How to Form an LLC
in North Carolina

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Quick Start Guide ← you are here
This Quick Start Guide is a brief overview of how to form an LLC in North Carolina.

Detailed Lessons:


North Carolina LLC Costs:
North Carolina LLC filing fee: $125 (one-time fee)
North Carolina LLC annual report fee: $200 per year

Need to save time?
Hire a professional to form your North Carolina LLC:
Northwest ($39 + state fee) or LegalZoom ($149 + state fee)

★ Check out Northwest vs LegalZoom

Here is a quick overview on starting an LLC in North Carolina

Matt Horwitz LLC University Founder

Hi there, my name is Matt Horwitz and I’m the founder of LLC University®.

We’ve put together a free guide on how to form an LLC in North Carolina. We hope you find it helpful!

To form a North Carolina LLC, you can either follow the 7 lessons above (which are more detailed and step-by-step), or you can follow our Quick Start Guide below (which is a brief overview of all the steps).

If this is your first time setting up an LLC in North Carolina, I recommend that you follow the more detailed lessons above. Please make sure to follow them in order.

How to Form an LLC in North CarolinaA North Carolina LLC (Limited Liability Company) is a hybrid business entity which encompasses the best features of a Sole Proprietorship, Partnership, and a Corporation. These include:

  • Easy management
  • Pass-through taxation (no double taxation)
  • Personal liability protection

The third feature (personal liability protection) is what makes North Carolina LLCs so popular among business owners and entrepreneurs.

How personal liability protection works:

As a separate legal entity, your North Carolina LLC can be used to run a business or it can be used to hold assets, like real estate, boats, vehicles, and aircraft.

If somebody were to sue your LLC, they can only go after the LLC’s assets. Your personal assets (like your home, cars, and your bank account) cannot be used as payment for the lawsuit. The personal liability protection that a North Carolina LLC provides ensures that your personal assets remain out of reach from creditors.

Need to save time? Hire a professional to form your NC LLC:
Northwest ($39 + state fee) or LegalZoom ($149 + state fee)

(check out Northwest vs LegalZoom)

1. North Carolina LLC Name

• The first step to creating your LLC with the North Carolina Secretary of State is to come up with a unique LLC name and make sure it’s available to use.

• Your desired North Carolina LLC name must be “distinguishable upon the records”. Meaning, it must be unique from the names of all the existing businesses registered with the North Carolina Secretary of State.

• North Carolina LLC Name Search:

LLC Designator: Your LLC must have a proper designator at the end of the name. As per North Carolina LLC law, the acceptable designators are: “LLC”, “L.L.C.”, “Limited Liability Company”, “Limited Liability Co.”, “Ltd. Liability Company” or “Ltd. Liability Co.”.

Quick Tip: If you’re not sure which designator to use, “LLC” is the most common.

• Your North Carolina LLC name cannot include a designator from a different type of legal entity. For example, your LLC name cannot include the words or abbreviations Corporation, Corp., Inc., Incorporated, Limited Partnership, LP, L.P., or Trust.

North Carolina LLC Name statutes:
§ 55D-20
, 18 NCAC 04 .0502, 18 NCAC 04 .0503

2. North Carolina Registered Agent

• In order to do business in the state, your LLC must maintain a North Carolina Registered Agent at all times.

• A North Carolina Registered Agent is a person or company who accepts legal mail and paperwork addressed to your North Carolina LLC. This paperwork includes notice of lawsuits, court hearings, and subpoenas. Together, this type of legal mail is known as Service of Process.

• Not maintaining a North Carolina Registered Agent can be grounds for the Secretary of State to administratively dissolve your LLC. This means you won’t be able to do business in the state any longer.

• Your North Carolina LLC’s Registered Agent must have a street address located within the state. PO Boxes are not allowed to be used.

• If your LLC’s Registered Agent will be an individual person, then he/she must also be at least 18 years of age and be a resident of North Carolina. If you, a friend, or family member meet these requirements, then you/they can be your North Carolina LLC’s Registered Agent.

• Alternatively, you can hire the services of a professional Registered Agent, technically known as a Commercial Registered Agent in North Carolina.

• A Commercial Registered Agent is a private company that you pay on an annual basis. They fulfill the North Carolina state requirement of maintaining a Registered Agent, as well as additional benefits, such as privacy (keeping your address off public records), emailing you about Annual Report reminders, and discarding your junk mail.

