Many South Carolina entrepreneurs choose to form a limited liability company (LLC) because of the many benefits of this business entity type. An LLC provides liability protection, for instance, so your assets are not at risk if your business is sued or cannot pay debts.
An LLC is a “pass-through entity” for tax purposes, meaning that the LLC itself is not taxed. Instead, income passes through the business to the LLC owners or members, who report it on their tax returns. LLCs also offer flexibility in terms of management and taxation.
Creating an LLC is relatively straightforward, but ensuring it’s done correctly is crucial to getting your South Carolina business on the right foot. The most critical step is filing articles of organization.
What Are Articles of Organization for an LLC?
The articles of organization is a legal document filed with the Secretary of State to form an LLC officially. It will include your business name, address, registered agent information, and more, as detailed below.
First, Select a Registered Agent for Your South Carolina LLC
South Carolina requires LLCs to appoint a registered agent, a person or company authorized to accept and respond to official business correspondence, such as legal, tax, or financial documents.
The registered agent ensures all required notices and documents are received. In South Carolina, the registered agent can be an LLC member, individual, or entity that meets state requirements. In South Carolina, a registered agent must:
- Be 18 years or older
- Have a physical address in the state
- Be available during regular business hours
- Be registered to operate in the state, if it’s a business
Many business owners hire a registered agent service to ensure their LLC stays fully compliant and for convenience.
If you choose to be your registered agent, you must be at your registered agent’s address for all business hours. A registered agent service allows you to be wherever you need to be to run and grow your business.
How to Submit Articles of Organization in South Carolina
To start, visit the Secretary of State’s website and access the articles of organization online. Then, click on the Start a New Business Filing button to be taken to a business name lookup tool. You will need to confirm your desired business name is available before proceeding.
Next, you’ll need to create an online account with the Secretary of State. Click the Register link at the top and follow the instructions.
In South Carolina, the articles of organization require the following information:
- LLC name
- Principal office address
- Registered agent information
- Registered office address
- Organizer information
Once your account is created, log in and choose limited liability company from the drop-down menu. Then click the Start Filing button.
You will then be taken through a series of steps where you can enter all of the necessary business information outlined in the bulleted list above. At the end of the process, you’ll have the chance to review your entries and make changes before proceeding to the payment screen.
You can also complete and submit a paper form if you wish to file by mail. The filing fee is $110. You should receive confirmation in one to two business days if you file online. The turnaround time is 14 days.
Some entrepreneurs hire an LLC formation service like ZenBusiness to handle this step, saving time and ensuring the process is done correctly.
Draft an Operating Agreement
South Carolina does not require an operating agreement, but it’s a crucial document that defines members’ ownership percentages and profit allocations. Those are the two key elements, but it should also include the following:
- Each member’s rights and responsibilities
- Management structure and roles
- Voting rights of each member
- Rules for meetings and voting
- What happens when a member sells their interest, becomes disabled, or dies
You can find operating agreement templates online, but it’s best to have them drawn up or reviewed by an attorney. The language of an operating agreement is crucial and can often help determine how member disputes will be resolved. Here you can obtain a free operating agreement template for your South Carolina LLC.
Contact Information for the South Carolina Secretary of State
South Carolina Secretary of State Website
Phone: (803) 734-2170
SC Secretary of State’s Office
1205 Pendleton Street, Suite 525
Columbia, SC 29201
There’s only one way to create an LLC in South Carolina: successfully filing articles of organization. If you make any mistakes, you’ll likely have to refile, so be sure to do it right the first time and set your business up for serious success!