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How to Form an LLC in South Carolina
Quick Start Guide:
How to form an LLC in South Carolina ← you are here
South Carolina LLC costs:
LLC formation: $125 online or $110 by mail
Annual report: None (for most LLCs)
(check out Northwest vs LegalZoom)
An LLC can be used to operate a business, or an LLC can be used to hold assets (such as real estate, vehicles, boats, or aircraft).
To form an LLC in South Carolina:
– follow the 8 lessons above (more detailed and step-by-step), or
– follow the Quick Start Guide below (the brief overview)
Northwest ($39 + state fee) or LegalZoom ($149 + state fee)
(check out Northwest vs LegalZoom)
1. South Carolina LLC Name
• Before filing your LLC with the South Carolina Secretary of State, you need to make sure your desired LLC name is available.
• Your desired South Carolina LLC name must be “distinguishable upon the records”. In other words, your LLC name must be unique when compared to existing businesses that are registered with the South Carolina Secretary of State.
• South Carolina LLC Name Search:
• LLC Designator: Under South Carolina’s Uniform Limited Liability Company Act (Section 33-44-105), your LLC must end with the proper designator. Acceptable designators include the following:
– Ltd. Liability Co.
– Limited Liability Co.
– Ltd. Liability Company
– Limited Liability Company
Tip: If you’re not sure which designator to use, “LLC” is the most common.
• Your South Carolina LLC name cannot include a designator that makes it sound like 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.
2. South Carolina Registered Agent
• A South Carolina Registered Agent receives notices, legal mail, and court documents (called Service of Process) in case your LLC is involved in a lawsuit. Your South Carolina LLC’s Registered Agent can either be a person or a company.
• In order to do business in the state, your South Carolina LLC is required to maintain a Registered Agent. If your LLC fails to maintain a Registered Agent, then the South Carolina Secretary of State can administratively revoke your LLC. In the event this happens, you won’t able to do business in the state.
• Your South Carolina LLC’s Registered Agent must have a physical street address within the state where notices and other documents can be served. This enables process servers (people who deliver legal documents) to properly deliver legal mail and court documents to your South Carolina LLC. PO Boxes are not allowed to be used for a Registered Agent address.
• Aside from a street address, your South Carolina LLC’s Registered Agent should also be available during normal business hours (9am to 5pm) from Monday through Friday in case service of process arrives.
• Who can be your LLC’s Registered Agent in South Carolina?
1st choice: You can be your LLC’s Registered Agent.
2nd choice: A friend or family member can be your LLC’s Registered Agent.
Note: If your Registered Agent is going to be either of the first two choices, then they also need to be a resident of South Carolina and be at least 18 years of age.
3rd choice: You can hire a Commercial Registered Agent if you don’t have an address in South Carolina, or if you prefer to have a company take care of this role.
• Commercial Registered Agent: If you need to hire a Commercial Registered Agent in South 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.
3. South Carolina Articles of Organization
• South Carolina LLC form: “Articles of Organization”
• South Carolina LLC filing fee: $125 (online filing) or $110 (mail filing)
• South Carolina LLC approval times:
– Your LLC will be approved in 1 – 2 business days if you file online.
– Your LLC will be approved in 10-14 business days if you file by mail.
• File your South Carolina LLC online (recommended method): https://businessfilings.sc.gov/BusinessFiling/Account/Register
• File your South Carolina LLC by mail: http://www.sos.sc.gov/forms/LLC/Domestic/ArticlesofOrganization.pdf
– Pay by check or money order and make payable to “South Carolina Secretary of State”.
– Mail your $110 filing fee, along with 2 copies of the completed Articles of Organization, and a self-addressed stamped envelope to: Secretary of State, Attn: Corporate Filings, 1205 Pendleton Street, Suite 525, Columbia, SC 29201.
• South Carolina LLC approval:
You will get back a stamped and approved copy of the Articles of Organization and a Filing Receipt. If you file online, these will be emailed to you in 1-2 business days. If you file by mail, these will be returned by mail in 10-14 business days.
4. South Carolina LLC Operating Agreement
• Your South Carolina LLC’s Operating Agreement is where you will list the owners (called “Members“) of your LLC, as well as how much of the business they own. You can have 1 member with 100% ownership, or you can have multiple members and split the ownership any way you’d like.
• There are no rules as to how you split ownership in a multi-member South Carolina LLC. You’ll decide that amongst yourselves.
• The LLC’s Operating Agreement will also spell out how the LLC is taxed, how the business is managed, and how profits are split.
• Even if your South Carolina LLC has 1 member (“single-member LLC”), it’s still best practice to have an Operating Agreement in place. This helps keep your personal assets protected in the event of a lawsuit.
• Your Operating Agreement does not need to be mailed to the South Carolina Secretary of State, or any other agency for that matter. It’s an internal document, meaning, you just keep it with your business records and give a copy to all members.
5. Federal Tax ID Number (EIN)
• A Federal Tax ID Number is your South Carolina LLC’s “social security number”. It is used by the IRS to identify your LLC, mainly for tax purposes.
• Other names: A Federal Tax ID Number is also known as an Employer Identification Number (EIN), Federal Tax ID Number, and Federal Employer Identification Number (FEIN), but they all mean the same thing.
