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The most straightforward business entity to set up and manage is the limited liability company (LLC). Mississippi business owners can set up their LLC in minutes. This allows them to start a legal business quickly. Many people don’t know where they should start when creating an LLC. This detailed guide will help you get your Mississippi LLC started.
Setting up an LLC in Mississippi is worth it
An LLC, other than a sole proprietorship is the easiest business entity to create. An LLC is simpler than more complex structures such as corporations and partnerships. It doesn’t have many tax implications or regulations. This business model is popular among startups because it’s easy to set up and maintain.
Most states make it easy to form an LLC. Mississippi is no exception. On the Mississippi Secretary Of State website, you can register, renew and pay all fees for your LLC.
An LLC offers many benefits to companies. For example, it is a pass-through entity that prevents you and your shareholders from being taxed on income or dividends. An LLC allows you to keep your business and personal assets separated, which gives you protection over your cash flow and assets in the event of legal problems.
Mississippi is also one of the most affordable states to set up an LLC. The state currently requires that a $50 filing fee be paid for the initial setup. There are no annual or biannual fees. This is a great deal compared to California, where LLCs must pay an annual $800 fee in addition to the initial $70 filing fee.
How much investment is required to start an LLC in Mississippi
The LLC structure is simple and you won’t have to worry about whether it will delay your business’s launch or impact your budget. You can file your LLC online by filling out a questionnaire that collects all the information you need to legally set up your business.
Mississippi business owners can easily form their company with a $50 filing fee. There are no annual and biannual LLC fees that you need to be concerned about. A $25 fee will be required to reserve your business name. You should also budget between $99 and $300 per year for registered agent services, which Mississippi requires LLCs to have. Your LLC’s annual filing fee is $25.
If you are unsure whether to file with Incfile, it is possible to save time and money. Incfile charges the Mississippi filing fee only for its basic Silver plan. This includes filing your Articles of Organization, unlimited business name searches, and preparing them. A registered agent service will be provided for one year free of charge, which can help you save some startup costs.
Six Steps to Starting an LLC in Mississippi
Find below a step–by–step guide for starting an LLC in Mississippi.
#1 – Choose your Business Name
When you file your LLC, you will need a name. So it is important to get your business name set up. Begin by brainstorming a few business names that you like. Mississippi law requires LLCs to include Limited Liability Company (LLC) or L.L.C. LLCs must include Limited Liability Company, LLC or L.L.C. in their business names. Make sure that the name you choose works well with this addition.
Once you have a list of possible name candidates, go to the Mississippi Secretary Of State website to perform a name search. This free tool allows you to search for business names in Mississippi. It will ensure that your business has a unique name. Mississippi does not permit duplicate business names, or names that could be mistaken for an existing company.
Mississippi’s LLCs cannot include the name of any member or manager, or any words that could be confused with the type of business it is like partnership or corporation.
We recommend taking some steps before you decide on your business name. To ensure that your business name, or a portion thereof, is not already trademarked, first search the United States Patent and Trademark Office. This will help you avoid legal trouble later.
You can also check to see whether a domain name may be available for your business names. Long names can become lengthy domain names. This can make it difficult for people to remember. Shorter names may be already used for domains. Before you file the name with the state, check with a domain registry to verify that your business name is still available.
#2 – Create an LLC Structure
The next step is to legalize your LLC by filing the papers. You will first need to name a registered representative. Mississippi requires that you have a registered agent to receive business communications regarding your LLC. You’ll need one when you file for LLC incorporation.
You have two options: search on your own for a Mississippi registered agent or hire a service like Infile that will provide the service. While most registered agents charge $50 to register, it is more common to pay $99-$300 per year.
For the first year, Incfile users will receive a free registered agent service. The service is $119 per year after that.
You can file your LLC papers online via the Mississippi Secretary Of State website portal. Register for an account to gain access to the portal. You can choose your business entity, register your company name, and file your papers. You will be notified by the state when your filing has been accepted. Reminders will also be sent to you via your portal account when it is time to renew.
Although filing LLC papers is not difficult, it can be a headache if you hire an experienced company to do it. In file makes it simple to create your Mississippi business according to the guidelines within minutes.
