4 Best Florida LLC Services

Florida LLC Fast Facts

• LLC Formation Speed: Real-time updates on this page (currently about 1-2 business days for online filings and 2 weeks for paper filings)
• Cost to File an FL LLC: $125, plus the service’s fee if you use one
• How to File Your Articles of Organization: Online or by mail
• Annual Reports: Due each year by May 1; costs $138.75 to file
• State General Business License: Not required. However, many counties require licenses and industry licenses may also apply
• PLLCs: Permitted in the state; a PLLC uses the same form as a standard LLC

What Is a Florida LLC?

LLCs are formal legal entities that are typically taxed similarly to sole proprietorships and general partnerships, in that the owners include any company profits or losses into their personal returns — the LLC itself does not owe income taxes. An LLC may also elect to be taxed like a corporation, although this is not a very common option.

There are similarities to corporations too, especially when it comes to financial responsibilities. In an LLC, the owners or members are not usually personally accountable for the financial status of the business. This means that if someone sues your LLC, your personal assets are not at risk.

While Florida does not legally require LLCs to create an operating agreement, it’s still strongly recommended. This document can help clear up any disagreements between your owners, and it’s also just generally convenient to have a roadmap of your LLC’s operational aspects.

Florida’s formation fees for an LLC are basically in the middle of the road compared to other states. This state charges $125 to form your LLC, which is neither a terribly expensive nor a tremendously affordable price point. Similarly, Florida charges $138.75 for annual reports, which is also nowhere near the highest or lowest prices on a state-by-state basis for this filing.

One area where Florida can help LLC owners save money is taxes because this state does not charge personal income tax. This means that if you use the standard pass-through form of LLC taxation in this state, you can save a significant amount of money compared to operating a corporation, which is subject to Florida’s 5.5% state corporate income rate.

The Total Cost of Forming and Maintaining an LLC in Florida

In addition to the costs of a business formation service or hiring an attorney (which are optional, as we’ve discussed), there are quite a few other required and optional expenses when forming and maintaining a Florida business. You cannot form an LLC in Florida without filing the Articles of Organization, as this document is the one that officially registers your business within the state. Florida requires a $125 fee for this registration.

In Florida, most businesses will need to obtain a general business license, but these licenses are administered at the county level. Plus, each county gets to set its own filing fees for this document, so you should check with your local county tax collector to learn the requirements for your area.

Your LLC will need to file an Annual Report every year. This simple filing keeps the state informed about some basic but vital business information, like your address and registered agent. The base fee is just $138.75, but if you file it late, Florida charges a hefty late fee of $400.

Florida is unique in that it does not charge a personal income tax, so LLCs taxed as pass-through entities will not pay income taxes. The corporate income tax rate is pretty average: 5.5%. But no matter which entity type you form, on the national level, you’ll have to pay federal taxes, along with several others.

For instance, if you have employees, you’ll pay unemployment insurance tax. If you sell goods or services, you’ll pay sales and use tax. Depending on the nature of your business, there could be other taxes required, so check with the Florida Department of Revenue to make sure.

Other than that, the other potential expenses only apply to certain businesses. These include things like professional or industry-specific business licenses and business insurance.

Should You Form a Florida LLC or Corporation?

Common characteristics

There are some common aspects of the LLC and the corporation, starting with the personal asset protection they both provide. Also known as limited liability, this personal asset protection ensures that if your business is sued, only the business assets are at risk. Meanwhile, your personal assets — like your house, car, personal bank accounts, investments, etc. — are protected by your LLC or corporation’s business structure.

In addition, LLCs and corporations both provide their owners with business name exclusivity. If you own and operate a sole proprietorship or general partnership, you will not have exclusive rights to your business name. Instead, if another company decides to use your name as its own, you won’t be able to stop them. In fact, they could even register your business name and gain exclusive rights to it, forcing you to come up with a new one.