• Uses of an EIN: Opening bank accounts, applying for certain business licenses and permits, and transacting with other businesses.
• Wait for your LLC to be approved: Wait for your South Carolina LLC to be approved before you apply for a Federal Tax ID Number. If you don’t, you could end up having an EIN attached to a non-existent LLC (in case your filing is rejected by the South Carolina Secretary of State).
• EINs cost $0: Applying for a Federal Tax ID Number is a free service provided by the IRS.
• How to apply: You have three options on how to apply for a Federal Tax ID Number from the IRS:
We recommend applying online since the approval time takes around 10-15 minutes, as opposed to filing by fax (4 business days) and filing by mail (4-6 weeks).
• Form SS-4: If you need to file by mail or fax, you can download the form above, complete and sign it, then send it to the IRS:
Mailing address: Internal Revenue Service, Attn: EIN Operation, Cincinnati, OH 45999
Fax number: 855-641-6935
• Don’t have an SSN or ITIN? (foreigners): Those without SSNs or ITINs (as is usually the case for foreigners) can still apply for a Federal Tax ID Number. However, they can only apply by downloading Form SS-4 and filing it by fax or by mail (the online application won’t be accepted).
Tip: On line 7b, just write “Foreign” if you don’t have an SSN or ITIN.
• LLC owned by an existing company: Company-owned LLCs also can’t use the online application. You’ll have to file Form SS-4 by mail or by fax.
6. South Carolina LLC Annual Report
• Good News: The South Carolina Secretary of State doesn’t require LLCs to file Annual Reports.
• The only exception to this rule is if your LLC has elected S-Corp status or C-Corp tax status with the IRS. If that’s the case, then you must file Form CL-1 (Initial Report of Corporations) within 60 days of the South Carolina LLC being formed. And you must also file Form SC 1120 or Form SC 1120S on an annual basis with the Department of Revenue. You can find more details here: South Carolina LLC Annual Report.
7. Business Licenses and/or Permits
• As with many other states, South Carolina does not issue a state-level general business license. However, you may need to get business licenses and/or permits depending on where your LLC is located and its line of business.
• All LLCs doing business in the state must get a South Carolina Tax ID Number from the Department of Revenue. Make sure you already have your Federal Tax ID Number before applying.
• If your LLC will render professional services, then you must contact the South Carolina Department of Labor.
• Need to save time? If you’d rather not make the phone calls and do the research to determine your South Carolina LLC’s business license and permit requirements, we recommend using IncFile.
8. South Carolina State Taxes
• Federal: By default, LLCs are classified as “pass-through entities” by the IRS. This means that your South Carolina LLC’s profits will “pass through” to your personal tax return and are usually listed on a Schedule C (which is a part of your personal US 1040 return). The LLC does not file a separate tax return with the IRS.
• South Carolina Business Personal Property Tax: This is a tax on the furniture, fixtures and equipment that are owned and used to operate a business. Your LLC is required to file this if it has personal property in a business or leases equipment to a business.
• South Carolina also imposes state income tax, excise tax, sales and use tax, withholding tax, and more. You can review them on the Department of Revenue’s website.
• Recommendation: Calculating your federal, state, and local taxes can be complex and time-consuming. If done incorrectly, your South Carolina LLC may be negatively affected. For that reason, we recommend speaking with a few accountants after your South Carolina LLC is formed. Check out our how to find an accountant guide, or you can do a search using Thumbtack or Yelp.
9. South Carolina LLC Bank Account
• After your LLC is approved and you get a Federal Tax ID Number, you can now open a separate bank account for your South Carolina LLC.
• Importance of a separate bank account for your South Carolina LLC: It makes accounting and bookkeeping easier, and it helps maintain your personal liability protection by separating your personal assets from the assets of your LLC.
• Documents to open a bank account for your LLC:
– Stamped and approved South Carolina Articles of Organization
– Federal Tax ID Number (EIN)
– 2 valid IDs (driver’s license, passport, etc.)
Tip: Call the banks ahead of time and ask them if they require other documents (like your LLC’s Operating Agreement, for example).
• Other banking things to know:
– Signers: LLC Members who want to be included as authorized signers on your South Carolina LLC’s bank account must be physically present during the opening of the account.
– Maintenance fees: Many banks charge monthly maintenance fees, but others don’t. To find the best bank to open an account for your South Carolina LLC, we recommend you make a few calls and shop around.
– DBA: A bank representative may sometimes ask for your LLC’s DBA (Fictitious Name). Your LLC does not need to register a DBA if your LLC will be doing under its own name. Sometimes bank representatives get confused about DBAs.
• Debit card: The bank will usually issue a debit card right after the opening of your South Carolina LLC’s bank account.
• Credit cards: Debit cards are great, but they don’t build business credit or get rewards (like cashback and travel points). You can search for business credit cards at www.creditcards.com
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 South 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 Phone.com 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 South Carolina LLC is also a good idea in order to keep your actual number private from those pesky “public record” websites.
South Carolina State Agencies
South Carolina Secretary of State (Division of Business Filings)
Phone: 803-734-2158 (option 1)
Hours: 8am to 5pm, Monday through Friday
South Carolina Department of Revenue
Phone: 844-898-8542 or 803-898-5444 (taxpayer advocate line)
Hours: 8:30am – 4:45pm, Monday through Friday