What is an LLC? | Interview with Matt Horwitz of LLC University®
ฝัง
- เผยแพร่เมื่อ 31 ม.ค. 2021
- What is an LLC and who should form an LLC for their business? How do you form an LLC? What's the best state to file an LLC in?
Product licensing expert Stephen Key interviews Matt Horwitz, the founder of LLC University®.
Matt and Stephen discuss the benefits of forming an LLC, such as personal liability protection and pass-through taxation. You'll also learn about the history of LLCs and how they are used by small business owners.
About LLC University:
LLC University® teaches people how to form LLCs step-by-step, completely for free, in every state.
Visit LLC University:
www.llcuniversity.com/
About InventRight:
Stephen Key and Andrew Krauss are the world's leading experts on how to license a product idea. If you have an invention idea, this is the show to watch. Steve and Andrew are the cofounders of inventRight, a coaching program that has helped people from more than 60 countries license their ideas for new products.
Visit InventRight:
www.inventright.com/
©inventRight, LLC.
LLCU Publishing, LLC and inventRight, LLC do not offer legal, tax, or financial advice.
Please exercise caution when evaluating any information, including but not limited to business opportunities; links to news stories; links to services, products, or other websites. No endorsements are issued by LLCU Publishing, LLC and inventRight, LLC, expressed or implied. Depiction of any trademarks/logos does not represent endorsement of LLCU Publishing, LLC or inventRight, LLC, their services, or products by the trademark owner. All trademarks are registered trademarks of their respective companies.
Reference on this video to any specific commercial products, process, service, manufacturer, company, or trademark does not constitute its endorsement or recommendation by LLCU Publishing, LLC or inventRight, LLC or its hosts. This video may contain links to external websites that are not provided or maintained by or in any way affiliated with LLCU Publishing, LLC or inventRight, LLC. Please note that neither LLCU Publishing, LLC nor inventRight LLC guarantees the accuracy, relevance, timeliness, or completeness of any information on these external websites. The inclusion of any links does not necessarily imply a recommendation or endorse the views expressed within them.
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His site is truly what teaching applied skills towards formations of LLc’s so many sites it’s more about selling
He’s wonderful for taking the time to help others 💜🎉
Thank you! I recognize your logo from the website comments too ;) You rock!!
@@llcuniversity u too!
I just wanted to leave a comment saying thank you! LLC University has helped me understand more about business in every way. Including name Changes. KEEP IT UP!
Wonderful to hear! Thanks so much Josh :)
This’s helpful thank you
You're very welcome!
Good stuff, thanks!
You're welcome!
Great stuff
Thanks!
Great information!! I would like to know if in Westchester County New York still have to do the publication is not part of nyc?
Thanks Yovana! Yes, the publication requirement is state-wide. We have the details on this page: www.llcuniversity.com/new-york-llc/publication-requirements-part-1/ - I recommend calling a few newspapers in Westchester county and checking on pricing. And then see how that compares to publishing in Albany county.
Hi Matt! I was reading your 'LLC Revoking S Corporation Election' article and started watching your youtube videos! Great information. I have a question and I've been searching online to get a clear answer, but no luck so far - I have a single member LLC that's taxed as a S Corp. I want to convert my LLC to a C Corp now, but don't know what I need to do for federal purposes. I understand I need to apply for a new EIN. Do I need to file a Revocation of S Corporation Election with the IRS? Or will they terminate my LLC once they receive my final 1120S tax return?
Hey there! If your LLC has an EIN, you don't need to get a new one. You just need to revoke the S-election on the page you were reading: www.llcuniversity.com/irs/llc-revoke-s-corp-election/ - Just don't file Form 8832 and make another election. Just revoke the S-election, and by default, the IRS will then tax your LLC as a C-Corporation. Hope that helps.
Hi Matt! Thank you for all this information! It was very helpful. Question: when I submitted articles of organization for my llc, i forgot to include my middle name. And I have my middle name on my id, ssn, bank accounts, etc. Is it going to be a problem? Do I have to file an amendment before moving forward (before getting ein, etc)? Thank you so much!
Hey Alena! You're very welcome :) No, nothing to worry about at all. Your name doesn't need to perfectly match. If you'd like, you can use your full name in your LLC Operating Agreement: www.llcuniversity.com/llc-operating-agreement/
Can I shift my Delaware LLC registered company to Wyoming? If YES what will happen of my EIN and company Fike number ?
@@reazurrahman4831 - Hi Reazur, yes, this is often referred to as domestication. Your Delaware LLC can domesticate/continue into Wyoming. Once that's processed, you'd then dissolve your Delaware LLC. We don't have an guide on domestication, however, here's a guide on Delaware LLC dissolution: www.llcuniversity.com/delaware-llc/dissolution/
Hello Matt! I appreciate very much the information. Is it possible to create the LLC in New Mexico with me as a member (non US resident) and a few months later change the owner of the LLC to a foreign company outside of the US (owned by me)?