• If you want to hire a Commercial Registered Agent in North Carolina, we recommend Northwest Registered Agent ($125 per year).

Northwest has been in the business for over 20 years and they have great customer support. Any mail that is sent to your LLC will be scanned by them and uploaded to your online account.

Important: If you would like to keep your address off the public records, then we recommend Northwest Registered Agent. They’ll let you use their address not only in the Registered Agent section of your filing, but you can also use their address for your Principal Office Address and in the signature section as well. No other Registered Agent company will allow you to do this without charging extra. Northwest Registered Agent offers this at no additional charge.

Special offer: If you hire Northwest to form your North Carolina LLC ($39 + state fee), their registered agent service is free for the 1st year.

(to learn more about Northwest, check out our Northwest Registered Agent review)

North Carolina Registered Agent statutes:
G.S. 57D-2-40 and G.S. 55D-30

3. North Carolina LLC Articles of Organization & Cover Sheet

North Carolina LLC filing form:
– Go to:
– Choose “Business Registration” from the “Within the Department” drop down menu.
– Choose “Limited Liability Company” in the second drop down menu.
– The Articles of Organization (L-01) will appear at the very top of the section. Click on the hyperlink to download a copy in PDF format.

Cover Sheet form:
– Go to:
– Choose “Business Registration” from the “Within the Department” drop down menu.
– Make sure “Business Entities Common” appears in the the second drop down menu (it will show up by default).
– The Cover Sheet for Corporate Filings will appear at the very top of the section. Click on the hyperlink to download a copy in PDF format.

North Carolina LLC filing fee: $125 (one-time filing fee)

Methods of filing: You can file an LLC in North Carolina online or by mail.

Either way, you must first complete the paper forms: the Articles of Organization and the Cover Sheet, and then you can upload them online or send to the state by mail.

North Carolina LLC approval times:

– Your North Carolina LLC will be approved in 3 – 5 business days if you file online.
– Your North Carolina LLC will be approved in 4 – 6 business days if you file by mail.

Note: Filing times may take longer due to the current global situation and government delays. Please see how long does it take to get an LLC in North Carolina.

File your North Carolina LLC online: Go to the North Carolina Secretary of State’s website, create an online account, then look in the left navigation under “Online Services”. Click “Create a Business Online”, then follow the online instructions. Submit payment with a debit or credit card.

File your North Carolina LLC by mail: Prepare a check or money order for $125 and make it payable to the “Secretary of State”. Then mail your completed Articles of Organization, the Cover Sheet, and filing fee to:

North Carolina Secretary of State
PO Box 29622
Raleigh, NC 27626-0622

North Carolina LLC approval: If you file your North Carolina LLC online, the approval documents listed below will be returned by email. If you file by mail, they’ll be returned by regular mail. After the Secretary of State approves your LLC, you’ll receive back the following:

– Stamped and approved copy of your Articles of Organization
– Cover Letter acknowledging the successful formation of your LLC

Need to save time? Hire a professional to form your NC LLC:
Northwest ($39 + state fee) or LegalZoom ($149 + state fee)

(check out Northwest vs LegalZoom)

North Carolina LLC Articles of Organization statute: G.S. 57D-2-21

4. North Carolina LLC Operating Agreement

• If the Articles of Organization is the document that forms your LLC, then the Operating Agreement is the document that governs it.

• Unlike the Articles of Organization, you don’t need to file your Operating Agreement with the North Carolina Secretary of State (or with any other agency for that matter). The Operating Agreement is an “internal document”, meaning you just a copy with your LLC/business records.

What does an Operating Agreement usually contain? Names of the owners (called members), how much of the LLC each member owns, how the LLC is managed, how the business is run, the duties and responsibilities of the owners, managers, and officers, how taxes are paid, and how profits are distributed.

Note: Operating Agreements are not limited in nature. If necessary, you can add any additional provisions or sections.

Why having an Operating Agreement is important? It provides a written document for how to handle disputes and arguments among the members. It spells out the “bylaws” of how to run your North Carolina LLC. Having an Operating Agreement can also help maintain your personal liability protection (it’s very important to have if you ever end up in court).

