surprising to see why entrepreneurs want to form an LLC in North Carolina. Let's help you get started by following this simple step-by-step guide.

Two Ways to Register Your Business

MyCorporation® can help you file all of the necessary documents to form your limited liability company in North Carolina.

File and submit the formation paperwork yourself

Our free guide provides you with all of the information you'll need to form your limited liability company in North Carolina. Bookmark this page as a reference so you can return easily as you complete each step of the process.

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Let MyCorporation handle the formation process for you.

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Are you looking for another entity type? We offer several other guides for the state of North Carolina.

One of the first decisions you'll need to make as a new business owner is which type of entity you will form for your business. While each business type offers its own benefits, forming an LLC (limited liability company) is one of the most popular choices made by new business owners across the United States. An LLC is a relatively new type of legal business formation, considered a hybrid entity, combining the pass-through taxation and simple operation of sole proprietorship with the limited liability protection provided by a corporation.

One of the main reasons for the growing popularity of the LLC in North Carolina is its simple setup and flexible structure. An LLC is also considered the easiest type of entity to maintain with the least number of annual requirements. Plus, income from the business is passed directly to its owners as regular income, making taxes much easier for an LLC, which can help you lowering your tax preparation costs each year.

The Benefits of an LLC

  • Protect your Personal Assets
    Starting a business designates your business as a separate legal entity, preventing you from being personally responsible for the debts of your business.
  • Build Credibility
    Establishing a professional identity provides the benefit of showing potential customers and investors that your business is legitimate and here to stay.
  • Simple Management
    Limited liability companies are less formal and require fewer annual / maintenance requirements than other common entity types, making it a popular choice for small business owners.

Compare the main entity types below

Entity Type
Liability
Taxation
Maintenance
Limited Liability Company Combines limited liability protection with a pass-through tax structure. IRS rules allow LLCs to choose between being taxed as partnership or corporation. The easiest entity to maintain with the least amount of formal annual requirements.
Corporation Owners / shareholders have limited personal liability for business related debts. Separate taxable entity, corporate profits among owners and corporation. Meetings are required to maintain corporate status. Stock may be sold to raise capital.
Non-Profit Corporation A corporation formed for a charitable, educational, religious, literary, or scientic purpose. Contributions to charitable corporation are tax-deductible. Can get tax exempt status with the IRS. Annual reports, minutes, meetings are required to maintain nonprofit / tax exempt status.
Tip: Try our free entity choice tool. Answer a few simple multiple choice questions about your business, and our tool can recommend the entity type that best fits the needs of your business.

The next step will be to decide on a name for your business. Choose a name that is memorable and unique, easy to understand and pronounce, and accurately represents your business. You'll want to search your name choices on the web to quickly find out if they are already taken. It's also best to jot down one or two alternatives, in case the name you settle on is not available for registration in North Carolina.

There are a few rules that North Carolina Limited Liability Companies must follow in order to register a name.

  • The name you choose must be unique and not "confusingly similar" to the name of any other North Carolina business. This is to prevent fraud or misrepresentation and is a common rule in all 50 states. You can find out whether a name is available by conducting a business entity name search through the North Carolina Secretary of State for possible conflicts. Be sure to check variations or alternate spellings as well, otherwise your filing may be rejected. In a pinch, you can use MyCorporation's business name search service, where we will conduct a more thorough search on your behalf and report back our findings.
  • Your business name must include the words "Limited Liability Company," or "LLC."

You can learn more about North Carolina business name registration rules and regulations through the North Carolina Secretary of State.

Tip: A business name check is included with every one of our business formation packages. We check with the state to determine the availability of your business name automatically. You can also conduct a nationwide business name search here.

There are two options to choose from when it comes to setting up your limited liability company in North Carolina. "Member managed" or "manager managed". The first thing you need to know is that owners of any LLC are referred to as "members". A single member LLC has just one owner, while a multi-member LLC is an LLC owned by 2 or more members. Pretty simple, right?

North Carolina LLCs also must also designate one or more individuals to manage the day to day operations of the business. This can be handled by one of the members of the business (member managed, the most popular choice and the default in most states), or a professional manager appointed by the members to act on their behalf (manager managed).

While the differences are subtle, what you really need to know is that each member in a member managed LLC has the power to make decisions for the business. However, in a manager managed LLC, the members choose who will manage the business and relinquish all of the decision making to the manager chosen. The person chosen can be one of the members of the business as well, or it can be someone else entirely.

Most states require that you designate a registered agent for your business, and North Carolina is no exception. A registered agent acts as the state's means to communicate with a business and is responsible for receiving legal and official documents related to the business.

A registered agent can be anyone you wish, with one small caveat. The registered agent must have a physical address in North Carolina. In other words, a P.O. Box is not allowed as a registered agent address. This means a member of the limited liability company can act as the registered agent if desired, or a third-party registered agent service like MyCorporation can be used.

Why designate a third party to act as my registered agent?

It should be noted that registered agent information is made publicly available. This can cause privacy concerns for business owners who do not wish to list their personal contact information on the internet for everyone to see. It is also common for the registered agent to become a target of spam or robocalls since this private information is relatively easy to obtain. Another issue that may arise is that in the case of a lawsuit, these documents would be hand delivered directly to the registered agent, and in the case that you used your business location for this purpose, this could occur in front of your customers. This is why many business owners opt for a third-party registered agent service such as MyCorporation to act as a registered agent on behalf of their business.

Another issue that may arise is that in the case of a lawsuit, these documents would be hand delivered directly to the registered agent. In the case that you used your business location for this purpose, this could occur in front of your customers. This is why many business owners opt for a third-party registered agent service such as MyCorporation to act as a registered agent on behalf of their business.

