How to Start an LLC in South Carolina (Step-by-Step) 2023 Guide

20 comments on “South Carolina LLC”

1. Hi Matt. Very helpful information for SC. My partner and I have set-up an LLC to purchase a business together (w/operating agreement). Our hopes are to also expand this LLC to the purchase of real estate in the future. Will that work or do we need separate LLCs for each acquisition? Also, do I need to file a DBA for each?

   • Hi Lisa, you could go about it either way: one LLC for business + real estate, or separate LLCs. Having said that, it’s more common to set up a separate LLC for real estate. This way, you separate the business liability from the real estate liability (and vice versa). And no, you wouldn’t need a DBA for any of these. We have more info on DBAs here: Do I need a DBA for my LLC.

2. Hi Matt, I live and operate my existing LLC in PA. I’m interested in starting a second LLC in South Carolina to hold my assists, particularly my vehicles because they don’t have a state inspection requirement. The no reports and fees are also a plus. Can I legally do this?

   I also would never use this LLC other then to hold assets to prevent any liability. That being said, if I were to be personally sued or my first LLC is sued (in PA) would this LLC in (SC) be affected in anyway?

   Basically asking since it would be in SC and not PA can a PA Court put a judgement against it? Also if you can answer the same question with both LLC in PA, that would be appreciated. Thanks!

   • Hi Tom, where are the vehicles located? And in what state are they registered?

     • They’re located and registered in PA, was hoping to register them in the SC LLC

       • Thanks Tom. So there’s a few moving pieces here. First, you could deal with some issues when you’re trying to change title and register the vehicles in PA to your South Carolina LLC. Not that you legally can’t. It’s just that the DMV representative you see may not be familiar with out-of-state LLCs and they may ask to see that your South Carolina LLC is registered as a Foreign LLC in PA. So I’d recommend calling or visiting your local DMV office and see if they require any specific paperwork. Again, not that it can’t be done (I’ve registered vehicles in states where I reside with out-of-state LLCs, but it did take some extra effort on my part… the DMV office was quite confused).

         Let’s say all goes well and you title and register your vehicles in the name of your SC LLC. You asked if your PA LLC were sued, would that affect your SC LLC. The answer is no. Those are different entities.

         However, if you were personally sued, in a worse-case scenario, any LLC that you own could be “attacked”. Meaning (and this is over simplified), you’d first have to be personally sued for a large issue, not be able to settle, go to court, lose in court, not have insurance, and not have money to pay if a judgment were issued. Only then would the judgment creditor make an argument to look at your other assets for foreclosure/collection. And that could include LLC Membership Interest you own… aka, your ownership in your LLCs (in both states). And this could come into affect if the vehicles were instead owned by a PA LLC. There’s a few ways to strengthen this. First, I recommend speaking with an asset protection attorney in PA. However, you could consider having a bonafide 2nd Member in your LLC. And you can also get personal umbrella insurance. You can get a policy for a few million dollars. And the easiest place to start is contacting your car insurance company.

         Having said all that, if you’re just looking to save money, forming a South Carolina LLC for PA vehicles could be a lot of work and a headache. You’ll also need a South Carolina Registered Agent.

         Beginning in 2025, Pennsylvania will require all LLCs to file a Pennsylvania LLC Annual Report. Even so, it might make your life easier to just use PA LLCs with adequate insurance. And if you want to get more fancy, you could speak with an asset protection attorney to do some other types of entity structuring. Hope that helps.

3. Matt, thank you for all the useful information. I live in North Carolina, but own property in South Carolina resort area that is a short term vacation rental condo. I would like to put this property into a LLC for liability reasons as sole propriotorship. Should the LLC be in SC where the property is located instead of where I live? There is no mortgage, so to transfer the property title to the LLC would just require a quit claim deed? Would the LLC have to file a tax return in SC? And last, if the LLC holds the title, how does this affect my personal Will? Could I address this with a codicil to my personal Will to leave the property owned by the LLC to my heirs?

   • Hi Deb, you’ll need to speak with an accountant about how taxes are filed. We can’t comment on that. We also recommend speaking with an estate planning attorney. Typically, LLC membership needs to go through probate.