Single-member LLC & Multi-member LLCs: regardless if your LLC has one member or several members, it’s always a good idea to have an Operating Agreement for your North Carolina LLC LLC.

Free North Carolina LLC Operating Agreement: You can download a free North Carolina Operating Agreement in one of the following 3 formats:
PDF, Google Doc, or Microsoft Word
(Just choose your preference. They are all the same form.)

North Carolina Operating Agreement statutes:
G.S. 57D-2-30, G.S. 57D-2-31, G.S. 57D-2-32

5. Federal Tax ID Number (EIN)

• After the North Carolina Secretary of State approves your LLC filing, then you can obtain a Federal Tax ID Number from the IRS.

• A Federal Tax ID Number is your North Carolina LLC’s “social security number”. It is used by the IRS to identify your LLC for taxation and reporting purposes.

• A Federal Tax ID Number is also called an Employer Identification Number (EIN), Federal Tax ID Number, and Federal Employer Identification Number (FEIN). They are all referring to the same thing though.

Why do you need an EIN? Your LLC will need a Federal Tax ID Number to open a business bank account, register for business licenses and permits, and to transact business with other companies..

When to apply: Do not apply for your Federal Tax ID Number until your LLC is approved by the North Carolina Secretary of State. If your LLC filing is rejected for some reason, you will be attaching the Federal Tax ID Number to a non-existent LLC.

EINs are free: Federal Tax ID Numbers (EINs) are free. The IRS does not charge anything (although some sites in the industry may lead you to believe otherwise).

Apply for an EIN: You can apply for Federal Tax ID Number in one of three ways. You can apply online (takes 10-15 minutes to get your EIN), by fax (takes 4 business days to get your EIN), or by mail (takes 4-6 weeks to get your EIN).

Online EIN application: This is the recommended method since it’s very quick to complete the EIN application (takes 10 to 15 minutes), and at the end of the application the IRS will provide you with a PDF document with your EIN to print and save. You can only use the EIN online application if you have an SSN or ITIN. Your LLC must also be owned by an individual, or individuals, (not another company) in order to apply online.

Apply by fax or mail: Those without ITINs or SSNs, or whose LLCs are owned by another company, can still apply for a Federal Tax ID Number, not just through the online application. Instead, download Form SS-4 (fill it out and sign it), then send to the IRS by fax or regular mail:

IRS Fax number: 855-641-6935

IRS Mailing address: Internal Revenue Service, Attn: EIN Operation, Cincinnati, OH 45999

Foreigners: On line 7b, just write “Foreign” if you don’t have an SSN or ITIN.

6. North Carolina LLC Annual Report

• All LLCs in North Carolina must file an Annual Report every year in order to remain in good standing with the state.

• The first Annual Report is due by April 15th of the year following your LLC’s year of formation. For example, if your North Carolina LLC was formed on November 15th 2022, your first Annual Report will be due by April 15th 2023. Then it will be due by April 15th 2024, and so on.

North Carolina LLC Annual Report Fee: $200 per year.

Annual Report approval times:

– Your LLC’s Annual Report will be approved in 3 – 5 business days if you file online.
– Your LLC’s Annual Report will be approved in 4 – 6 business days if you file by mail.

Recommendation: We recommend the online filing as it’s easier to complete. However, if you’re not very tech-comfortable, then we recommend filing by mail.

How to file your North Carolina Annual Report online:

– Search for your North Carolina LLC on the state’s website, then look to the right of your LLC name. Click the “File Report” link. Complete the online filing and then pay online with a debit or credit card.

How to file your North Carolina Annual Report by mail:

– Search for your North Carolina LLC on the state’s website, click on your LLC name, then click the link at the top titled “Print a Pre-Populated Annual Report form”.

– Complete the form, sign it, and mail to the North Carolina Secretary of State’s office with your Annual Report filing fee. Pay by check or money order and make it payable to “Secretary of State”.

– Send your completed Annual Report and filing fee to:

North Carolina Secretary of State
PO Box 29525
Raleigh, NC 27626-0525

Penalty: if you do not submit your North Carolina LLC Annual Report within 60 days of the due date, then your LLC may be administratively dissolved and shut down by the state.