Tip: Our Deluxe and Premium formation packages include a full year of registered agent services for your business. We also offer standalone registered agent services which you can add to your business later.

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MyCorporation® takes the guess work out of starting your business. Answer a few simple questions, and our filing experts will take care of the rest.

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The state of North Carolina requires you to file Articles of Organization to order to form an LLC. Articles of Organization may be filed online or by mail. They include basic information about the North Carolina LLC including the company name, business address, mailing address, registered agent name and address, the LLC's purpose, effective date of the LLC, and signature of at least one individual acting as an authorized representative. The filing fee is $125 and must be included with your application.

What information should be included in the Articles of Organization?

As noted above, information required in the Articles of Organization covers basic information as it pertains to the North Carolina LLC.

After formation, the state of North Carolina requires an LLC to create an operating agreement. This agreement needs to be written, and should be kept with the company's records. In order to open a bank account for your business, you will often be required to submit both your operating agreement, and your EIN number.

What kind of information needs to be included in a North Carolina operating agreement?

Operating agreements are required in North Carolina and are important to laying the foundation of a properly run business. An operating agreement sets guidelines for the way your business operates now and into the future. Common details in an operating agreement include the following:

  • Basic contact details: The name of the LLC, the address of the principal business location and often, the registered agent address.
  • The business purpose: This is a basic one sentence description of what kind of business your LLC will do, and is often a very general description, which creates a bit more flexibility as the business matures.
  • Tax structure: Often this indicates the way the LLC will choose to be taxed. The main options are to be taxed as a sole proprietor or a partnership ( both pass through options ) or to be taxed as a corporation ( which requires an S Corp Election to be filed )
  • Ownership and management: This section lays out the general rules about how the business will operate day to day. This refers to step 3, where you determined whether your business would be "manager managed" or "member managed". As mentioned before, member managed is the default and the most common choice. If you are unsure, member managed is a pretty safe bet.
Tip: All of our formation packages include a sample operating agreement you can use directly, or modify to fit your needs. Start Now

According to the Economic Development Partnership of North Carolina, the state of North Carolina does not issue a single business license.

However, that does not mean your North Carolina LLC does not need to apply for relevant licenses and permits. It is advised that you reach out to the North Carolina Secretary of State or call the Business Link North Carolina team for more information on licenses. They will be able to better determine your business license needs at a state, city, county, and federal level. In a pinch, you may also use MyCorporation's business license compliance package. Our skilled professionals will do the work for you. We identify all of the licenses required by your business and provide you with the information you need in order to file.

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MyCorporation® takes the guess work out of starting your business. Answer a few simple questions, and our filing experts will take care of the rest.

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An EIN (also called a Federal Tax Id) is a nine-digit number that is issued by the IRS and used to uniquely identify your business for tax purposes. Think of it as a Social Security Number (SSN) for your business, except an EIN is far less sensitive. It is important to wait until the LLC has been approved by the state before applying, and for that reason, filing for an EIN is one of the last things to do when you are setting up a business.

Like a social security number, the EIN allows you to:

  • Open business checking, savings, or investment accounts
  • File taxes for the business
  • Complete payroll for employees if applicable
  • Obtain lines of credit and credit cards, as well as "build credit" for your business
  • Apply for applicable business licenses when required.

You only need a few pieces of information to file including your mailing address and legal business name. You can apply online with the IRS by downloading IRS Form SS-4, or work alongside a third party organization like MyCorporation to complete an EIN application.

limited liability company Formation Packages

Save money and simplify the process of starting your business by bundling the services you need with our business formation packages.

BASICS
$99
  • Articles of Organization
  • Name Availability Search
  • Minutes & Membership Certificates
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STANDARD
$124
  • Articles of Organization
  • Name Availability Search
  • Minutes & Membership Certificates
  • Annual Report service
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DELUXE
$224
  • Articles of Organization
  • Name Availability Search
  • Minutes & Membership Certificates
  • Annual Report service
  • Registered Agent services
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Frequently asked questions

In North Carolina, if your profession requires state licensing, you would incorporate your business as a Professional Service Limited Liability Company (PLLC). This often includes doctors, lawyers, therapists, and other professions where state licensure is required.

A PLLC is different than a Professional Corporation (PC), which consists of shareholders that own company stock and has different tax implications. North Carolina allows licensed professionals the opportunity to form both a PLLC and PC, if desired. PLLCs are usually more popular, as they require less effort to build and operate.

Generally, this can include the following professions:

  • Accounting
  • Acupuncture
  • Architecture
  • Chiropractic
  • Clinical social work
  • Dentistry
  • Law
  • Marriage, family, and child counseling
  • Medicine
  • Speech-language pathology and audiology
  • Nursing
  • Optometry
  • Osteopathy
  • Pharmacy
  • Physical therapy
  • Physician assistants
  • Podiatry
  • Psychology
  • Shorthand court reporters

According to the State of North Carolina, you must wait 5 to 7 business days to receive a follow-up email about the status of online LLC filings. Check in with North Carolina's Secretary of State for further updates on document processing dates

North Carolina LLCs are required to file an annual report. The deadline varies for each entity, but LLC annual reports are due on April 15th. The filing fee varies depending whether you file online or through the mail. Online filing fees are $202 and paper fees are $200.

In order to form an LLC in Florida, you will be required to pay various fees for services. The breakdown of the required fees is as follows:

  • Filing Fee - $100
  • Registered Agent Designation - $25
  • Certified Copy - $30
  • Certificate of Status - $5

In total, expect to set aside at least $160 to form an LLC in Florida.

Businesses organized in other states can foreign qualify to conduct business in Florida. Follow the instructions in the Florida Department of State's application to request for a foreign Corporation to transact business in Florida. Check in with the Florida Department of State for the correct filing fee with your application.