Start a South Carolina LLC

1. Name your South Carolina LLC

Naming your LLC in SC is an integral part of establishing your business. You want to make sure the name represents the purpose and character of your business, but there are some rules that must be followed. 

LLC South Carolina naming requirements

Under state law, the name of your LLC in South Carolina must contain the words “limited company” or “limited liability company.” Abbreviations for these terms are also acceptable. The name you choose also needs to be distinguishable from other South Carolina businesses. We have additional resources if you’d like more details on how to name your LLC. 

Checking and reserving your business name 

You can use our Business Name Checker tool to determine if your business name is available. Once you’ve chosen a name, you should consider reserving it so no one else can swoop in and take it before you officially register the name. A South Carolina LLC name can be reserved for 120 days. 

Register a domain name

In this day and age, having an online presence is crucial. Regardless of whether you have a brick-and-mortar business, provide a service, or focus on e-commerce, people are going to search for you online. Register a domain name that you can use to establish your website, email address, and web hosting. If you don’t register your domain name, someone else can take it and charge you a higher fee to have it.

Is your South Carolina LLC name available as a web domain?

A website helps build credibility in your industry and legitimize your business, no matter the size. One reason why your South Carolina LLC needs a website in 2022 is to reach your target consumers. 

According to Google Search Statistics, more than 2.4 million searches happen through the search engine every minute. Someone could be searching for your specific service right now. 81% of retail shoppers conduct online research before buying almost any product or service. More than 50% of smartphone users discover a new company or product while browsing online. 

The URL you choose for your website can make a big difference in whether or not potential customers can find you online. Use our domain name search tool to see if your desired business name is available as a URL. If you find a domain name you like, you might want to acquire it before someone else does. 

Your business name and the domain name can be the same, or they can be different as long as the domain name makes sense. It may also be worth checking if related social media handles are available. Social media platforms are a way for businesses to stay engaged with current customers and acquire new ones. 

We can help you find and purchase your domain name through our Domain Name Service.

Apply for a DBA

DBA stands for “doing business as.” If you’d like your LLC in South Carolina to go by a name other than your official registered name, you’ll need to register a DBA in the county where your business operates. This process doesn’t involve the Secretary of State. Each county has its own process, which generally starts at the County Clerk’s office. 

2. Appoint a registered agent in South Carolina

Every formal business entity in South Carolina is required to appoint a registered agent. In South Carolina, this is also sometimes referred to as an Agent for Service of Process. 

What is a Registered Agent?

This individual or business is tasked with receiving important business and legal correspondence for your company. They’re essentially your point of contact with the State of South Carolina. You need to have a registered agent chosen when you register your South Carolina LLC. Their information and signature are required on the formation documents. Your registered agent must be available during all normal business hours. 

What if the state can’t find my South Carolina registered agent?

If you’re acting as your own registered agent or have appointed an individual to be your South Carolina LLC registered agent, availability is important. If your registered agent isn’t where they are supposed to be during regular business hours, there could be negative consequences for you and your company. 

Taking vacations or sick days is ok for most people, but a registered agent has to be where they say they’re going to be. Unsuccessful delivery of important correspondence can result in a court ordering “substitute service,” which allows the documents to be served to the Secretary of State or published. In the case of notice of litigation, if you aren’t directly served, your LLC may fail to respond in time, which can result in a default judgment against you. 

In limited circumstances, when there isn’t a current registered agent and registered information on file for an entity, the secretary of the business may serve as the agent for service of process.

Who can be a registered agent?

A registered agent must reside in the State of South Carolina. If using a registered agent service, they must be authorized to transact business in South Carolina. You may choose an individual within the company to serve as the registered agent, or you can do it yourself. However, difficulties could arise if you take a vacation or even take a long lunch break and miss the service of important papers. Therefore, most companies use a separate agent.

ZenBusiness can be your registered agent

Our registered agent service goes above and beyond just receiving documents. We also store all correspondence in an online dashboard that you can access at any time. It’s very easy for paperwork to get lost in the shuffle — which is why we’re highly committed to helping you stay organized. 

When you choose us to serve as your registered agent, we’ll always be there to receive important notices on your behalf. This will help keep your South Carolina LLC complaint and help you avoid the embarrassment of being served legal documents in front of customers or clients.

3. File South Carolina Articles of Organization

The official formation of your South Carolina LLC occurs when you file your Articles of Organization with the Secretary of State. Without this document, your limited liability company doesn’t exist. Jumping through the hoops of gathering information for your Articles of Organization and ensuring proper filing can be time-consuming and intimidating. We can help with our LLC South Carolina Formation Services. 

E-Filing South Carolina Articles of Organization

Although you can submit Articles of Organization by mail, electronic filing is much more convenient and efficient. Filing can be done on the Secretary of State’s website once you create an account. The cost to file this document is $110, but there may be other additional costs.  

South Carolina doesn’t offer expedited filings. Filing online takes one to two business days for processing, while filing by mail takes four weeks. 

Information needed for your Articles of Organization

A little planning can go a long way. Make sure that you have all the necessary information prepared before filling out your South Carolina Articles of Organization. You’ll need to have the following information to start an LLC in SC:

• The official name of your South Carolina LLC
• The designated address of the business
• The name, address, and signature of the LLC’s registered agent
• The name and address of at least one organizer
• The term date, if the LLC is only going to exist for a certain period of time
• The names and addresses of initial managers (if applicable) 
• Whether the effective date will have a delay
• Any additional provisions deemed necessary
• The signature of each organizer

Consider whether you want your South Carolina LLC to be managed by members or managers. This will change the information you provide in your Articles of Organization. 

