Why should you form an LLC in Florida?
Business choose Florida as one of the top few states to incorporate. Florida has become one of the most desirable states in the country in which to conduct business. The State consistently leads the nation in new business incorporations. With one of the largest supplies of business parks, an advantageous business tax system, transportation availability, 14 foreign trade zones, an abundance of electrical power, and a large population of skilled human resources, Florida provides everything that a business requires to function.
New businesses are registered in Florida each year. Most of these businesses are incorporated as Florida corporations. In 1997, over 100,000 new Florida corporations were formed. The number of businesses that registered as limited liability companies, on the other hand, were less. There was only a little over 2000 Florida LLCs in 1997.
The substantial difference in the number was due to Florida’s LLCs laws. A 5.5% income tax was applied to every Florida LLCs. In addition, start up fees for forming an LLC in Florida is higher than incorporating as a Florida corporation.
The LLC law was changed in 1998. 5.5% income tax was eliminated. LLCs start up fees were lowered. Interests earned in LLCs were protected from any claims filed by creditors. This drastic change in the Florida LLCs law has prompted a increase in the number of businesses registration as LLCs.
Should you form an LLC or incorporate and elect an S Corporation?
An S Corporation eliminates double taxation. However, the S Corporation does not have the flexibility of an LLC in regard to the allocation of income to its members.
An LLC may have an unlimited number of members. However, ownership in an S Corporation is limited to no more than 35 shareholders. Further, an S Corporation cannot have shareholders who are C Corporations, other S Corporations, certain trusts, LLCs, partnerships or nonresident aliens.
LLCs are permitted to own subsidiaries without restriction, while S Corporations are not allowed to own 80% or more of another corporations shares.
You can use our guaranteed services to form a corporation or form an LLC, and save a substantial amount of money you would otherwise pay an attorney. However, if you need legal or financial advice as to the type of corporation or LLC that would best suit your business needs, consult your attorney or financial advisor.
Forming a Florida Limited Liability Company (LLC)
General Incorporation Requirement to form a LLC:
A LIMITED LIABILITY COMPANY is a hybrid form of business entity combining some of the attributes of a corporation with the status of a partnership.
Any entity that transacts business in Florida as a limited liability company is required by Florida Statutes to file Articles of Organization or an application for authorization with the Division and pay the filing fee. These documents must be typewritten or printed legibly in the English language. The professional advice of your legal counsel to ascertain exact compliance with all statutory requirements is strongly recommended.
All limited liability companies must file a Uniform Business Report with the Division each year between January 1 and May 1 and pay the filing fee. Failure to file will result in administrative dissolution of the limited liability company or loss of authorization to transact business in Florida as a foreign limited liability company.