     If you have numerous properties, here’s something to look into (this is over simplified): Create a Living Revocable Trust in North Carolina. The Trust (technically the Trustee) is a Member of a “Parent company” LLC in North Carolina. The North Carolina LLC owns a South Carolina LLC (or various LLCs). You list your beneficiaries in the Trust. This has a number of benefits, one being that when you pass away, there is nothing to probate and the property(ies) don’t need to be re-titled. You could also build onto your estate planning and have your Trust own other assets. And your will could become a “pour-over” will, meaning, the beneficiary of the will is your Trust (to avoid probabte). A lot to digest, but I hope that helps.

4. Q. My mother passed away 9 years ago. She left 3 acres of land to four children. We (1 of 4) would like to divide the land. There is no will. Is it possible to set up a LLC for the land?

   • Hi Al, yes, most likely, however, you’ll want to work with an estate attorney as it sounds like the estate still needs to be probated.

5. Matt, thank you for taking time to list out detailed steps for setting up your LLC. I was a bit nervous on how to do this process, but after reading thru your step by step guide I became and expert lol Thank you for your help.

   • Hi Dean, that’s so awesome to hear! You are very welcome :)

6. Matt, thank you for taking time to list out extremely detailed steps for setting up your LLC. i was a bit anxious on how to do this process, what if i make a mistake that might come back to bite me later, etc. But your website with very detailed steps and state by state call out is super useful and amazing!
   Thank you for this service!
   Regards, GR

   • Hi GR, you are very welcome! We’re so happy to hear our site could help :) Again, you’re very welcome and best wishes with your business!

7. I am looking set up an LLC in South Carolina and I plan to use a registered agent.

   When filling out the articles of organization I see there is a place to list :
   1.The initial designated office
   2. The initial agent for service process and the address for the initial agent
   3. The name and address of each organizer.

   I understand that the initial agent for service would be the third party registered agent, and the organizer is whom ever fills out the forms.

   My question is regarding the initial designated office.
   First can I use a PO box for this?
   Second can I use my registered agent’s address for this?
   Lastly, is all of this information publicly available and result in me receiving junk mail / solicitation if I list my home address as the initial designated office.

   Thank you,
   Mark

   • Hey Mark, great questions. First, the entire Articles of Organization, and all information on it, is public record. So yea, junk mail and solicitations. That’s the unfortunate part. A lot of companies buy records from the state (or just scrape the database). Some third party Registered Agents will allow the use of their address in the “address of the initial designated office” section (as well as other sections of the Articles of Organization), others don’t. We specifically discuss this here: South Carolina LLC Registered Agent. The designated office address cannot be a PO box address. Hope that helps.

8. Thank you for the information! I’ve been looking for a step by step guide like this online for my state. I will be setting up my LLC right now. Thanks!

   • You’re very welcome Terry! Hope you enjoy going through our free LLC course :)

9. Matt good morning I’m looking to add a member and manager to my LLC I was wondering how I would do these things?

   • Hi Matthew, we recommend working with a business lawyer on this to properly document things. Here’s the overview though:

     1.) Review your Operating Agreement to see if there are already terms as to how an LLC Member is added. Also review state statute.
     2.) Create a Resolution of LLC Members (just you) agreeing to add the new Member and agreeing to file an Amended Articles of Organization (§33-44-204) with the South Carolina Secretary of State.
     3.) Either amend your existing LLC Operating Agreement or create a new one. This will show the LLC Member being added, their contribution to becoming an LLC Member, how much of the LLC they own, and any other terms of your arrangement.
     4.) File the Amended Articles of Organization with the Secretary of State.
     5.) File Form 8832 with the IRS changing your LLC’s tax classification from Sole Proprietorship to Partnership.
     6.) Work with an accountant to make sure your taxes are filed properly when April 15th 2019 rolls around. Part of the year your LLC was taxed as a Sole Proprietorship and the other part it was taxed as a Partnership.

     Having said all that, you may also want to consider just forming a new LLC with your new partner. It’s a lot easier than the above and the documentation is simpler.

     Hope that helps!

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