Incfile offers three plans. Silver is free, gold costs $202, and platinum $352 plus state filing fees. With Silver, you’ll receive basic preparation and filing as well as unlimited name searches and the free registered agent service.
Gold includes a free operating agreement and business banking account setup. A business tax consultation is included. An online dashboard is also available. Platinum includes expedited filing, business contract templates, and a domain.
Incfile is a great service that walks you through every step. Notifications about your business will be sent to you, such as when your annual report is due or when your business licenses are due.
#3 – Apply for an Employer Identification Number.
An EIN is a federal tax identification that businesses use. It functions in the same way as a person’s Social Security Number to identify the company for legal and tax purposes.
An EIN is not required for single-member LLCs unless there are plans to have employees or to be taxed more like a corporation than a sole proprietorship. EINs for multi-member LLCs must be obtained in each state.
Even though you don’t have to obtain an EIN, it is worth considering. You will need an EIN to place your Social Security number on business documents. This exposes it to clients, vendors, and other business contacts. Your Social Security number is protected with an EIN. An EIN is also required if you plan to hire staff in the future or open a bank account for your business.
Incfile is one of the business entity services that charge a fee to obtain an EIN. An EIN does not require you to pay a fee. To obtain one, go to the IRS website. Then complete the application. It’s easy and quick.
To easily add an EIN to your documents, you should apply for it along with your business papers. You’ll have to amend your documents later.
#4 – Create an Operating Agreement
Mississippi doesn’t require operating agreements to be filed or developed by LLCs. It’s still a good idea if you have other members in your LLC to have an operating agreement.
An operating agreement contains important information about your company, including who is involved and the policies. These are the main points that you should include in your operating agreements:
- Contact information and names of each member
- What does each member do in your LLC?
- The rights and responsibilities of each member, including the owner
- Policy and rules for the admission of new members
- Business meeting and note-taking rules
- Your business’s purpose
- Member voting powers
- How profits and losses are split
- How the members will resolve any issues that may arise in the business
- Dissolution procedures
This information is important. It proves that your LLC can be legally operated independently of you. The operating agreement is important if you are involved in legal matters. It shows that your business model is well-thought-out and should be treated as an independent entity. It can also help you plan for the future and mitigate risk.
Online, you can download free operating agreements to help you create your own. If you are already using Incfile’s Gold and Platinum plans, you can use the service to help you complete and file your operating agreements.
#5 – Open a Business Bank Account
Mississippi doesn’t require you to have a business bank account for your LLC, just like an operating agreement. It’s still something that can help your business run more smoothly.
If you’re an accountant, they will have likely already discussed the advantages of having a bank account for your business rather than moving business revenue through your accounts. If you have a legal problem with your business, it is easier to prove that your finances are separate.
You’ll also appreciate not having all of your records to find income and expense information for your tax returns.
This guide to the best-suited business checking accounts will help you choose one that suits your needs. Novo is an excellent choice for most businesses. It is a fintech company offering free small business banking powered through Middlesex Federal Savings F.A. It integrates easily with leading financial tools such as Gusto and QuickBooks.
#6 – Filing Annual LLC Reports
Mississippi requires LLCs to file an annual report to the Mississippi Secretary Of State. These reports must be filed on the same day that taxes are due, which is April 15th each year.
Your annual report is a way to ensure that your business information is up-to-date each year. It will include your contact information and business name, as well as information about your registered agent. The report must include the name and address of the person who filed it.
Missing the deadline for filing your annual report could result in the dissolution or dissolution of your LLC. It is simple to file it. It is easy to file your report online at the Secretary of State website. Or, you can use your Incfile account for guidance. Mississippi charges $25 annually for annual reports.
There are several steps that you can take after setting up your LLC, depending on your business goals. Consider whether you want to trademark the business name. This can help protect your brand and prevent similar brands from being created. To protect your business model, and purpose, you can trademark it.
HR Software is a great option for hiring employees in your LLC. It will help you manage and recruit staff.
Even though you have just formed your Mississippi LLC, it is a smart idea to learn how to dissolve your LLC in the event of a need. To help you plan for the future, visit our step-by-step dissolution guide.