When your company is registered in the USA, it becomes a separate legal entity with its own legal requirements and is held liable for any debts incurred as a result of the operation of the business. Therefore, you are able to conduct your business without worrying about losing your personal assets, like your house, money, landed properties, etc.
Also, LLC registration in the USA allows you to issue shares and raise equity capital. This will provide you with a much-needed financial boost at the beginning of your business.
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Here are some steps to set up a company in the USA:
- Choose a name for the company - It must be unique and must be available in the US state where you want to form your company.
- Registered agent - You should have a registered agent who has a physical address in that state. They must be available during business hours to sign all the legal documents.
- Federal Employer Identification Number - You can apply for this only when you want to open a bank account in the bank of the USA.
- Certificate of Authentication – You can apply for this only when you open a bank account in your country or to provide proof that you have a company in the US. In these cases, you need to present a certificate of authentication or Apostille.
Also read: Incorporating a company in the USA
LLC legal documents
Before forming an LLC company, you should have all your LLC legal documents ready. Here are the three important LLC formation documents:
1) Articles of Organization:
These are the basic elements that are required in the Articles/Certificate of Organization:
- Business Name
- Business Purpose
- Principal Place of Business
- Registered Agent: This is the organisation or individual who will receive official paperwork and legal documents, including documents related to lawsuits, on your behalf. You should have a registered agent who has a physical address in that state. They must be available during business hours to sign all the legal documents.
- Management Structure: It will define if your LLC has a single manager, two or more managers, or all members are managers.
- Duration of LLC: Some states ask you to specify how long your LLC will operate. There are certain states that have statutory time limits (usually a few decades). If your LLC is still operating at the end of this period, you can extend it for a longer period.
2) Operating Agreement:
The rights and responsibilities of the Limited Liability Company members are stated in the Operating Agreement. Also, it explains how the LLC will distribute its profits to its members.
Although it is not legally required to file an operating agreement when forming a limited liability company, you must have one ready to meet the company's formalities.
These are the common things you must include in your Operating Agreement:
- You must explain how important business decisions will be made if there are multiple members
- Percentages of Ownership of each member
- Voting Rights
- The Distribution of Profits and Losses
- What happens if an owner passes away or leaves the company?
- How to Dissolve the LLC?
All members must sign it to make it valid.
3) Employee Identification Number:
Every US business needs an EIN (Employee Identification Number). Rather than using SSN (social security number), you must use your EIN on all business-related documents. In order to open a business bank account, you need your EIN. You can speak with your company formation agent to get an EIN.
Also, you will need to file an annual/biennial report with the state where your LLC is registered.