What you’ll get back: Once the North Carolina Secretary of State’s office is finished processing your LLC’s Annual Report filing, you will get back the following 2 items:

– Copy of the filed Annual Report
– Cover Letter acknowledging your successful filing

The above items will returned by email if you file online. Or they’ll be returned by regular mail if you file by mail.

North Carolina Annual Report statute: G.S. 57D-2-24

7. Business Licenses and/or Permits

• Your LLC must have the necessary business licenses and/or permits in order to do business in North Carolina.

• The specific type of license and/or permits your North Carolina LLC may need depends on its location and what industry it is involved in.

• Contact your local county officials, and North Carolina’s state agencies to determine the specific business licenses and/or permits your LLC will need.

• If your LLC will render professional services (medicine, accounting, law, etc.), you must also obtain a license from the relevant regulatory board. NC Careers keeps a comprehensive directory of professional licenses available in the state: NC Business and Occupational License Database

One-on-one business consultation: Business Link North Carolina (BLNC) is a free service to help you determine what kind of business licenses and/or permits your LLC may need. One of the BLNC business counselors will be happy to help you.

Need to save time? If you’d rather not do the research to determine your North Carolina business license and permit requirements, we recommend hiring IncFile.

8. North Carolina LLC Taxes

Federal taxes: By default, LLCs have “pass through” taxation in North Carolina and the rest of the U.S. states. Any income generated or losses incurred by your LLC are not taxed separately (federally). Instead, they are usually listed on a Schedule C (or a different Schedule depending on how you derive your income) and filed with the IRS together with your personal 1040 tax return.

North Carolina State and local taxes: You have to register with the North Carolina Department of Revenue and with the municipality (county, city, town, etc.) where your LLC is located for taxation purposes.

North Carolina imposes the following taxes: alcoholic beverages, certain machinery and equipment tax (1% Privilege Tax), corporate income tax, corporate franchise tax, dry cleaning solvent tax, estate tax, estates and trusts (fiduciary), individual income tax, insurance premium tax, International Fuel Tax Agreement (IFTA) tax, motor fuels tax, motor vehicle lease and rental tax, partnerships, privilege license tax, property tax, sales and use tax, scrap tire disposal tax, severance tax (effective July 1, 2015), solid waste disposal tax, tobacco products, unauthorized substance tax, white goods disposal tax, withholding tax, and more.

Recommendation: Determining your tax obligations yourself can be challenging. We recommend you get help from an accountant in North Carolina after your LLC is formed. Check out our how to find an accountant guide.

9. North Carolina LLC Bank Account

• After getting your LLC’s Federal Tax ID Number, you can now open a separate bank account for your LLC in North Carolina.

Separating assets: Not only does having a business bank account and a personal bank account make your accounting life much easier, it also helps protect your personal assets. Giving your LLC a separate checking account helps avoid commingling personal assets and business (one of the common reasons an LLC can lose its liability protection).

Items needed to open account: North Carolina LLC Articles of Organization (stamped and approved ), Federal Tax ID Number (also called EIN), and usually two forms of ID, such as a driver’s license and a passport. We recommend calling a few banks ahead of time though, as some banks may ask for additional documentation, such as your LLC’s Operating Agreement.

• If you LLC has multiple members, then all the members should be present when opening the bank account. If you need to add a member at a later date, you’ll need to speak to your specific branch location regarding the procedure, as each bank operates differently.

LLC banking fees: We recommend calling a handful of banks in North Carolina close to where you do business. Ask them about their “simplest form of business checking account” and ask what the monthly maintenance fees are. A lot of banks in North Carolina charge monthly fees, but about 25% or so do not. We recommend speaking to about 5-6 banks in order to find free business checking.

Debit card: The bank will give you a debit card when you open the account.

Credit card: You can also get a business credit card to earn points, miles, and other rewards.

10. Business Phone Number

Instead of using your home telephone number or your cell phone, you can purchase an affordable “virtual business number” specifically for your North Carolina LLC. You can set this virtual business phone up to forward to your cell phone, go through voice prompts, or configure it any way you’d like.

We recommend using as they have the cheapest plans and their customer service is excellent.

They offer local phone numbers as well as 1-800 toll-free numbers. You can easily setup call forwarding, pre-recorded prompts, and get voicemail messages forwarded to your email.

Getting a separate business phone number for your North Carolina LLC is also a good idea in order to keep your actual number private from those pesky “public record” websites.