Advantages of the LLC

In general, an LLC is quicker and easier to form than a corporation. LLCs usually need to provide less information for their formation documents than corporations do, and there are fewer steps in the process as well. For instance, LLCs don’t need to draft corporate bylaws, name officers or board members, hold initial board meetings, or issue stock. On the other hand, corporations need to do all of these things and more.

The LLC is also a less rigid business structure that allows its owners greater flexibility. The business structure of a corporation is inflexible, with many regulations dictating how the business should look and function. Meanwhile, LLCs have options for business management structure and ownership responsibilities that corporations simply don’t have.

Another even more valuable option LLCs have is that they can choose how they want to be taxed. Most LLCs are taxed as pass-through entities, which means the business itself does not pay taxes, but the profits are passed through the LLC itself to its owners, who pay taxes on this money on their personal returns. However, LLCs can also opt to be taxed like corporations (either as a C corporation or an S corporation), giving them more options for taxation than a corporation has.

Advantages of the corporation

Corporations have some advantages too, like the ability to sell stock. It’s quite difficult for an LLC to attract outside investments because it cannot issue stock. The vast majority of investors prefer stock as their investment medium, and it’s also very rare to see venture capitalists investing in LLCs. For these reasons, the corporation is a much better option for businesses looking to attract investments.

In addition, the corporation has been around for hundreds of years, while the LLC is a newer addition to the American business landscape. This means that the corporation has more established legalities and also that it’s easier to expand into other states because the corporation’s structure is essentially the same no matter where you form it.

How to Set Up a Florida LLC on Your Own

Technically speaking, you don’t have to use an LLC formation service like ZenBusiness or LegalZoom. These services are incredibly helpful, but you can save money by completing the process yourself.

You can read our complete guide to DIY an LLC setup in Florida, but here’s a quick look at the process:

Choose a business name

Every LLC in Florida needs a name that’s memorable and gives potential clients a good idea of what goods or services are available. The name also needs to be unique — both for legal reasons and so your business stands out from the competition.

Appoint an FL registered agent

As we’ve mentioned in this guide, every LLC needs an agent who can accept service of process on your behalf. In all states, you can act as your own registered agent as long as you have a physical address in the state. That said, we generally recommend that you appoint someone else (like an online service) to act as your agent.

File the Articles of Organization

This document, once filled out and filed, officially forms your business in the state of Florida. You’ll need to provide some important information, including your contact information, your business address, signatures for your LLC’s members, and more. Florida has a $125 filing fee.

Setting up the LLC is as easy as 1-2-3; it’s the maintenance requirements that are a bit more complicated:

Register for and pay taxes

If you have employees, you’ll need to get an Employer Identification Number from the IRS. Then there are state-specific taxes, too. Florida does not have an individual income tax, so only LLCs that file as corporations will need to pay income taxes (5.5%). That said, Florida does have sales taxes to account for (6% plus local fees). You can find out more about these and other miscellaneous taxes at the Florida Department of Revenue.

Get licenses and permits

Most Florida businesses will need to obtain a business license, but not on the state level. Instead, these licenses are obtained through the county tax collector. Plenty of businesses will also need to get professional licenses, which can be found at the Division of Library and Information Services.

Create an operating agreement

Even single-member LLCs should create a “master document” that sets out how the business will operate, both now and in the future.

File your annual report

Each year, your LLC will need to file an annual report to update the state about the standing of your business. The report is due by May 1, and when you file, you’ll need to pay the accompanying $138.75 fee.

Obtain business insurance

Every business with employees needs to maintain workers’ compensation insurance and a commercial vehicle policy for company-owned vehicles. You may also want to get a general business liability policy, too.

Get a business bank account

You should sign up for a business bank account so you can write checks and make purchases in the name of the business instead of pulling from your personal accounts (a legal no-no).

This is just the tip of the iceberg, though. For more detailed guidance, we recommend contacting an attorney or checking out the full Florida LLC Formation Guide.