All Forum Posts by: Matt Horwitz

You cannot leave the consideration part blank. It's a necessary component for the document to be enforceable. I'd speak with a title company or two, as well as an attorney. 

@Mark S., keep in mind that you can also just form a Domestic LLC in Tennessee, instead of doing a foreign qualification. The registration fees for Foreign LLCs and Domestic LLCs in TN are the same ($300 to form, $300 per year). The benefit of foreign qualification though is you're still operating under the same legal entity, using the same bank account, and same EIN. Forming a Domestic TN LLC is an entirely new entity.

1. Go to the TN Secretary of State website: https://sos.tn.gov/business-services/limited-liability-companies. To file by mail: See Forms: Formed Outside of Tennessee > Application for Certificate of Authority (ss-4233). Approval time takes 5-7 business days. Alternatively, you can file online: https://tnbear.tn.gov/Ecommerce/RegistrationInstr.aspx. Approval is instantaneous after submitting payment.

2. The title company does not form entities for people (at least most title companies). Yourself or an attorney. Some CPAs do legal filings, but if you're going to hire someone, hire an attorney.

3. The entity part is not that difficult, but make sure to iron out all the details with the title company as their could be surprises. Ask them if they need a TN Certificate of Existence, for example. But hash out transfer tax details (if applicable) and make sure you ask them for all documentation they'll need to close.

I agree with @David Lichtenstadter. Too much exposure under one entity. Plus, if you're forming an LLCs in KY, it's $40 to file, then $15 per year. Can't beat that. Some of the cheapest LLC costs in the nation.

Further, do not trust a LegalZoom article on how to transfer title and register the deed. Hire a title company. It's not expensive at all.

@Vivek R., @Greg Downey is correct. You are doing business in RI and should form the LLC there, not where you reside. LLCs should be setup where they are legally doing business (which may or may not be where you reside).

The comment about setting up a Domestic LLC in Mass. and then registering as a Foreign LLC in RI makes no sense. The point being made is that you'll need an "in-state office". You don't need an office in the state. Just hire a Commercial Registered Agent (or use a friend or family member's address in RI). You're already talking about working with IncFile. Their services are $99/year. Good company.

Note: you'd have to pay for Registered Agent in RI even if you first registered in Mass., then foreign qualified in RI (Foreign LLCs still must have a Registered Agent).

Additionally, forming an LLC in Mass. costs $500 by mail of $520 online. Plus, their Annual Report fee is the same ($500 by mail or $520 online). Keep a domestic LLC in RI. It's far easier and far cheaper.

Regarding IRS mail and LLC mail...

- IRS mail: The IRS doesn't need (nor care about) your Registered Agent address in RI. It doesn't apply anyway. They just need the state of organization listed. Give the IRS your mailing address in Mass. The IRS mailing address and LLC Registered Agent address do not need to match.

- LLC mail: List your RI Registered Agent's address in #2 of the Articles of Organization. For #4 (principal office address), just list your Mass. address. IncFile will scan any mail to your online dashboard. Anything else will be sent to your Mass. address. Use your Mass. address for other online/business registrations to funnel your mail there.

Hope that helps ;-)

@Dave Sandford, you'll want to form the LLC in the state where you are buying property and doing business. You'll then get an EIN from the IRS.

Since you don't have an SSN or ITIN, you can still get an EIN for your LLC. You'll just need to use Form SS-4 and mail or fax to the IRS (instead of getting the EIN online). Faxing has a much faster approval time. On line 7b where it asks for your "SSN, ITIN, EIN", just enter "Foreign".

Since you'll likely have a US tax obligations, that's where the ITIN comes in. You'll obtain this via Form W-7. 

The ITIN is not needed right away, so I'd say the order would be LLC, EIN, then ITIN. You should be able to do everything yourself remotely just using an e-fax and/or regular mail. If you decide on a state for your property/LLC, let me know. I'll send over the detailed steps if you'd like.

@Mike Hottinga, solid updates! I'd also ask your tax person about pros/cons of going Sole Proprietorship now and transferring properties to LLC later vs. getting properties titled to LLC from the start. Also keep in mind financing, as terms and programs are different.

@Keong Kam, I'm curious if your accountant detailed why they wouldn't want you to form a Domestic LLC in MO and disregard registration (whether foreign or domestic) in CA. Yes, apportion income and pay necessary taxes, but wondering why the CA LLC is needed. Could be something I'm missing, but would love to hear anything if he has shared or if you ask.

LOL, thanks @Deren Huang ;-) 

@Bobby Trinh, I know I'm a little late here... but what the heck, maybe you'll need these steps again when you form your next Texas LLC ;) Here's the break-down:

1. Texas LLC Name: You need to make sure your desired LLC name is "distinguishable", meaning unique among all the other businesses registered in Texas. Don't ask me why, but Texas has the MOST STRICT requirements when it comes to name availability. Yea, there is a "name search" via the Comptroller (https://mycpa.cpa.state.tx.us/coa/), but use that ONLY as a preliminary search. You'll need to call the Corporations Section and get pre-clearance. Their hours are 8am to 5pm, M-F.

Your TX LLC name must end with an allowable designator: LLC (most common), L.L.C., Limited Liability Company, Limited Liability Co., Ltd. Liability Company, Ltd. Liability Co., Limited Company, Ltd. Co., or Limited Co.

2. Registered Agent: A fancy word for a person or company who agrees to accept Service of Process if your LLC is involved in a legal or court matter. It's where your LLC can get served. Address of Registered Agent must be a street address. PO boxes are not allowed. You can be your LLC's Registered Agent, or you can use the address of a friend or family member. You can also hire professional Registered Agent services, more technically known as a Commercial Registered Agent.

3. Certificate of Formation: This is the document that creates your legal entity (once processed and approved by the state). Also known as Form 205. If filing by mail, you'll also need to send in a Consent to Serve Form (Form 401A), which is the Registered Agent accepting their appointment as such. Filing fee for the Cert. of Formation is $300. You can also file these online via SOS Direct: https://direct.sos.state.tx.us/acct/acct-login.asp. It's kind of quirky as they make you enter your credit card info every time you login, but don't stress. It's only charged if you complete the filing. Approval by mail takes 5-7 business days. Approval online takes 2-3 business days. Once your TX LLC is approved, you'll get back a stamped and approved Certificate of Formation and a Certificate of Filing.

4. Operating Agreement: Have all LLC members sign an Operating Agreement. Spells out who the owners are, how much they own, how profits are split, how taxes are paid, how the LLC is managed, and more.

5. EIN: Wait for LLC approval, then obtain EIN (also known as Federal Tax ID Number) from the IRS. It's free and can be done online: https://www.irs.gov/businesses/small-businesses-self-employed/apply-for-an-employer-identification-number-ein-online. You'll get PDF printout with your EIN at the end.

6. Bank account: Open LLC checking account. Some banks charge monthly maintenance fees, but if you call and shop around you can find banks that don't charge monthly fees. There's always a few in each area.

7. Annual Report & PIR: The "Annual Report" in Texas is known as the Public Information Report (PIR) and Franchise Tax, and this is required by all Texas LLCs. Annual Report is filed with Comptroller, not the Secretary of State. You'll pay a franchise tax (usually 1%) if gross receipts are over $1M. Due by May 15th. The first one is due the year after the year of LLC formation. Most filers don't pay anything, but I recommend speaking with an accountant in Texas.

@Bob Okenwa, appreciate the kind words my man!