North Carolina State Agencies

North Carolina Secretary of State
Corporations Division
Phone: 919-814-5400
Hours: 8am – 5pm, Monday through Friday (Eastern)

North Carolina Department of Revenue
Phone: 877-252-3052
Hours: 8am – 5pm, Monday through Friday (Eastern)

Matt Horwitz

Matt Horwitz
Founder & Educator, LLC University®
Matt Horwitz has been the leading expert on LLC education for the past decade. He founded LLC University in 2010 after realizing people needed simple and actionable instructions to start an LLC that other companies weren't offering. He's cited by Entrepreneur Magazine, Yahoo Finance, and the US Chamber of Commerce, and was featured by CNBC and InventRight.
Matt holds a Bachelor's Degree in business from Drexel University with a concentration in business law. He performs extensive research and analysis to convert state laws into simple instructions anyone can follow to form their LLC - all for free! Read more about Matt Horwitz and LLC University.

41 comments on “North Carolina LLC”

Disclaimer: Nothing on this page shall be interpreted as legal or tax advice. Rules and regulations vary by location. They also change over time and are specific to your situation. Furthermore, this comment section is provided so people can share their thoughts and experience. Please consult a licensed professional if you have legal or tax questions.

  1. If I want to use the name for a LLC in North Carolina that has been used previously by another person and is now listed as dissolved, how long do I have to wait?

    • Hey Brian, apologies for the slow reply. I’m not in front of our all our NC data on the moment, but if you call the state tomorrow (919-807-2225) they’ll tell you how long. Their hours are hours are 8am – 5pm. Hope that helps!

  2. What if you have an Llc that is taxed as a corporation. Do you pay $200 or $25?

    • Hi Mandy, I am not 100% certain on this one. Can you please call the NC Secretary of State (919-807-2225, 8am – 5pm) to check. I’d be curious to hear what you find out!

  3. How can I turn my current LLC into S-Corp are Corporation ? If I was looking to incorporate another business into my current LLC ? Do I merger them together ? Are do I just file a new LLC with NC ? Thanks

    • Hi Anthony, an “LLC to C-Corporation” would be a conversion. An “LLC to S-Corporation” can either be a conversion (form a C-Corporation then elect subchapter S taxation with the IRS), or you can file Form 2553 with the IRS and have the LLC be taxed as an S-Corporation. A lot of people want to form a company under another company (ex: LLC ABC owns LLC XYZ) without a whole lot of reason. Unless your accountant and/or attorney has advised this strategy, it’s simplest to form a new LLC with you as the owner. Having said that, there are a lot of ways to go about this. Hope that helps. Let me know if you need more info.

  4. Hi Matt, on the new cover sheet for NC at the bottom it ask for the business entity and type of document, do I need to fill this part out, if so what would I put? I would greatly appreciate your assistance.


    • Hey Natasha, to the right of “Name of Entity”, enter your LLC name. To the right of “Type of Document”, enter “L-01, Articles of Organization”. Hope that helps!

  5. Hey Matt,
    The ONLY way I got through starting an LLC was through your youtube videos. They were GREAT!
    question…now that I have my LLC registered, is there a check list of everything that needs to be filed? Taxes, employer taxes (I am self employed but still confused). just want to make sure I don’t miss anything. suggestions of where I might find a checklist?


    • Hey Stephanie, AWESOME to hear! Make sure you go over the NC LLC Annual Report lesson so you’re aware of that requirement. Regarding taxes, there is variance among business owners, so instead of a checklist, we recommend that you speak with an account or two regarding the specifics to your situation. Hope that helps!

  6. Matt,

    Thanks a lot for putting all together. It gave me clear understanding of everything, This is great resource for LLC.

    • Hey Anand, you’re very welcome! Thank you for your nice comment.

  7. I am creating several websites for several eCommerce shops that will sell physical products in different niches.
    Please, how do I form an LLC to take care of these several shops (about 4 shops)?
    Since the shops belong to the same person does it make sense to register an LLC for each shop or can I register an LLC and have the 4 shops under it? How do I go about bringing 4 shops under one LLC company?
    Thanks for any help you can give.

