Start An LLC In Connecticut
A great way to protect yourself from personal liability as a small business owner is to set up a limited liability company (LLC) in Connecticut. LLCs help shield business owners’ personal assets from business liabilities.
Are you wondering how to start an LLC in Connecticut? Fortunately, the process is fairly simple. We’ll show you how in this step-by-step guide.
But first, let’s look at how Connecticut compares to its neighboring states as a place to start an LLC.
|State||Connecticut||New York||Massachusetts||Rhode Island||US Average|
|LLC Filing Fee||$120||$200||$500||$150||$130.38|
|LLC Annual/Biennial Fee||$80 (every year)||$9 (every 2 years)||$500 (every year)||$50 (every year)||$89.34 (every year)|
|Corporate Tax Rate||7.50%||6.50-7.25%||8.00%||7.00%||5.60%|
|Nominal GDP per capita||$82,233||$93,463||$91,129||$60,185||$64, 773.08|
Before You Set Up An LLC In Connecticut
Before we discuss the steps on how to start an LLC in Connecticut, there are a few things you will need to keep in mind.
Every LLC must have a registered agent and a detailed list of members and managers. You will also have to pay a fee to register the company as an LLC, and you may even need to pay for reserving a name.
Moreover, your business will need to pay taxes, and you might have to obtain additional licenses or permits, such as trademarks.
How Much Does It Cost To Start An LLC In Connecticut?
Suppose you’re wondering how much it is to start an LLC in Connecticut. In that case, you’ll find the information you need in the section below.
Forming an LLC in Connecticut costs $120 to form online. You will pay this fee to the Connecticut Secretary of State when you file a Certificate of Organization.
Self-filing is frequently the most cost-effective alternative but preparing the paperwork and filing them can be difficult. Another option is to hire an attorney, although this will usually cost you hundreds of dollars.
If you want to secure your LLC name before submitting the Articles of Organization, you must pay $60 to submit a name reservation application.
Additionally, you will need to pay a registered agent fee if you need an agent to help ensure that your business is compliant. He or she will also help you meet certain deadlines to avoid late fees.
Did You Know?You can start an LLC in just one to four business days!
Steps To Start An LLC In Connecticut
If you’re ready to start an LLC in Connecticut, you can follow our step-by-step guide below.
1. Pick A Name For Your LLC
An LLC’s name must include the words “Limited Liability Company” or the acronyms “L.L.C” or “LLC,” according to Connecticut legislation. The words “Limited” and “Company” can be shortened as “Ltd.” and “Co.” respectively.
Moreover, the name of an LLC must be different from that of other businesses registered with the Connecticut Secretary of State. You can browse the Connecticut Secretary of State’s business name search to see if a name is available.
By filing an application for the reservation of a name with the Connecticut Secretary of State, an eligible LLC name can be reserved for up to 120 days. The application must be completed and submitted via postal mail, and the cost of submitting this application is $60.
You should also check if the domain name you want for your LLC is available. While several domains, such as “.net” or “.co,” are often available, you may want to use a “.com” to ensure that your company has credibility.
2. Find A Registered Agent In Connecticut
To process applications and ensure that state requirements have been met, every LLC in Connecticut must have an agent. This is a person or company who consents to accept legal documents on behalf of the company in the event that it is sued.
On the forms, a registered agent is referred to as the “Statutory Agent for Service of Process.”
Before appointing an agent, he or she must agree to accept the service of process on the company’s behalf. The registered agent could be a:
- Full-time Connecticut resident
- A business entity in Connecticut
- The foreign business entity that has secured a certificate of authority to conduct its business in the state
Keep in mind that business owners, members of the LLC, or managers could also become registered agents for the company.
|ZenBusiness – $49 + state fees to register your LLC (read review)|
|Incfile – $0 + $50 state fees to register your LLC (read review)|
3. Certificate Of Organization
To register an LLC, you will need to file a certificate of organization with the Secretary of State. You can choose to submit the documents online or via postal mail, and it costs $120. The articles of organization you submit must include:
- The LLC organizer’s full name, address, and signature
- Name, email, and physical address of the LLC
- Address and name of the members and managers
- The registered agent’s address, name, and signature
- A brief description of the nature of the business
- An indication of whether the company will be run by its members or managers
4. Other Required Documents
You might have to apply for additional licenses, permits, or registrations depending on the nature of your LLC’s business and where it is located in the state when creating an LLC in Connecticut.
Here is a list of some of the documents you may be required to apply for:
- Occupational or trade licenses – You should check with the Connecticut Department of Consumer Protection (DCP) to determine whether you will need to apply
- Registration with the Department of Labor – enquire with the Connecticut Department of Labor
- Trademarks – You can register for a trademark at a national level (visit the US Patent and Trademark Office) or at the state level (contact the Connecticut Secretary of State)
5. Operating Agreement
In Connecticut, you will not be required to create an LLC operating agreement, but it is strongly recommended you do so. An LLC operating agreement is an internal document that outlines the operations of an LLC.
This document outlines the members’ and managers’ rights and obligations and how the LLC will be governed.
It can also help protect the company’s limited liability status by proving that the LLC is a separate entity. If you choose not to draw up an operating agreement, your LLC will be governed by state law.
Your operating agreement should look something like this:
- Summary of your vision for the company
- Overview of the business
- Products and services offered
- Operational plan
- Marketing plan
- Business organization – members and managerial structure
- Financial model
Visit the US Small Business Association for more help drafting an operating agreement.
6. Get An EIN
Even though your LLC may not have any staff, it must acquire its own IRS Employer Identification Number (EIN) if it has more than one member.
If you are starting an LLC in Connecticut with just one member, you only need to get an EIN if it will have workers or if you opt to tax it as a corporation.
