When you think of the Sunshine State, postcard-worthy sunsets, white-sand beaches, and world renowned tourist attractions are what likely come to mind. But did you know that Florida is also a sought after location for up-and-coming entrepreneurs?
That’s right! Florida LLCs offer remote business owners a number of benefits, including no state income tax, easy maintenance, and asset protection.
In this article, you’ll learn everything you need to know when it comes to forming your Florida LLC, maintaining compliance, and opening a business bank account.
Step 1: Choose Your Florida LLC Name
First, you’ll want to choose a one-of-a-kind name for your LLC. To avoid running into trouble, you should double check to make sure it follows all of the legal requirements in the state of Florida. The following rules apply to all Florida LLC names:
- It must end with the words Limited Liability Company, Limited Company or one of its abbreviations: LLC, or L.L.C. You can also shorten the word ‘Limited’ to Ltd. and ‘Company’ to Co.
- It cannot contain any words that relate to a federal or Florida agency or organization, such as FBI, IRS, Treasury, or Florida Department of Revenue.
- It should be distinguishable from all other Florida business entities (i.e. your LLC name cannot already be used by another business). To see if your desired LLC name is available, you can perform a name search on the official Florida Division of Corporations website.
Not sure what makes a good LLC name? Here’s an example: You’re getting ready to start your online shoe business. You plan to sell high-quality sneakers and want your LLC name to incorporate your full name, Dallin Brooks.
A few options you could use are:
- Brooks Sneakers
- DB Lux Sneakers
- Dallin B. Sneakers
Pro-tip: Unlike many other states, Florida does not allow you to reserve your LLC name ahead of time. To ensure your name is not taken, you’ll want to register it by filing your Articles of Organization (you’ll learn more about this document later on in step #4) ASAP.
Step 2: Select Your Florida Business Address
Next, you’ll need to decide what business address to use for your Florida LLC. A business address indicates your official place of business and will be listed on paperwork and other documentation. Thanks to Florida’s Sunshine Law, created to promote transparency between the government and its constituents, this information will be made public for anyone to access or search.
So, what does that mean for you?
Don't use your home address as your business address
If you’re thinking of using your home address for your Florida LLC, you may want to reconsider. Although it’s free and convenient, using your home address creates a major breach of privacy for you and your business. Your business address will be listed for customers, clients, and vendors to reach out to you. If you were to use your personal home address as your dedicated business address… well, let’s just say that’s a lot of people knowing where you live!
Imagine getting 20 orders in your first week of business. Great news! However, this means that those 20 customers now have access to your home address, and that number will continue to grow in the weeks, months, and years to come. Now, picture 10, 20, 30, etc. disgruntled customer showing up at your front door demanding a return or exchange. That’s not safe, nor does it help you run your remote business!
Choosing not to get a separate business address can also diminish customer trust. Think of a customer searching for your business on Google. At first glance, they’ll notice that your home address is listed and begin to question your credibility. As a high-end shoe brand, this is not the image you’re striving for. You want customers to have trust in your business, and a home address fails to convey that message.
Virtual offices offer business amenities without the rent
A virtual office provides you with a receptionist, phone number, print facilities, and other business services. Some virtual offices even offer rentable conference rooms and other in-person meeting spaces. If you’re looking to get as close to the in-office experience as possible without the high price tag of a leased office space, a virtual office may be a good fit for you.
The downside is that you don’t get a physical space to work out of on a daily basis. But as a remote business owner, you probably don’t need the space at this stage anyway.
But what if you don’t need the extra business services and conference rooms? How do you get a more flexible business address that will protect your privacy and give your business a professional business image?
Virtual mailboxes offer privacy protection and mail services
With a virtual mailbox, you’ll get a commercial business address that you can use for business-related purposes, including paperwork and customer/client communications. You won't have to worry about updating paperwork when you move, since your new address will be permanent. Best of all, you’ll be able to protect your privacy.
