Connecticut LLC
Forming a Limited Liability Company (LLC) in Connecticut offers entrepreneurs a mix of flexibility, limited liability protection, and potential tax advantages. This guide will lead you through the process of establishing an LLC in Connecticut, detailing necessary steps, state fees, and tax obligations.
1. Choosing a Name for Your LLC
- Name Requirements: The name must be unique and distinguishable from other business names in Connecticut. It must include “Limited Liability Company” or its abbreviations (LLC or L.L.C.).
- Name Search: Use the Connecticut Secretary of State’s Business Query tool to check name availability.
- Name Reservation: Optional, but you can reserve your business name for 120 days for a $60 fee.
2. Appointing a Registered Agent
- Requirement: Connecticut law requires that your LLC has a registered agent with a physical address in the state.
- Role: The registered agent receives legal documents and government notices on behalf of the LLC.
3. Filing the Certificate of Organization
- Document Submission: File a Certificate of Organization with the Connecticut Secretary of State.
- Included Information: Your LLC’s name, registered agent details, and whether it’s member-managed or manager-managed.
- Filing Fee: The fee is $120, and it can be done online or by mail.
4. Creating an Operating Agreement
- Importance: Although not required by Connecticut law, an operating agreement is recommended to outline ownership and operational procedures.
- Function: It provides a clear framework for the operation of your LLC and helps maintain your liability protection.
5. Obtaining an Employer Identification Number (EIN)
- For Tax and Banking Purposes: Necessary if your LLC has more than one member or if you plan to have employees.
- Cost: Free to obtain from the IRS, either online or by mail.
6. Understanding Connecticut State Taxes
- Business Entity Tax: Connecticut imposes a biennial Business Entity Tax of $250 on all LLCs.
- Sales Tax: If selling goods or certain services, register for Connecticut Sales and Use Tax.
7. Local Compliance and Licensing
- Business Licenses: Depending on your business type and location, you may need local or state business licenses.
- Professional Licenses: Certain professions require state-specific licensing.
8. Opening a Business Bank Account
- Separation of Assets: Essential for maintaining personal liability protection.
- Requirements: Typically requires your EIN and Certificate of Organization.
- Banks: You can choose between local, international o digital banks.
9. Annual Report and Compliance
- Annual Report: Connecticut LLCs are required to file an Annual Report with the Secretary of State.
- Filing Fee: The annual report fee is $80.
10. Maintaining Good Standing
- Record-Keeping: Keep detailed records of all business dealings.
- Stay Updated: Be aware of changes in Connecticut laws that could affect your LLC.
Conclusion
Forming an LLC in Connecticut is a process that requires careful planning and adherence to state-specific regulations. While this guide provides an overview, consulting with legal professionals or the Connecticut Secretary of State is advisable for personalized guidance. Proper adherence to these steps will help ensure the successful formation and ongoing operation of your LLC in Connecticut.