Types of Companies > Limited Liability Company > Forming an LLC

How to form an LLC

The life of an LLC begins upon the filing of the articles of organization with the secretary of state's office. Prior to filing the articles, the following issues should be considered. Get Maryland LLC articles of organization

Where should I form the LLC?

An LLC can be formed in all states. Many people choose to form an LLC in Delaware based on its pro-business climate. Nevada has also gained popularity also due to its pro-business environment and lack of a formal information-sharing agreement with the IRS. Neither Delaware nor Nevada have corporate income taxes, and business filings in these states can usually be performed more quickly than in other states.
Many people also choose to form LLCs in their home state. This may save you money because the LLC will not need to register as a "foreign LLC" if it does business in its home state, and there is no need to pay another person to serve as the registered agent.
If your home state has high annual LLC fees or income taxes, and your LLC does not "do business" in that state, it may be wise to form the LLC elsewhere. "Doing business" means more than just selling products or making passive investments in that state - it usually requires having an office or otherwise having an active business presence.

Choosing a name:

Generally, the name of a limited liability company must end with the words "LLC", "L.L.C.", "Limited Liability Company" or "Ltd. Liability Co." The name of a person may be used as part of the name of the limited liability company. However, a name will not be accepted if it is likely to mislead the public or if it too closely resembles the name of another LLC formed in that state.

Before you choose the name, you should do a little research to see if the name is taken. You can search yourself at Yellowpages.com, Switchboard.com or the Secretary of State of the state in which you wish to form your LLC.
If the name of the LLC is used in connection with goods or services, you may wish to consider obtaining federal trademark protection for the name. This ensures that no one else in the U.S. may use that name in connection with the same general type of goods or services (except in areas where someone else is already using that name).

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