If so, what would I have to do and how much would it cost? Thank you!
Hi Jose, yes, this can be done. You would sell or assign your LLC Membership interest to the foreign company. The state filing wouldn't change (since Members aren't on the Articles of Organization in New Mexico). You'd sign an Assignment of LLC Membership Interest and then amend the Operating Agreement. You might want to hire an attorney as these forms aren't the easiest to find.
Hi Matt,
The information you provide is outstanding. Are hairstylist (Independent Contractor) renting a booth at a hair salon able to form a LLC? If so, would forming the LLC using the hair salons business address affect the hair salon owner's business formation or would another business address need to be used?
Thanks in advance!
Thanks Erica! Yes, you can certainly form an LLC for your hairstylist business, even if you are renting a booth from a hair salon.
If the hair salon is okay with you using the address, then you certainly can. And it wouldn't impact their business or their business formation.
Having said that, there are usually a few addresses listed on the LLC filing form, usually called the LLC Articles of Organization:
• Registered Agent address
• Principal address
• Mailing address
• Member's address
And while the hair salon may let you use their address for all of those address fields, it's important to know that notices from the state will go to the salon (addressed to your LLC though). If you use the salon address for all those fields, you'll want to make sure to change those addresses with the state if you rent a booth elsewhere or stop renting from this salon.
Hope that helps :)
@@llcuniversity Thanks Matt, this was very helpful!
Hi Matt, I have been reading a lot on your university LLc site, and I do have a question. Im looking into investing in real state in different states, not sure which ones yet but if I create the holding company in Wyoming, and the child where the property is located but how can I set up the child llc prior to buying? Do I pick a few states where I might want to invest and set up before I buy? Or do I need to wait to have a property? But if so, I cannot make an offer until that llc is set up, right?
Hi Rosario, when the contract is written, you can write "Name, and/or assigns". And communicate with the real estate agents and/or seller that you'll be taking title in the LLC. "And/or assings" is common for contracts. You technically, will assign (via an Assignment of Contract; it's a simple form) your contract rights to your LLC. So this way, you can go under contract, and then form the LLC where you want.
hello - do you ever use a OPERATING AGREEMENT MEMORANDUM?? do you have a sample or can you tell us what is and isn't in it??
Do you mean something like recording meeting minutes? This isn't required, but it's just a fancy way of saying "taking notes". And then signing them and making them official.
Can you please tell me why a terminated LLC cannot be used again by a brand new person? The LLC name that I am currently looking to use has been terminated for the last five years. However, when I go to the ca sos website to register the name, there is an error message. Is there anyway that I can use this name now or in the future?
You'll want to call the California Secretary of State and check on the status. Each state has different rules for when an LLC can be used again by the public.
Good Video! I currently have sales for a product I invented. I'm selling online. I'll be moving states in ~8-months. I'd like to form an LLC now to get the liability protection. I'd like to form the LLC in the state I'm moving to. However, I don't want to file a foreign LLC in the state I currently live just for the ~8 remaining months I live here. Therefore, is it okay to just form the LLC in the state I'm moving to and do nothing else?
Hi Shane, that is a good idea. Depending on the state where you reside, you can likely get away with not having to foreign qualify there.
Hi Matt Awesome web site, I had a question before I start ....I want to open an LLC in NY and would like to use a po box for the business address , should I purchase the po box from the postoffice before I start the paper work for the LLC ? Thanks
Thanks William! In NY, while you can use the PO box address on the Articles of Organization (the form to create your LLC), you won't be able to use that address when you register for taxes (and likely other registrations to). It would be better to use a mailbox rental address (ex: the UPS Store or any mailbox rental facility). Yes, you'll want the address in place before the LLC gets filed. If you're shopping around for mailbox services, we have a helpful questionnaire you can use to compare places: www.llcuniversity.com/wp-content/uploads/Mailbox-Rental-Questionnaire.pdf
@@llcuniversity Thanks for the Info Matt you are the BEST!
You're welcome man. Thanks!
Hi Matt, if I am creating a business with a co-owner, which state should we form the LLC in, if I live in Florida and he lives in California?
Hey D, what kind of business activities will be taking place in both states?
Hello, thank you for helping small business people. I used your free operating agreement template. I added a dba under my LLC. I need to amend my operating agreement to show that my LLC now owns this new DBA. Would I amend the section number 3 under Preliminary provisions? Thank you
You're very welcome! You don't need to put the DBA in the Operating Agreement. It's not required. If you want to, you can put it towards the top/in the opening. For example, "This operating agreement of ABC Company LLC, dba Johns Pizza"...
