- [Narrator] How form an LLC in West Virginia.
West Virginia's an excellent place to form a new LLC.
Not only does it have low business costs
and some of the lowest sales tax in the U.S.,
it also boasts the third lowest cost of labor in the nation.
Every state has slightly different requirements
for forming an LLC.
Follow along closely to learn the required steps
for creating your own Limited Liability Company
in the state of West Virginia.
(relaxing music)
There are two ways to form an LLC in West Virginia.
You can form one yourself, or you can hire a service
to do it for you.
Let's start by looking at the five basic requirements
to form an LLC in West Virginia on your own.
You can also find these steps in more detail
on our website, linked in the description below.
One, name your LLC.
Every state has it's own rules about what kind of names
are allowed for LLCs.
In general, you will need to observe
these naming guidelines.
Your name must include the phrase Limited Liability Company,
or one of its abbreviations, LLC, or L.L.C.,
with the period following each letter.
Restricted words such as bank, attorney,
law office, et cetera, may require additional paperwork
and may also need a licensed professional
to be part of the LLC.
Your name cannot include words that could confuse your LLC
with a government agency, such as FBI, Treasury,
State Department, et cetera.
You cannot use a name that has already been registered.
To see if your name is available, in your state,
you'll need to do a name search.
This free service is available on your state's
Secretary of State website.
Check out our free guide for finding the direct link
to your state.
We also recommend that you check to see
if your business name is available as a web domain.
Even if you don't plan to make a business website today,
you may want to buy the URL in order to prevent others
from acquiring it.
Two, choose an Agent for Service of Process.
It's a good idea to nominate an Agent for Service of Process
for your LLC, who is your business's point of contact
with the state.
An Agent for Service of Process is more commonly known
as a registered agent in other states.
The registered agent can be an individual
within the company, including yourself,
or you can hire a professional service,
authorized to do business in West Virginia.
They will send and receive legal papers on your behalf.
These documents include official correspondence
like legal summons and document filings,
which your registered agent will receive
and forward to you.
Your registered agent will help remind you to file
the necessary reports.
Failure to properly maintain your LLC
can result in fines and dissolution,
so this assistance is valuable.
The West Virginia Secretary of State will act
as the default agent if you do not nominate one
and will receive all notices and files.
Three, file the Articles of Organization.
To register your West Virginia LLC,
you will need to file the Articles of Organization
with the State of West Virginia.
This can be done online, or by mail.
You'll also need to state whether your LLC will be
member-managed, or manager-managed.
Member-managed means all members of the LLC
manage the company.
This is good for small organizations
where everyone is involved in the day-to-day operations.
The second option is manager-managed,
where individuals are appointed to manage the LLC.
This is appropriate for larger organizations,
where not everyone is involved in the day-to-day affairs
of the business.
Four, create an Operating Agreement.
Although not every state requires it,
you should always create an Operating Agreement
to establish ownership terms and member roles for your LLC.
This foundational document is the core of your LLC
and will help you maintain your organization,
as well as further establish your LLC
as a separate legal entity.
There are six main sections of an Operating Agreement.
Organization, outlines when and where
the company was created, who the members are
and how the ownership is structured.
Management and Voting addresses how the company is managed,
as well as how the members vote.
Capital Contributions, covers which members
financially support the LLC and how more funds
will be raised in the future.
Distributions, outlines how the company's profits and losses
are shared among members.
Membership Changes, describes the process for adding,
or removing members, as well as, if and when,
members can transfer their ownership shares.
And Dissolution, which explains the circumstances
in which the LLC may be dissolved.
An Operating Agreement is an internal document.
It does not need to be filed with the state.
However, it should be updated
every time there's a change in membership,
or management at the company.
You can download a free sample Operating Agreement,
or create a custom one,
using our free Operating Agreement tool,
at howtostartanllc.com.
Five, obtain an EIN.
Lastly, you'll need to get
an Employer Identification Number, or EIN, from the IRS.
Also known as a Federal Tax Identification Number,
your EIN is like a Social Security Number for your LLC
and it's how the IRS tracks your business for tax purposes.
An EIN is also necessary to open a business banking account
and legally hire employees.
EINs are free of charge and can be obtained from the IRS
online, or through the mail.
And with that you'll have formed a West Virginia LLC
on your own.
Option two, hire a professional service.
The second way to create a West Virginia LLC
is to hire a professional service
to create your LLC for you.
Hiring a professional service to file your forms
and act as your registered agent for the LLC,
will cost you an additional $50 to $150.
However, there are several benefits to working with a pro.
A hired registered agent,
helps with getting your reports filed on time,
helps you stay organized
by keeping your business mail separate
and is available at all regular business hours
to accept official mail and legal papers
on your LLC's behalf.
A final and important additional benefit
of using a service is privacy.
A professional service will provide a level of privacy,
by with holding your personal name and home address
from the LLCs contact information.
There are many reason why you might not want
your personal information easily accessible
and associated with your business.
Hiring a professional LLC formation service
is an easy way to accomplish this.
Now that you have seen the different requirements
and ways you can form an LLC in West Virginia,
visit our site and take some time to research your options
and establish a solid foundation
for your business activities.
Click on the links in the description below
to research the top five professional formation services,
or get more information on how to form
a West Virginia LLC on your own.
Now you know all the steps to form an LLC in your state.
For a more detailed guide, go to howtostartanllc.com.
You can also create an Operating Agreement
and use our business plan tool free of charge.
Give the video a like if you found it useful
and subscribe if you'd like to see more.
And if you have questions, or encounter any roadblocks,
leave a comment below.
Good luck in staring your small business.
(relaxing music)