How To Set Up A Single-Member LLC
Cassie Brown • April 20, 2020
There are four options when you are setting up an LLC: single-member LLC, multiple-member LLC as a partnership, LLC as a C corporation, or LLC as an S corporation. This information is specific to how I set up my LLC, Cassie Brown HR Consulting, LLC, and the lessons I learned along the way, sometimes by happenstance.
Do your homework! Consult with a tax advisor before you determine which option is best for you. I consulted with the tax advisor AFTER I set up my single-member LLC and I may have done things differently if I had done the tax research first. If you need a recommendation, let me know, I am NOT a tax advisor, I know just enough to ask the right questions, most of the time. Here is a little advice, though: track everything you spend any money on, including all the miles you drive as you set up your LLC – trips to the bank, post office, printing/production stores, office supply stores, startup costs, etc. It’s better to track everything and remove anything you later determine is not deductible, when working with your tax advisor.
Make sure your company name and associated website/email address are available. www.godaddy.com
is a great resource to search options for the website name and associated email extension you want, and you can purchase them online, it was $64 to buy my site name and $78 for the associated email account. You can check with the United States Patent and Trademark Office (USPTO) to ensure your business name is available, https://www.uspto.gov/trademarks-getting-started/trademark-basics
and you should do this before deciding your web address/email, etc.
Get a masked phone number. I got this from www.godaddy.com
with my website domain and email address. It’s an app you can download and use for your business phone and texting. I didn’t want my cell phone number out everywhere and on my website, so this was a great option. It still rings through to your cell phone on the app and it’s really easy to use. You can also set do not disturb hours so that you phone doesn’t ring at crazy times in the middle of the night, especially if you have this contact number on your website. You can also set it to deliver you an email if someone leaves you a message, so you don’t miss any calls. This was $55 for the year.
Get a PO Box. Especially if you will be operating your single-member LLC out of your home, like most people. If you don’t have a PO Box, your personal home address will be public information on all the business documents you fill out. This cost me $130 for the year, the smallest box available at my local post office. Note that you will need two forms of ID when you take your paperwork to the post office (you can prepay for the box online). I was able to use my driver’s license and my car insurance card. There are only a handful of documents you can use, so research that before you head to the post office (and don’t forget to track those miles).
Obtain your single-member LLC Employer Identification Number (EIN) from irs.gov.
You will need this when you file your Articles of Organization with your state and for many other things, bank account included.
Set up a business bank account. You will want to run EVERYTHING out of your business account and take advantage of all deductions (remember, before you start, consult your tax advisor).
Registered Agent/Service Processing. You will need to sign up for services with a registered agent/service processor. There are a lot of options to choose from if you search online. A registered agent will be where any legal documents are ‘served’ to your company, if ever needed, and they have to be in the same state as your company. They will also receive notifications for your business from the Secretary of State or taxing authorities. This is a requirement for an LLC. You can be your own registered agent, however, that means you have to be available to be served during normal business hours, and, if you are operating as a single-member LLC, most likely out of your home, you will not be home ALL the time during normal business hours. I found one for $49 a year. You will need this before you file for your Articles of Organization.
File with your Department of State to obtain your Articles of Organization, that cost me $300 in Tennessee. I was able to complete this task all online and received the forms electronically once they were complete. I received two separate documents (3 pages in total), a Filing Acknowledgement (1 page) and an Articles of Organization Limited Liability Company (2 pages). Keep these in a safe place – I keep mine electronically, with a back-up system, and in the safe.
File your Articles of Organization with the Register of Deeds in your county. This cost me $7.
Business License. Not all cities/counties will require that you have a business license. Call your city or county office (depending on where you live) or visit their website to find out if you need to get a license. Where I live, I am required to get a business license for $15 a year.
Make your logo, you will use this on your website, business cards, PowerPoint templates, social media sites, etc. and file to protect it with the USPTO
along with your company name. You can create your logo on your own and pay a small fee for something that is any good, or you can pay someone to create it for you. That will range anywhere from $50 and up, depending on what you are looking for and how much help you need.
Patent your logo and company name. The USPTO site recommends that you use a patent lawyer, I’ll leave that up to you to decide. I did not use one and figured it out. If you want to trademark your logo/company name, that will cost at least $275 for the filing fee with the USPTO, much higher if you use an attorney.