    • Hey Chux, after you form the LLC, make sure the domain ownership and website hosting information is updated to reflect the LLC name. You’ll also want to sign a bill of sale and sell the domain + website from yourself to the LLC. Going forward, operate the business and register things under the LLC name… not your personal name. Hope that helps.

  8. Matt,

    I’ve looked over the information for North Carolina and am still confunsed. Does North Carolina require all members be listed on the Articles of Organization filed with the Sec of State? Thanks


    • Hi Brandon, no, LLC Members are not required to be listed in the North Carolina Articles of Organization. Hope that helps.

  9. I am so excited! Mailing my information to create my real estate LLC. No longer will I be liable hahah

    • Awesome man! Congratulations :) And best wishes with the business!

  10. Thanks man and that answer was a big help and saved me some money.

  11. My husband is looking to get a LLC for himself as a driver with a pharmaceutical company and to sell food? He currently drives under someone else’s LLC as an employee and was adviced to get his own LLC. He also cooks for someone else at festivals and was also advices to get his own LLC. We just need to know does this warrant for two separate LLCs or could one be used?

    • Hi Shada, you could form 2 different LLCs, but you don’t have to. You can run multiple business activities under one LLC. Hope that helps.

  12. Hi Matt,
    Can you explain further how to run multiple businesses under one LLC.
    How do you provide proof legally to your bank and online payment gateways that all the businesses are one and the same LLC?
    Thanks for your help.

    • Hey Christian, if you’re running multiple different business activities under one LLC (as opposed to a different LLC for each business), then it’s easier to think of it just like this: “multiple business activities” under one LLC, not “multiple businesses” under one LLC. So in that case, you’re just opening a bank account for your LLC as well as using the LLC name when registering/setting up your payment gateways. Hope that helps!

  13. Hi Matt,

    I just received my bartending certification and am in the process of getting an LLC in order to bartend at private events. First question I have is is an LLC the right move for establishing myself as a brand/business. Second, is it possible to add my business under a trust to ensure business expenses can be written off?

    • Hi Candice, you don’t have to form an LLC for your business, but you certainly can. You could also operate as a Sole Proprietorship. We have details on the differences here: LLC vs Sole Proprietorship. While yes, you can make your Trust the owner of an LLC, you don’t have to do so in order to write off business expenses. You can write of business expenses as a Sole Proprietor, the owner of your LLC, and if your Trust owns the LLC. Hope that helps!

  14. Im buying a rental property in Florida and I live in NC, does my LLC have to be in the same state as the business? Or can it be in the state I live in?

    • Hi Nancy, you’re supposed to form the LLC in the state where the property is located, since this is where you’re doing business. If you purchased the FL property with a North Carolina LLC, you may need to register your North Carolina LLC as a Foreign LLC in Florida. Hope that helps.

  15. how to form husband and wife LL C in north Carolina? single ll c member or partnership?
    how they taxed? husband and wife they used to file tax jointly
    what to elect s corp or c corp?

  16. HI Matt – Considering forming an LLC to make my next home purchase under (and then subsequent land investments). I haven’t made the purchases yet. Two questions: 1) will banks expect mortgage payments to be made from an account in the LLC name (which means transferring funds monthly from personal checking to the business) or can I pay them from my personal account? and 2) does insurance for the home need to be in the LLC’s name?

    • Hi Zinzi, generally speaking, most banks don’t care where funds come from. However, you’ll certainly want to confirm this with your bank. The insurance policy should be in the name of the LLC.

  17. Hi Matt,
    Thank you for providing this valuable resource.
    As we all know LLC is an asset protection when something happens related to the business. For example if something happens in your real estate owned by an LLC, your personal assets are not in danger. But now if something happens to you, they can come after your belongings managed by LLC. Would you please elaborate on that and explain how we can mitigate the risk? Can a commercial Registered agent in NC hide your name and your belongings (LLCs)? or we need to use land trust and anonymous LLC?

    • Hi Al, you’re very welcome. What you’re referring to is whether or not a charging order is the exclusive remedy of a judgement creditor in North Carolina and whether or not LLC foreclose is expressly precluded (not allowed). While the first is true in North Carolina (exclusive remedy), the relevant statue (North Carolina General Statute, Section 57D-5-03, see d), is “silent” in regards to foreclosure being expressly precluded. However, most asset protection attorneys would still consider the North Carolina law pretty strong when compared to other states.

