When to incorporate?

The creation of an LLC has several advantages that may or may not be important to a business owner. But, regardless of any other factors, a business owner needs to form an LLC when he or she begins to make profits or take risks.

When to incorporate?

The creation of an LLC has several advantages that may or may not be important to a business owner.

But, regardless of any other factors, a business owner needs to form an LLC when he or she begins to make profits or take risks.


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Anyone starting a business, or currently running a business as a sole proprietor, should consider forming an LLC. This is especially true if you are concerned about limiting your personal legal liability as much as possible.

Depending on the state in which you are forming an LLC, you may not have to follow all of the steps below.

Your state's secretary of state office will be able to provide you with more information on the specific steps you will need to take to properly form an LLC.

Although the information required varies from state to state, generally you will only need to provide the name and address of your LLC and the names of its members. LLCs are popular because they offer the same limited liability as a corporation, but are easier and cheaper to form and manage.

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A serial LLC is an LLC whose articles of formation allow unlimited segregation of members' interests, assets and operations into separate series. The term articles of organization is the name used by most states, but your state may refer to the document by another name, such as a certificate of formation.

Most banks require company details, such as date of formation, type of business and the names and addresses of the owners.

A limited liability company (LLC) is a popular choice among small business owners for the liability protection, management flexibility, and tax advantages this form of business entity often provides. 

Any LLC offering professional services such as chiropractic, dentistry, law, medicine and surgery, optometry, osteopathic medicine and surgery, podiatric medicine, public accounting, psychology, or veterinary medicine must be professionally licensed and incorporated as a restricted professional business.

If your state has such a publication requirement, check with your state's business registration office for more information about the content of the notice, how many times it must be published, and any other requirements that may apply.

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