An EIN may be obtained by completing the relevant form on the IRS website. There is no charge for filing.
The Forms You Need To Register An LLC In Connecticut
We’ve included a list of the documents you may need when creating an LLC in Connecticut in the section below. Moreover, we’ve also included other important documents, such as the form you’ll need to change the business’ address.
- Certificate of Organization
- Application for Reservation of Name
- Change of Business Address
- Certificate of Amendment
- Interim Change of Member or Manager
- Change of Agent
- Certificate of Dissolution
LLC Taxes In Connecticut
When you start an LLC in Connecticut, there are two types of taxes that you will need to pay attention to. The first is federal taxes.
This is the tax payable to the Internal Revenue Service (IRS) based on the annual earnings of individuals, trusts, businesses, and other entities. LLCs do not pay federal tax by default, which is one of the benefits of starting a limited liability company.
However, LLCs are subject to state taxes. There is a $250 minimum tax, but you’ll need to contact Revenue Services to determine how much tax you will be required to pay.
You’ll have to register for tax with the Connecticut Department of Revenue Services in some situations, such as if you’re selling items and receiving sales tax or if you have workers.
This registration can be done online or by completing paperwork (Form REG-1, Business Taxes Registration Application) and submitting it via postal mail. Connecticut also has a $250 Business Entity Tax that is payable every alternate year.
Fortunately, this makes Connecticut a great place to start an LLC since you won’t have to pay as much tax as you would in other states.
To find out more, go to the Business Entity Tax homepage.
How Long Does It Take To Form An LLC In Connecticut?
If you choose to submit your application online, you can expect your LLC to be registered within five to six business days.
This includes the time it would take to complete the relevant paperwork and the time it takes to receive approval from the Connecticut Secretary of State (one to four business days).
However, if you submit your paperwork via postal mail, forming an LLC could take longer. Processing time takes approximately three to four weeks, while your application would take approximately two weeks to reach the Secretary of State.
How Much Does It Cost To Run An LLC In Connecticut?
There is an $80 fee that you will need to pay every year for running an LLC. This is for the annual report fee that you are liable for. You will also have to pay a $250 minimum Business Entity tax biennially.
Did You Know?Minors are not exempt from being members of LLCs in Connecticut.
What To Do After Formation
You’ve registered your LLC. Now what?
The truth is that forming an LLC is just the start. There are more steps you’ll need to take to get your business up and running. Here are a few things you’ll need to do:
- Create a logo. You can build your brand and stand out from competitors with a strong logo. Hire a graphic designer to help you with this.
- Build a website or online store. Next, you will need to build an online presence to help customers find you. Setting up your online store is an essential step if you’re selling products. If you need help optimizing your website, contact a digital marketing agency.
- Set up a business bank account. Keep in mind that you’ll need your EIN to do this. Setting up a separate business account is important, as it helps to keep personal and business finances separate.
- Consider business insurance. Another critical step is ensuring that your business has insurance coverage. In the event of an accident or storm damage, you will be covered.
- Submit an annual report. You will need to file an annual report every year by the end of the month that you formed the LLC. If the business was registered in April, for example, you must submit an annual report by the end of April each year.
While some of these steps may be optional, they are important to ensure that your business runs smoothly and is protected if something goes wrong.
Resources To Start A Successful LLC In Connecticut
Here are some additional resources to help you start your LLC in Connecticut:
- Connecticut Secretary of State – https://portal.ct.gov/sots
- Business Entity Tax – https://portal.ct.gov/DRS/Publications/Informational-Publications/2016/IP-201614-QA-on-the-Business-Entity-Tax
- Connecticut Department of Revenue Services – https://portal.ct.gov/drs
- Internal Revenue Service (IRS) – https://www.irs.gov/businesses/small-businesses-self-employed/employer-id-numbers
- US Small Business Association – https://www.sba.gov/offices/district/ct/hartford
- Connecticut Department of Consumer Protection – http://www.ct.gov/DCP/site/default.asp
- US Patent and Trademark Office – http://www.uspto.gov/
- Connecticut Department of Labor – http://www.ctdol.state.ct.us/
Start Marketing Your LLC In Connecticut
Once you have successfully set up your LLC in Connecticut, you’ll need to market it to ensure that customers know about your business’s products and services. We’ve listed a few steps to help you market your LLC successfully.
1. Conduct Market Research
Before devising a marketing strategy, you’ll need to conduct market research. Spend time getting to know your target market. Which platforms do they use? What products or services do they favor?
This will help you devise a strong marketing plan, as you can target social media platforms or influencers that your target market affiliates with.
You will also need to study your competitors. What strategies have they used that have proved to be successful? Which marketing attempts were not that successful?
2. Create An Online Presence
Next, you’ll need to create an online presence by creating an optimized website for search engines. Focusing on search engine optimization (SEO) is more important than ever since most people turn to search engines to find products and services.
A professional marketing agency can help you devise a good marketing strategy. Although this can be costly, the effect an SEO strategy has on businesses makes it worth the spend!
3. Work On Building A Brand
If you want your company to be successful, you will need to focus on building a brand rather than selling a product. Products can become irrelevant, but trusted brands sell.
To create a successful brand, you need an eye-catching logo and a functional website. Again, relying on a marketing agency can ensure that your brand stands out in a competitive market.
How To Dissolve An LLC In Connecticut
Dissolving an LLC in Connecticut is fairly simple. You can draw up your own Articles of Dissolution and submit them to the Connecticut Secretary of State.
Alternatively, you can complete and submit the Certificate of Dissolution form found on the Secretary of State’s website.
Setting up an LLC can be a simple and rewarding endeavor. There are several benefits that you can expect, including the protection of your personal assets and tax benefits. By following our simple guide, you can set up an LLC in Connecticut in a few days or weeks.
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