An LLC operating agreement will help you establish credibility in Pennsylvania as you carry out day-to-day business operations. It can prevent you from losing money in lawsuits and help protect your assets if economic conditions become unstable. Read on to learn how to form an LLC in Pennsylvania and download an LLC operating agreement template.
Is an LLC Operating Agreement Required in Pennsylvania?
The Pennsylvania Department of State does not require businesses to have an LLC operating agreement. The state also doesn’t require attorneys to prepare a Certificate of Organization.
Although you don’t need an LLC operating agreement it is highly recommended you have one. An operating agreement outlines management methods, company goals, and profit distribution. It can help protect owners in the event of any disputes or legal proceedings and it also describes the ownership arrangement of the company.
Pennsylvania Operating Agreement Laws
Pennsylvania provides thorough guidance on setting up an LLC. The state’s operating laws, as defined by Title 15, Chapter 88, offer you detailed information on how to start, form, and identify yourself as a limited liability corporation. The intricacies of this statute may call for a lawyer even if the state doesn’t require you to have one when setting up an LLC.
How Much Does it Cost to Form an LLC in Pennsylvania?
The domestic filing fee in Pennsylvania is $125, while the foreign filing fee is $250.
How to Form an LLC in Pennsylvania?
Follow the below steps to form an LLC in Pennsylvania:
Step 1 – Explore Potential Company Names
Your LLC entity will need a name. However, before you use specific words or phrases to identify your operation, you need to perform a name search on the State of Pennsylvania’s website. This will confirm that you have chosen a unique name not used by another company.
Keep in mind that looking for a potential name may call for finding a corresponding website domain. You may have an exact match between the two. However, you can perform domain registration searches and choose a website address as close as possible to your business name.
Step 2 – Find a Name That Meets State Requirements
Before choosing an LLC name, keep in mind the following requirements required by the state of Pennsylvania:
- Included ‘LLC’ in your name. Limited liability company or its abbreviation must appear in your company name (LLC or L.L.C.) according to Pennsylvania state guidelines.
- Do not mimic the government. Names such as FBI, Treasury, State Department, and others may cause confusion between your LLC and a government agency. Do not use any name that sounds like a federal, state, or local organization.
- Consider additional legal ramifications. You may need additional paperwork and a licensed individual to be part of your company if providing specialized services. For instance, you have additional considerations to follow when declaring an LLC as a doctor, bank, attorney, or university.
- Choose a distinguishable name. This requires that you not have an LLC name that sounds similar to one of another actively operating company. Be careful because you could end up facing lawsuits if you do.
Step 3 – Reserve Chosen Name
Once you found a name that no other company like yours has, you may want to reserve it. This will require a business name registration fee, which may cost you at least $50 if you want to reserve it and could also result in additional fees depending on your LLC requirements.
Step 4 – Register Your Business
Registering your business works hand in hand with choosing the name for it. The State of Pennsylvania has a business website that guides you through the steps of establishing your chosen business structure.
In this case, you would follow the steps to become a limited liability corporation. You can also create a business registration checklist tailored to your startup needs based on state requirements.
Step 5 – Set Up a Legal Business Address
You must provide a legal business address where you would receive mail to your Pennsylvania LLC. This becomes your LLC’s registered agent and establishes your operation’s credibility.
What counts as a legal business address?
You would receive all legal correspondence related to your business at your registered business address. However, the state requires that you use a physical street address. No P.O. Box counts as a registered business address in the state of Pennsylvania.
What if I don’t have a physical business?
If you operate your LLC from your home for now, you can register a business agent. This entity, however, must have a physical Pennsylvania address, and they must have standard business operating hours, which usually are 9 a.m. to 5 p.m.
Step 6 – File Your LLC Certificate of Organization
The Certificate of Organization establishes official authority for your company to operate as a limited liability corporation in this state. You need the following information for your application:
- Your official name and primary place of business
- A physical business address (no P.O. Box)
- Names of your LLC members
- Organizer signature
- Effective LLC formation date
- Indicate primary industry
- Your employer identification number (EIN)
You can file online on the state’s website. Otherwise, you can contact the DOS to confirm which current physical address you can send your LLC operating agreement form to.
Pennsylvania LLC Operating Agreement Template
Below you can find a Pennsylvania LLC operating agreement template:
