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What is The Cost of an LLC?

What is The Cost of an LLC?


If you are interested in starting a business in San Diego and chose to make it a limited liability corporation, you are probably interested in the financial aspect of the endeavor. You may also be wondering whether LLC business formation services in San Diego are a worthwhile investment. Read on.

Do I need a lawyer to start an LLC?

You do not necessarily need a lawyer to start an LLC unless you have some specific concerns or want to understand the potential legal issues and implications of starting an LLC. However, engaging the services of a professional with experience in providing the whole range of business formation services would definitely be a sound call. This goes double for newcomers to the world of business. 

Why do I need expert help to start an LLC?

Most of the requirements for the formation of a limited liability company are simple steps that you can take without the help of an expert. But if you want to be absolutely certain that nothing will fall through the cracks and that the process will be fast, smooth and go without a hitch, you might want to consider delegating the task to professionals. 

Experts can help you with the following:

Choosing the company name

The trick is to pick a name that is unique. To check if the name you’ve had in mind is available, you can visit the State of California’s Secretary of State website. Professionals can also reserve a name on your behalf if you plan on starting your company at a later date. 

Meet the LLC Organizer requirement

An LLC Organizer is a person or company responsible for organizing and submitting LLC formation documents. This can be a member of the LLC, but you are free to leave the ordeal to a specialized service.

Appointing a Registered Agent

You must designate a registered agent, which is a requirement in general and a required piece of information on the Articles of Organization form.

Opt for management/ownership structure

Will the company be managed by its members or have a designated manager? Professionals can help you understand the implications of both options and reach a decision.

Create an Operating Agreement

The Operating Agreement is needed to establish the business and various business-related matters, as well as to protect the personal assets of LLC members.

File the Articles of Organization with the State of California

The decisive moment in the process of LLC formation is when the Articles of Organization form is filed and accepted by the Secretary of State. Information needed to fill out the document includes the name and address of the LLC organizer and registered agent, as well as of the company itself. You will also need to file information on the management structure and method.

Get an EIN and open a bank account

Any registered California LLC must file for Employer Identification Number (EIN) with the IRS. You can then proceed to open a business bank account as most banks require an EIN in order to open one. At this point, you will need to find an accountant to help you with the matters of bookkeeping, reimbursements you may be entitled to, etc.

Paying California State taxes

California State taxes have nothing to do with the company income. They are merely the cost of doing business in California. 

Licenses and permits

Obtain reliable information about the required licenses and permits and avoid fines.

Filing the initial Statement of Information

The original Statement of Information must be filed within 90 days of the company registration date.

How much does a lawyer charge to form an LLC?

You can expect the lawyer to charge a minimum of $400 an hour for guidance through the process of setting up an LLC, although the hourly fee could be up to $750 or even higher. Cost may vary depending on your location, how many members your LLC will have and other factors that could make the process of setting up an LLC longer and more complex.

How much does an LLC cost per year?

The cost of forming and operating an LLC depends on the state. In case of the state of California, an annual LLC tax of $800.00 applies. This is due by the 15th of the 4th month following the formation process, as well as on an annual basis afterwards. 

There is also a $20.00 reporting fee, to be submitted together with a statement of information within 90 days following the formation, as well once every two years. Your LLC may be subject to an additional LLC tax, but only if its income exceeds the amount of $250,000.00.

Fast & efficient LLC business formation services San Diego

If you’re finally feeling ready to unleash your inner entrepreneur, you’re going to need a reliable team by your side to help you turn ideas into reality and put plans into execution. If you seek professional assistance of experts in the business formation business, there’s no time like the present and no place like Mission Valley, San Diego, CA.

Here at David York’s Tax Service, you will find that we go all out to ensure the process of business formation which you have entrusted us with goes without a hitch. We make your business our top priority, so give us a call today and let’s get started!