@@llcuniversity Thank you. My bank is asking for the amendment since I added the dba after opening the business banking account.
@@onethriftcookie - Ah, I see. You can create another Operating Agreement and at the top, change the title to "Amended Operating Agreement". In the opening section, say this: This Operating Agreement amends and supersedes all prior Operating Agreement. In another section, say something along these lines: This LLC has registered a DBA under the name of THE NAME, as registered with the office of THE STATE OFFICE, on such and such a date. Hope that helps!
@@llcuniversity You are GOLD! Thank you. I sent a donation to LLCU to show my appreciation.
Hey Cookie, thanks so much!! We really appreciate your support! You're the reason we do what we do :-)
Yesterday, I called the IRS and the AI robot was saying that they are only accepting EIN applications through online mode only and not by mail. As a non us resident, how can I get an EIN then?!
That's not true. After your LLC is approved, you can get an EIN from the IRS. Here's how to do it for non-US residents: www.llcuniversity.com/irs/how-to-apply-for-ein-without-ssn/
I guess the question I’m trying to ask is will and can you get LLC no matter what your buisness is will bank help you build it?
Yes, you can form an LLC and then operate any business with your LLC (as long as it's not illegal lol). You can get a bank account for the LLC too, after the LLC is approved. The bank won't help you build the business, by doing things. Some banks can help if you want a loan though. You'll want to call around to a few banks and ask though.
I really appreciate that
Hi Matt- how are you?
I know this topic is not part of this conversation -- but I would’d like to ask you if you any accountant recommendation just as good as NorthWest 😃😃😃 many many many many thanks ☺️☺️☺️☺️
Hey, I'm doing well, thank you :) We don't have specific recommendations. However, we have tips on finding an accountant here: www.llcuniversity.com/accountant/
@@llcuniversity Matt - Legend!! Thank you and Happy Easter!!! Will check it out 💋💋
@@Unicorn-ul1ol - You're very welcome! Thanks! You too :)
I want to start my business. Should I do it myself or use zenbusiness.com, incfile, or northwest? Can I use davinci virtual office for my business address and for a registered agent? Or northwest?
Hi Arleatha, regarding the use of the Davinci virtual office, you can use it as a business address, but you may not be able to use it as a Registered Agent address (if you'll be the Registered Agent), but it depends on the state. It's a bit of a gray zone. What state are you forming an LLC in. Do you prefer to file yourself with instructions or would you like a service provider to file for you?
@@llcuniversity i am in Florida. I dont know how to go about doing it. This is my first time. I thought about using zenbusiness.com to do it for me. But then I saw your website saying u can do it yourself and save money. But then if u don't want to do it yourself...u recommended northwest. So I am on the fence on if I should it by myself and save some money or have zenbusiness.com or northwest do it? What do u suggest? Davinci offers registered agent option . So I dont know who to choose
@@llcuniversity thank you for responding
Hi Arleatha, will you be using Davinci to work from there or are you just looking for an address (for the Registered Agent and the address on the LLC Articles of Organization)? You might be fine with just a Commercial Registered Agent unless you want office space and the other aspects of a virtual office provider.
I recommend reading our Florida LLC course (print out the forms, fill them out, but don't file) to understand more. Then you can decide if you want to do it yourself or hire someone. Please see this page: www.llcuniversity.com/florida-llc/ (use the "Detailed Lessons" links). Hope that helps :)
Hello, do I need to file a DBA for this situation: I want to create my LLC, but it wont be the name I'll be using for business. So I'd make my LLC something XYZ Cosmetic LLC. But my brand name and the name i'd be doing business will be "123something". "123something" is my brand name and will be going for a trademark. Does this need a DBA? Thank you
Hey Matt, you don't need a DBA for a brandname (or federal trademark). Hope that helps.
@@llcuniversity thank u! So when would I need a DBA? If I wanted to sign papers and legal docs as that new name?
@@matt8953 - No, DBAs aren't used for signing contracts and legal docs. Meaning, that's not their purpose. (Note, If you had a DBA, contracts would include the full legal name anyway... written like ABC Company LLC dba My Company Name).
A DBA is used if the business wants to represent itself to the public under a name that is different from its true and legal name.
@@llcuniversity does “representing themselves as a different name” include using a brand name differing than LLC name? I wouldn’t be using my LLC name on products or website/marketing material. Since I’d be using a different name does that warrant a DBA? Thank u hopefully I make sense
That does sound like a DBA would be the route to go here.
What about expats?
Or more specifically, flexpats?
What’s a flexpat? A flexpat is someone that pays taxes in the US, technically does business in the US, lives almost totally outside the US and is willing to change their home state to get the best benefits for their bucks.
Is there a clear winner? Or perhaps a top 3 states to choose from?
This could be a good topic to post a video on as flexpats are becoming more and more of a thing.
