How to Create an LLC in Vermont

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How to Form an LLC in Vermont:
5 Simple Steps to Get Started
According to the IRS, each state may use different regulations around forming an LLC, and you should check with your state if you’re interested in starting a Limited Liability Company. To simplify the process of forming an LLC in the state of Vermont, we’ve put together a step-by-step guide to detail each step of the process and answer any questions you may have.

Step 1
Name Your Vermont LLC

Your first consideration when choosing a name for your LLC is that it be unique from any other business in the state of Vermont. You can quickly and easily do a name check on the Vermont Secretary of State website business name database to verify the business name you want is available. For a $20 fee, you can reserve a name for 120 days by filing an Application to Reserve a Specified Business Name online or by mail.

In order to comply with Vermont state law, your company’s name must end with some form of the term “Limited Liability Company.” This can appear as the whole phrase written out or one of the following formats: “Limited Company,” “L.L.C.,” “LLC,” “LC,” or “L.C.” You can also choose to use abbreviations for the words “Limited” and “Company” as “Ltd.” or “Co.” respectively.

Step 2
Appoint a Registered Agent in Vermont

The state of Vermont requires that any LLC have a registered agent for service of process. This means your LLC must have an entity that agrees to physically accept any legal papers on the company’s behalf should it be sued. This entity does not have to be an individual person. The registered agent can be any resident of the state of Vermont or a business entity authorized to do business in Vermont so long as the agent has a physical street address within the state.

Step 3
File Vermont Articles of Organization
To officially create your LLC in the state of Vermont, you’ll need to complete the Articles of Organization paperwork and file it with the Vermont Secretary of State. For a $125 fee, this can be done either online or by mail. To complete this form you will need to know the following:
  1. The name, address, purpose, and fiscal year of your LLC
  2. The name, address, and signature of the company’s registered agent
  3. Whether the LLC will be member-managed or manager-managed
  4. The name(s) and address(es) of any managers associated with your LLC
  5. Organizers’ addresses and statement of whether they will be liable for debts

Step 4
Create an Operating Agreement

You may want to consider preparing an operating agreement to outline the ownership and operating procedures for your LLC.

Though not required by the state, an operating agreement will set the guidelines for running your company. This does not need to be filed with the state, but it can go a long way toward ensuring your company’s success.

Step 5
Apply for an Employer ID Number (EIN)

An IRS Employer Identification Number (EIN) is required of your LLC unless it is a single-member LLC with no employees. Obtaining an EIN is as easy as completing the application on the IRS website.

It’s possible your company will need to register with the Vermont Department of Taxes. Whether or not your company needs to follow this step will depend on the exact types of taxes it will be collecting and/or has been collecting from the state as well as whether you have employees. Visiting the VTBizFile website is the best way to get started.

If your LLC will be selling a physical product, you’ll need to register for a sellers permit through the Vermont Department of Taxes website. This will allow you to collect sales tax on taxable sales. Additionally, if you have employees, you’ll need to register for Unemployment Insurance Tax through the Vermont Department of Labor and also register for Employee Withholding Tax through the Vermont Department of Taxes.

Other Considerations
Foreign LLCs and Business Licenses
Foreign LLCs

If your company is a foreign LLC, also referred to as an out-of-state LLC, wanting to do business in the state of Vermont, you’ll need to follow all the steps outlined above with a few minor differences.

You will need to file an Application for Certificate of Authority with the Vermont Secretary of State as well as a Certificate of Good Standing (or the equivalent) from your LLC’s domestic or home state. The Certificate of Good Standing must date back no more than 30 days prior to filing.

The filing fee is the same: $125.

Business Licenses

Some industries will require you to secure federal, state, and/or local licenses to legally operate in the state of Vermont.

Although there isn’t one central location where you can check to see if your business has everything it needs to be compliant, Vermont’s page on licenses and permits can help you find the state-level licensing you need while this page from the U.S. Small Business Administration can aid your search on the federal level.

Do some careful research to find out what licenses and permits you need or hire a professional service to do it for you.

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