How Long Does It Take to Create an LLC?

By Jeff Franco J.D./M.A./M.B.A.

Most jurisdictions in the U.S. adopt some form of the Revised Uniform Limited Liability Company Act. The widespread adoption of the RULLCA has resulted in relatively uniform LLC formation requirements. The process of creating an LLC requires minimal paperwork, which enables you to set up the structure quickly. However, awareness of the requirements of your jurisdiction before initiating the process will foster quick and efficient formation.

Articles of Organization

The requirements in most jurisdictions to create an LLC begin with the drafting of articles of organization or its equivalent. Generally, you must provide the name of the LLC, its office address and the name of an agent who has authorization to accept legal service of process on behalf of the entity. Many states provide standard forms that you can fill in, print and mail to the appropriate state office. For example, the state of Delaware provides access to its two-page Certificate of Formation on its website. The LLC process can be done as quickly as you can fill out the form, attach a $90 filing fee (as of 2010) and mail it to the division’s office.

Choosing a Name

Most states require the LLC to operate under a unique business name. When choosing a name, most jurisdictions provide you with access to a searchable database of legal business names that are currently in use by other organizations. To expedite the LLC formation process, it is advisable to have alternative names chosen in the event your first choices are unavailable. To reserve a business name in New York, the state requires you to submit a Certificate of Assumed Name and remit a $25 filing fee to the NY Department of State. In contrast, the state of Delaware allows prospective LLC members to reserve a business name online prior to formal creation of the LLC by submitting a $75 fee. However, you can avoid this additional fee by choosing a name on the Certificate of Formation.

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Membership Requirements

The formation of a legal LLC entity occurs at the time the appropriate state office files the articles of organization. However, most jurisdictions will accept the articles but will not file it until at least one member of the LLC exists. Many jurisdictions will delay the filing and provide you with a period of time, generally 90 days, to provide written notification of the first member to join the LLC.

Operating Agreement

Most states do not require an LLC to draft an operating agreement. However, if the LLC has more than one member, it may behoove you to have one in place at the time of formation. The agreement can include any legal procedure that is binding on all current and future members of the LLC. Common agreement clauses address the votes necessary to admit new members and limitations on the types of transactions the LLC can enter into. In the absence of an operating agreement or unanimous member consent, the laws of the jurisdiction you create the LLC in will govern each fundamental business decision.

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