Because your online sneaker store doesn’t have a brick-and-mortar location for customers to visit, a commercial business address goes a long way in building a professional image for your luxury brand. You’ll also be able to manage your mail and packages 24/7 from any device, and have your mail scanned, forwarded, or destroyed, all at the touch of a button. It doesn’t get much more convenient than that!
Pro-tip: PO Boxes are not acceptable business addresses when it comes to registering your Florida LLC, so you can skip this step altogether.
Step 3: Assign Your Florida Registered Agent
A registered agent is a business or individual who will accept service of process and other legal documents, including tax forms, on behalf of your LLC. Your registered agent will be the main contact between your LLC and the state of Florida.
It is required by law that your LLC assigns and maintains a registered agent. Failing to do so can result in fines, loss of your ‘good standing’ status, and even risk shutting down your business. You’ve worked too hard to let that happen!
Florida Registered Agent Rules
In order to be a registered agent in the state of Florida, the following criteria must be met:
- You must have a physical address in the state you’re conducting business (PO Boxes are not permitted).
- You need to be available to accept service of process and other legal documents during normal business hours.
- You should be familiar with compliance processes.
When it comes to choosing a registered agent, most pick one of two options: being their own registered agent (a tricky and often complicated process) or hiring a commercial registered agent (a much better choice).
Should I be my own registered agent?
You can act as your own registered agent if you wish to do so; however, it may not be in your best interests. You’ll need to be available to accept service of process during business hours, which is a major inconvenience for most business owners. You will also need to keep track of important due dates for annual reports and other paperwork. Failing to file your annual reports in a time-sensitive manner can result in fines and other legal complications.
Using a registered agent service can prove to be beneficial
Though being your own registered agent might seem like an appealing option, it can potentially cause you unnecessary stress. Because of this, many remote business owners opt to hire a registered agent service. Doing so can help alleviate the pressure of having to maintain compliance and be fully available during working hours.
Privacy protection is another major reason why commercial registered agents are a popular choice. The state of Florida requires the names and addresses of registered agents to be made public. However, if you hire a registered agent service, they can use their address in place of yours.
Wondering how you can get a free registered agent, save over $100 a year, and keep your home address private? It’s easy – just sign up for one of VPM’s supported virtual mailbox plans and get a registered agent for no extra charge!
Step 4: File Your Florida Articles of Organization
Before your online business can begin operating, you’ll need to file your Articles of Organization with the state of Florida. Your Articles of Organization are legal documents that outline key details of your LLC. They confirm your LLC’s existence, so they’re kind of a big deal!
What information do I need to include in my Articles of Organization?
Your Articles of Organization should cover all of the basics pertaining to your LLC. Here’s the information you’ll need to get started:
- Your LLC’s name. This should end with Limited Liability Company, LLC, or L.L.C..
- Your LLC’s principal and mailing address. Your principal address is the location at which you keep official company records. If you prefer not to use your home address, a VPM virtual mailbox can provide you with a commercial mailing address (mentioned in step #2).
- Your registered agent’s name, address, and signature. When you sign up for a VPM business address, you’ll get a FREE registered agent (mentioned in step #3).
If at any point in time these details change, you can amend your Articles of Organization by filing the Articles of Amendment to Articles of Organization along with a $25 filing fee.
How do I file my Articles of Organization?
You can file your Articles of Organization online (the fastest way) or by mail. Here’s how to get started:
- Navigate to the official Florida Sunbiz website.
- For those filing online: Click on ‘Start new filing’ and complete the application.
- For those filing via mail: Download the Articles of Organization PDF form and mail it to the New Filing Section of the Division of Corporations.
Regardless of how you decide to file your Articles of Organization, you’ll be responsible for paying a one-time filing fee of $125.
Step 5: Create Your Operating Agreement
Although an operating agreement is not a requirement for your Florida LLC, drafting one is recommended. Once your LLC’s operating agreement is completed and signed, it should be stored in your business’s internal files for safekeeping.
What is an operating agreement?
An operating agreement is a document that sets forth rules regarding the structure and ownership of your LLC, as well as important financial details. Think of it as an instruction manual for your remote business.