Hey Jeremiah, great topic suggestion! Things like this can begin to get a bit gray, however, you can always form the LLC in whatever state you'd like. And if you begin doing business in another state, you can foreign qualify your LLC there. I know that might not be the answer you're looking for, but hope it somewhat helps. Thanks.
@@llcuniversity Right but what I’m asking is this. If someone is a free agent… in other words… they’ve lived, are living or plan to live almost entirely out of the country, which state offers the most attractive benefits to move their home to?
This is currently my situation. I don’t have a home state in the US anymore as I have up my residence before traveling. I will be coming back eventually but I’m open to move to any state, particularly if there are attractive business incentives.
It's a bit too hard to answer, since there's so many things that could be important to different people. State income taxes, asset protection laws, sales tax, cost of living, estate planning, and more.
@@llcuniversity I see. Ok. I’ll keep researching.
Thank you.
@@sharejer - You're welcome.
Hi Matt, I need your help with should I be filing DBA or LLC.
Hi Darius, we've broken DBA vs. LLC here: www.llcuniversity.com/dba/do-i-need-to-file-a-dba/
@@llcuniversity I am planning on starting a coaching business, I am trying to figure out which one I need for my business.
@@TheOne102884 - Hi Darius, the link I provided should help you. A DBA just by itself is usually a DBA for a Sole Proprietorship. And LLC can have a DBA, but it's not required.
If I was to do a DBA first and later on decided that I needed an LLC, could I put the DBA under the LLC or would I need to have the LLC first?
Hey Darius, it's a lot easier to just start with an LLC. If you start with just a DBA, it's really a Sole Proprietorship. Depending on the state (or county), you'd either need to file a transfer of the DBA from yourself to the LLC or cancel the first DBA and refile under the LLC. However, a larger thing to consider is "converting" from a Sole Proprietorship to an LLC. That's a lot more involved. If you're on the fence between LLC and Sole Proprietorship, it's best to wait until you are sure which one. More details on that "conversion" here: www.llcuniversity.com/change-convert-sole-proprietorship-to-llc/
I’m in a position of deciding to get LLC in Nevada but will it be worth it for dog breeding would they help me start my dog breeding buisness
Where will you be doing business? Where are you located?
@@llcuniversity Henderson nv Las Vegas
@@imdreamalitymarley7395 - Okay, nice. Sorry, I thought you were out-of-state for some reason. We have details about Nevada LLC formation and costs here: www.llcuniversity.com/nevada-llc/
Dear Mr. Matt,
I am a non-US resident and I have established my LLC and have got my EIN with US physical address, and now I need to open a business bank account with a trusted US bank, so are you providing these services, or do you know any trusted lawfirm agent whose providing this service for non-US residents people like me?
Thanks!
Hi Kar, because of KYC (know your customer) rules and other laws, we don't know of any legitimate service that can open a bank account for you. If you find a service, they are usually a scam. However, you can open a bank account yourself online. We have the information here: www.llcuniversity.com/foreigners/open-us-bank-account-llc-non-resident/
@@llcuniversity Dear Matt,
I tried couples of times with Mercury but they rejected my request and they don't mention the reason. I sent them the article of organization, operating agreement, and EIN. does anything is missed with my LLC documents please?
Hi Kar, they typically also like a detailed description and maybe a website or a LinkedIn profile. The more details you send them, the better. You can also checkout TransferWise (now called Wise) for opening a bank account online.
@@llcuniversity Thank you so much dear Matt,
Does Transfer wise is an online bank like Mercury?
@@montero7980 - Yes, they are online and similar to Mercury. Hope that helps.
Hello I have a question to ask? How do you check the status of your LLC?
Hi Karen, most states don't have such a feature. You just have to wait. In what state did you file and on what date? Did you file by mail or online?
Texas and may 4th
@@llcuniversity and by mail
Hi Karen, approval for mail filings (not including mail time) is typically 7-10 business days. However, due to the pandemic, there are delays at the state and sometimes with mail delivery. Having said that, Texas is one of the few states that has a filing tracker: webservices.sos.state.tx.us/filing-status/status.aspx - Hope that helps!
@@llcuniversity thank you so much.
Can we get in contact with you for questions?
Hi Shanti, can you place a question or two here and we'll reply? Thanks.
@@llcuniversity how can I become what you do on llc university? Is there any qualifications I need , I’m in college right now and own my own jewelry business . But a lot of my clients & friends want personal insight how to start business and llc ‘s . Can I charge other people to give them information?
Hi Shanti, yes, you certainly can. Sounds like consulting or coaching. Just tell someone your rates and provide value :)
Will government help me fund music buisness as well
There might be some programs out there, but we're not sure as we don't work with grants.
Hi my guy need ya help again you help me get my LLC in 2013 I need ya help
Hi there, what do you need help with?