Member-Managed or Manager-Managed?

Before submitting your South Carolina LLC Articles of Organization, you’ll need to choose how your business will be managed. Your options are member-managed or manager-managed. There are a number of factors that may influence your decision, including the number of members in the limited liability company. 

A member-managed LLC operates similarly to a partnership where the members, who are also referred to as “owners,” have the ability to bind the LLC. This is usually best if there are few or only one member. 

An LLC that’s manager-managed operates more similarly to a corporation where the corporate officers (managers in this case) have the ability to bind the company. This manager can be a member or can be hired from outside the company. This option is usually best when there are a lot of members or investors who prefer not to be responsible for the day-to-day operations of the business.

Amending Articles of Organization

Though your Articles of Organization must be correct at the time it’s filed, that doesn’t mean the information can’t change. If you decide to switch your registered agent, contact information, or management type, you can do so using Articles of Amendment. 

We can make this process easy with our amendment filing services. It’s important to make sure you update your information with the Secretary of State. We can also help keep you compliant with our Worry-Free Compliance Service, which includes two amendments annually. 

Why would I delay my South Carolina LLC filing date?

Your LLC effective date is the date your company begins to legally exist. 

As the owner of a South Carolina LLC, you have to pay taxes for the calendar year in which you register the business. If you’re close to the end of the year, it may make more sense just to wait until January to officially form your business. That doesn’t mean you can’t knock submission of your Articles of Organization off your list of things to do. 

The South Carolina Secretary of State typically makes your limited liability company effective when you submit your paperwork. However, the SC Articles of Organization have a section for you to choose if you’d like a different effective date from the date you’re actually filing the document. You can delay your effective date for up to 90 days. Back-dating isn’t allowed.

4. Create a South Carolina operating agreement

An operating agreement isn’t necessary to function as a valid LLC in South Carolina, but it’s a good idea to have one. 

What is an operating agreement?

An operating agreement is an important document used to govern how a limited liability company operates. It details the management structure of the LLC, including how it’s organized, membership rights, roles and responsibilities of management, conflict resolution, profit and loss distributions, and dissolution of the business. 

Why are operating agreements important?

Operating agreements ensure that all members have the same expectations for how the business will run. Having an official document that everyone can reference reduces the risk of conflict among members. 

Do I need an operating agreement even if I am the only owner?

The purpose of your operating agreement is to lay out how the LLC will run and detail the responsibilities of members and managers. Although some people think that a single-member LLC doesn’t need an operating agreement, this isn’t necessarily true. Despite the fact that, as a sole owner, you don’t have to worry about conflict between members, the operating agreement still has a lot of value. 

Here are some reasons that it’s a good idea to have an operating agreement even if you’re the sole owner of the limited liability company: 

• If you’re trying to acquire funding, you can show the operating agreement to potential lenders to give them an overview of the company structure. 
• If you can’t manage your business because of illness or some other reason, whoever steps in will have guidelines to follow. 
• You can create your own rules for running your business that supersede state business statutes. 
• In some cases, potential investors, business partners, and financial institutions may require an operating agreement.

If you don’t have an operating agreement, your business will be subject to default state rules that may or may not be beneficial for your LLC.

How to form an operating agreement

An operating agreement should take into consideration all aspects of the business. If you’re unsure as to how to create an operating agreement for your South Carolina limited liability company, we offer a customizable template to help get you started. 

5. Apply for an EIN

EIN stands for Employer Identification Number. This nine-digit number is assigned by the Internal Revenue Service (IRS) and identifies your LLC for tax purposes. 

Why does an LLC need an EIN?

An EIN is like a social security number for a business. It’s necessary to open business accounts, hire employees, and file and manage both federal and state taxes. 

Can filing as an S Corp lower my taxes?

One of the benefits of having a South Carolina LLC is the flexibility when it comes to choosing how your business is taxed. An LLC can opt to be taxed as a sole proprietorship, an S Corporation, or a C Corporation. 

Choosing an S Corporation allows for “pass-through” taxation. An S Corporation doesn’t pay taxes as a business. Taxes are paid on the owners’ personal income taxes. Being taxed directly at the personal income level is called “pass-through taxation,” and is one of the primary benefits of an S Corp. An S Corporation may still owe tax on certain income depending on the type of business.

C Corporations are taxed at both the corporate level and individual tax level. C Corporations pay tax on their income as a business. Taxes are also paid by owners and employees on whatever income is received from the business. This is considered “double-taxation.” 

Filing as an S Corp could also save you money on self-employment taxes by allowing you to be an “employee-owner” and splitting your income into your salary and your share of the company’s profits. In doing this, you pay self-employment taxes on your salary, but not your profits.

The drawback to having an S Corp is that the Internal Revenue Service scrutinizes them very closely. You may be more likely to get audited.

How to obtain an EIN

Your South Carolina LLC EIN is free from the IRS, but you do have to go through the application process either online or by mail. You’re going to have a lot to do when starting a business. We can obtain your EIN for you with our EIN Service.