- It details the operational procedures to be followed by the business. This can help prevent disputes between LLC members regarding finances, duties, or rights.
- It provides an extra layer of asset protection. An operating agreement helps establish separation between your personal assets and your business for both liability and tax purposes.
- It sets rules on how ownership can be sold or purchased.
Pro-tip: There will be overlap between your Articles of Organization and operating agreement, so it’s helpful to have it on hand when drafting this document.
Step 6: Obtain an EIN Number
You’ll need to get an Employee Identification Number (EIN). An EIN is a unique, nine-digit number that won't expire and is used for tax identification purposes. This should be done as soon as your Florida LLC is processed and approved (i.e. when you submit your Articles of Organization).
If you already have a Social Security Number (SSN) or Individual Taxpayer Identification Number (ITIN), the process can be completed online (the easiest and quickest way) through the IRS website.
In the event that you don’t have a SSN or ITIN, you will need to fill out the SS-4 form and submit it via fax or mail.
Need a step-by-step walkthrough of how to fill out the EIN online or the SS-4 form? You may find VPM’s EIN video course useful!
How to Get an EIN From Outside the US
If you live overseas and don’t have a SSN or ITIN, you can apply for an EIN by calling 267-941-1099 between the hours of 6AM and 11PM (EST) Monday through Friday.
Step 7: Open a Business Bank Account
You’re almost done! Your last step is to open your business bank account. This is a vital component to maintaining your Florida LLC. There are several reasons you should have one:
- It allows you to keep track of business expenses.
- It protects your identity (without a separate business bank account, you’ll have to use your SSN on documents which risks your personal and business information).
- It simplifies tax reporting.
What documents do I need to open a business bank account?
Most financial institutions will require you to supply a copy of the following in order to open a business bank account:
- Your LLC’s Articles of Organization.
- Your LLC’s operating agreement.
- Your federal tax ID number (EIN).
- A physical business address that your business is operating out of (PO Boxes are not accepted). Some banks may require you to provide proof of address to certify your occupancy.
- A mailing address where your mail, invoices, and billing will be sent.
- A valid ID of the company owners and/or members.
You should already have these completed and ready, since they are requirements for registering a Florida LLC.
How to Get a Business Bank Account From Outside the US
As of 2020, internationals can now open a business bank account online through Mercury. In order to get started, you’ll need:
- A valid passport.
- An employee identification number (you can obtain this over the phone).
- A physical address for proof of address.
If you need proof of address to open your business bank account, VPM’s TruLease plan can provide you with a physical business address backed by a lease agreement.
Step 8: File Your Annual Reports
Congratulations on forming your Florida LLC! You’ll need to make sure you file your annual reports each year. These ensure that your LLC is still active and prevents it from being suspended, dissolved, or shut down.
Your annual reports should contain basic details about your LLC, including your business address, registered agent, and information regarding the products or services you offer.
When you file online, you’ll need to pay a filing fee of $138.75. Your annual reports must be filed by May 1st of every year, or you’ll be responsible for paying a late penalty fee amount to $400.
Pro-tip: Set a reminder on your Google calendar so you are aware of important due dates, like when your annual reports are due, well in advance.
Forming a Florida LLC may sound intimidating, but it’s really quite simple. Once you’ve got the basics down (i.e. choosing a name, selecting a business address, assigning your registered agent, and filing your Articles of Organization), you can move on to the final steps.
Obtaining an EIN is free and easy, and should be done as soon as you’ve created your operating agreement. The importance of keeping your personal and business assets separate cannot be overstated, so you’ll want to be sure to open your business bank account STAT. And of course, don’t forget your annual reports!
Get a Florida Business Address to Complete Your LLC
Looking for that extra layer of anonymity for your remote business? Skip using your home address on documents and get a Florida business address today. In addition to your new commercial address, you’ll be provided with a virtual mailbox that’ll allow you to manage your mail and packages digitally 24/7.
You won't have to list your home address on documentation, your website, or other forms of correspondence ever again. Get your Florida business address today – you’ll thank yourself later!