Build your website, there are several DIY options and getting help might cost up to $3,000, depending on how much help you need or what you want on your site. I used zeroie.com
to build my site. Once owner, Mason Adams, got me started with my basic platform I was able to quickly understand how to navigate making updates and changes and we created something that I really like for my business.
Create your Google My Business
page. It only takes a few minutes to get started and helps when people are searching for your business. Mine doesn’t have a ‘store front’ so to speak, I imagine most single-member LLC’s will not, which is OK, you can still set up a page to help people find you online. Note: they will send you a postcard, that’s right, snail mail, with a code to finalize setting up your account. I assume they do this to ensure it is a real address and people aren’t making up fake accounts/businesses/etc. My postcard took about 4-5 days to arrive in my mailbox.
Create your LinkedIn Business
page, for free! This is also quick and easy. Important to have your logo ready in a 300x300 jpg/PNG so that it will load on LinkedIn. That seemed to be the hardest part for me, fitting it on the page, just how I wanted. Once ready, just invite your network to follow your new page and update your personal LinkedIn account to say that you work at your company, adding links between the two. Then, figure out what works best for you posting from your business page, there is a lot of information online about how to maximize your LinkedIn business page.
Set up QuickBooks. I needed a place to track my expenses, create invoices and account for income from clients. I picked the basic version, because it’s just me and my business is NOT complicated, $12 for the year. It links directly to your business account, helps you pick how to track your expenses and has an invoice platform that is easy to use. Even an option to take credit card payments for your business (for a fee), I didn’t opt to do this right now. I also downloaded the app, which allows you to track all of your business miles, keep track of business receipts and it’s really easy to use.
Reach out to your local Chamber. The basic membership at my local Chamber gives me a lot of access to people throughout the community and one free session with a lawyer and an HR person, which I won’t need, so I also volunteered to offer HR sessions to assist the current person who does that in my city. Cost for membership is $385, there were various options, but I choose the basic since I am small and just starting my business.
And, in my networking discussions with other start up businesses who also do consulting, it is recommended that you have errors and omissions insurance coverage, based on the work I am doing. You may need some type of additional insurance for your business as well, depending on your services.
Summary of all costs (may vary by state/area/service):
• Go Daddy site, $63.24
• Go Daddy email and phone masking, $128.37
• Registered Agent/Service Processor, $49
• PO Box, $130
• Website building, $3,000
• Business license, $15
• Articles of Organization, $300
• Register of Deeds filing, $7
• QuickBooks, $12
• Chamber membership, $385
• Trademark filing fee, $275 (will be higher if you decide to use an attorney)
Total cost: $1,000-$4,000 to get started. Being your own boss and working on what matters most to your clients…invaluable! Good luck to you if you are venturing out on your own, and let me know if I can help in any way! www.cassiebrownhrconsulting.com
Thankful. In this year filled with so many unknowns and changes to the way we have to “be” with one another, it is perplexing to some to think about the things we are thankful for this year. I, however, didn’t seem to have any issue coming up with things I am thankful for in 2020. For the first time since my children were very young, (a time in our lives when everything was chaos most of the time with school, homework, after school activities, etc.), we sat around a table with each other and enjoyed dinner and “adult” conversation. My two college-aged sons came home for Spring Break in March and didn’t leave, moving to 100% remote learning and 100% in our refrigerator and pantry. We played games, had movie nights, worked on puzzles, told stories, found old home movies from when they were babies, and gained new appreciation for each other. I am thankful for this time with them. My husband and I both expanded our businesses, and while I became an expert on all things COVID, he became PMP certified. I worked on expanding my network, continuous learning, learning new industries, and mentoring others in the HR community. I am thankful that we are both working, supporting each other and supporting local businesses. We had powerful conversations with each other, with family and friends, with those who think like us and those who do not, with people we love, as our world stood divided over politics and racism. I am thankful for those who engage in respectful dialogue on these topics, who seek to understand, learn and share. We miss our friends and family we don’t get to see, and the “normal” we had been accustomed to all these years. I am thankful for the work we do to keep all of us safe, knowing that we will see one another soon, that this too shall pass. We are flexible and resilient, hopeful and compassionate, and most of all, thankful for the ability to choose how we show up every day. This week I choose to be thankful.
Don't tell me what you think/believe, show me.
As employers consider if they will need to furlough employees, lay them off, or are contemplating a reduction in force, here are some things to consider for planning purposes.