      But charging orders and foreclose rules go far beyond the statute. You must look at the case law (or better yet, hire an attorney to do so). It also depends on if the North Carolina LLC as a Single-Member LLC or Multi-Member LLC. The North Carolina Statute is silent as to whether or not charging order protection applies to a Single-Member LLC (so you need to look to case law). Charging order protection comes from Partnership law. And some courts can interpret the charging order protection to not be relevant in a Single-Member LLC (since there are no other members to protect). It really does get into the nitty-gritty details. This reply isn’t meant as an answer, but rather, I wanted to paint some context on what to look out for. Also, this is assuming you reside in North Carolina. Charging order protection and LLC foreclosure laws most often apply to where the owner resides and not where the LLC is formed.

      And while a Commercial Registered Agent may keep your name and address off of the North Carolina LLC Articles of Organization (at least for the Registered Agent section)… and even if you fully anonymized the LLC’s Articles of Organization, it wouldn’t matter in a personal lawsuit. Your ownership in the LLC would come out in court, especially if a judgment were entered against you. And regarding the use of Land Trust (or any type of Trust), it’s best to speak to an asset protection attorney. Too many details to get into due to the variation.

      The best way to mitigate this is to speak with an asset protection attorney (or a few) in North Carolina. Then the next line of defense would be making the LLC a bonafide Multi-Member LLC. Then increase your car insurance coverage (car accidents can lead to personal lawsuits). And ask your car insurance company to issue you a personal umbrella insurance policy (typically you can get $1M to $5M for a reasonable premium). Other companies will also issue personal umbrella insurance policies, too. Hope that helps!

      p.s. Here are some relevant articles about North Carolina’s charging order protection laws:
      Tuggle Duggins: Charging Orders And North Carolina: How to get at a Debtor’s LLC Interest
      Maryland State Bar Association: Limited Liability Company Charging Orders Part II Charging Order Protections: Exclusivity, Foreclosure and Single Member LLCs

      • Thank you for your comment, Matt.
        As much I read and learn more about it, it seems more and more complicated, specially when it comes to banking, mortgage/Loan, tax, collecting rents, marketing and so on.
        For now I added the umbrella insurance as you mentioned, because it was just a phone call :-)
        In the next step, I am going to create LLCs and will transfer the properties. That causes it’s own issues, like transfer tax and due on sale clause. A possible solution could be a Land Trust, …

        Another dilemma: how to buy a new property by collecting funds from other properties’ LLCs? who will be the owner of the new LLC? (The relation between old LLCs and the new one)
        It seems I need a CPA and an Attorney. Do you have good referrals in NC?

        • Yes, it’s all a puzzle that takes time to put together. I spent over 6 months doing my own estate plan. It was a lot to digest. And even after putting the proper things in place (i.e. LLCs, Trusts, insurance, etc.), there’s the practical part of putting it all together and making it work… the logistics and the administration of it all. Said another way, the overwhelm is normal ;) Awesome on the umbrella insurance though. That’s a quick win!

          That makes sense about the Land Trust. Definitely speak with a few real estate attorneys and/or titles companies. There are sometimes ways around the transfer tax (or a very reduced rate). It depends on the municipality that governs though.

          Dilemma: You can first distribute the proceeds from Old LLC to the owner (I’m assuming that’s you) and then you make a capital contribution to the New LLC. Another thing to consider is a simple loan. Old LLC loans the money to New LLC. We don’t have any referrals at this time (wish we did). Our best advice is to list out a handful of questions and spend the better part of day asking the same questions to a handful of people. Compare the answers against each other. Additionally, you may gravitate towards one person (by just getting a gut feeling). Typically, we’d say meet them for coffee. However, maybe a Zoom chat will do. Just to see if you like them personally and professionally.

            • You’re welcome Al. One more thought: if an attorney recommend a specific strategy(ies), ask for relevant case law to see if the recommendation has weight. Happy Holiday :)

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Non-US residents: If you want to form an LLC in the US, we recommend hiring doola.

doola specializes in forming US LLCs for international entrepreneurs.

They'll form your LLC, open your business bank account, and help with taxes. doola also has excellent customer service.

Hope that helps!

Matt Horwitz founder of LLC University
Matt Horwitz
Founder & Educator
LLC University®