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Last updated: August 24, 2024

Disclaimer: IANAL (I Am Not A Lawyer). Nothing in this section constitutes legal advice. Consult with an attorney and CPA.**

LLC Formation

Do I Need an LLC?​

LLC is formed to separate your personal assets from your business and provide some liability protection.

It doesn't protect against gross negligence.

Depending on your niche, you may still need general liability insurance to protect your business assets in case of litigation, or specific liability insurance depending on your niche (e.g., if you sell ingestibles).

You can generally file for an LLC yourself, and many do.

If your case is anything but super straightforward, or it's your first LLC, it might make sense to use a service like the popular LegalZoom.

I've heard negative things about LegalZoom recently, and most of the small business LLCs I know were formed through Northwest Registered Agent. NOTE: I haven't used them myself yet. They currently offering to file an llc for $39 (plus state fees).

A registered agent, like Northwest Registered Agent, can provide you with a virtual mailbox (a "suite" address) that you can use as your business address. They will receive legal documents for you. Generally, you can sign up just for this service and file for an LLC with the state yourself.

What's the Best State to Form an LLC?​

There isn't a single "best" state to form an LLC. States like Delaware, known for being business-friendly, don’t offer anything special for a small business LLC.

It's usually best to form an LLC in the state you live in. Otherwise, you'd have to register an out-of-state LLC in your home state as a foreign LLC and deal with the administrative costs and overhead of managing two LLCs.

State fees for initial filing and annual filing vary a lot.

Filing for LLC in New York​

New York is known to be one of the most expensive states to run a business.

LLC formation wise, New York has a rule that requires you to issue a publication about a new LLC for two weeks which may cost you up to $2,000 or more. There are services that take care of a publication requirement by making a publication outside of NYC in cheaper areas. This brings this cost down to $200+.

How to Hide Your Personal Information​

Depending on the state, it will vary how much of your personal information is accessible through public records related to your LLC.

If privacy is important to you and you want to avoid exposing your name on publicly accessible documents, Wisconsin offers an anonymous LLC. Your name won't be exposed in any publicly facing documents, including annual filings.

How to Find Information About Existing LLC​

LLC just like DBA (Doing Business As) are state specific entities in US. This is opposite to a trademark that is a nation wide thing.

You can find information about existing LLC using state specific websites:

A few states are listed below:

  • NY:
  • CA:

NEXUS​

Nexus refers to having a strong presence in a specific state. In the case of e-commerce, if you sell 200 orders in a certain state, you have a nexus there and would have to start collecting sales tax from that point.

Generally, if you reside in a state, you have a nexus there, and you'd need to register to collect sales tax in that state.