Did you know that the USA is a top-notch offshore jurisdiction if you know where to form a company? Well, not all states offer equally good conditions, but Florida is definitely worth paying attention to. You will have all the benefits that attract people to offshore islands, like asset protection, tax incentives, and high confidentiality – and you will enjoy the high status of a US company! The incorporation procedure does not take much effort on the condition that you rely on a trustworthy registered agent (and you will have to get one to register a Florida company). In this post, we will focus on the basic procedure of LLC registration in Florida.
We would like to invite you to our portal where you will read more details about Limited Liability Company registration in Florida. Explore other destinations that are of interest to you as we write about international business at large, as well as banking, asset protection, investment, and more. You can also book a free session with our expert to discuss your business plans and get professional advice. We do not charge anything for analyzing your situation and choosing a suitable jurisdiction, for example. However, if you want to delegate the hassle of foreign company registration to us, we will do so at a reasonable fee on a turnkey basis. We will provide a reliable registered agent and take care of everything (including translation/legalization of documents, if necessary), and your involvement will be minimal.
LLC Incorporation in Florida: Main Benefits
Let’s take a look at what the sunny state of Florida can give you in terms of business:
- Minimal formalities. A Florida LLC is easy to manage as you will not need to make any corporate decisions or resolutions and officially submit them. However, it is desirable to hold annual general meetings of shareholders and document the most important business decisions you make.
- Pass-through taxation. This is the kind of taxation usually used by LLCs which means that the LLC profits or losses are reported in each member’s personal tax returns, and taxes are paid individually. An LLC with several members will have to submit an information tax return, while a one-member LLC reports profits/losses using Schedule C. The latter may result in double taxation (when the income is taxed at the company and individual level), but you avoid it thanks to pass-through taxation.
- Subsidiaries. An LLC is entitled to open subsidiaries without any restrictions (unlike Florida S corporations).
- Flexibility. You can have any number of members in your LLC, and its management can be organized in any way you think fit. You can also set any rules for profit distribution (while partnerships usually require a 50/50 option).
Looks fine? Please contact us by following the above link if you have any questions.
Florida LLC: Drawbacks
An LLC is not an ideal solution and has its disadvantages – well, pretty much like any legal form in any jurisdiction. What can you do about it? You simply have to take them into account and decide how critical they are for your business. Meanwhile, let’s take a look at Florida LLC’s drawbacks:
- Minimum protection by laws. What we mean here is the absence of a considerable number of precedents in judicial practice to rely on as Florida LLCs were not the subjects of proceedings very often. It means that court decisions are not very predictable.
- Not much flexibility in ownership transfer. A corporation can be transferred more easily than an LLC. The company’s operation agreement must set out whether the transfer of company ownership is allowed and whether the consent of other members is required in this case.
- An LLC is relatively expensive. A Florida partnership will cost you less, let’s admit it.
It’s up to you to weigh all the pros and cons to decide – or contact an expert to get assistance.
LLC Registration in Florida
LLC incorporation in Florida will require you to overcome quite a lot of administrative barriers. We dissuade you from trying to do that on your own as you will not save much money, while the probability of critical mistakes will be very high.
Drafting the Articles of Organization
This is a document that is required to contain the following information:
- Name, residence address, and signature of your registered agent
- Names and signatures of LLC managers
- Date on which you will start operating your LLC
Drafting an Operating Agreement
This document is not formally required by law. However, if you intend to operate your business for some considerable period of time and it will contain more than one member, we strongly recommend drawing up this document.
A Registered Agent
This is actually the person who will make your Florida LLC registration possible! It can be an individual or a legal entity with a permanent address in Florida. The registered agent accepts the documents on behalf of the company and provides all important information to its members.
Employer Identification Number (EIN)
You will have to receive it from the Inland Revenue Service for tax purposes if you have more than two members, you are going to hire staff, or you want your LLC to pay taxes as a corporation rather than a partnership.
If everything goes as planned, you will get your fully operational Florida LLC within 14 working days.
Open a bank account in Florida for your LLC to start business activities abroad while acting on behalf of an American company. We will help you choose a reliable bank that will suit your financial needs.
Reporting and Taxation
If you derive your profits from any source in the US, you automatically become an American taxpayer. However, if 100% of your income is generated abroad, you will not be liable for paying taxes in the USA.
Annual Financial Statements
These are required to be submitted online in the period from January 1 to May 1, and failure to do so will prevent your LLC from having the status of an active company. You will have to pay USD 138.75 for filing and USD 400 if you delay the submission.
Want to read more details about Florida LLC? Please click on the above link! If you are interested in discussing the practical details of company formation, talk to our experts on the portal. Make the first step to your US business today!