How To Start a Connecticut LLC
By Bazal Razzaq
Updated: August 14, 2023, 12:30pm
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- Select a name for your Connecticut LLC
- Put together a business plan
- Appoint a registered agent
- Prepare and file your Articles of Incorporation with the Connecticut Secretary of State
- Apply for an EIN with the IRS
- Create an Operating Agreement for your Connecticut LLC
- Submit the Statement of Information
- Final Word
- How To Form An LLC In 50 States
- Frequently Asked Questions (FAQs)
Starting in 2010, Connecticut had more and more new businesses opening up yearly, increasing by about 5% regularly. But in 2021, there was a significant increase of 20% in new business registrations in the State.
Being near Boston and New York City, Connecticut, is the perfect choice for entrepreneurs looking for the opportunities these big cities offer but don’t actually want to start a business in a big city.
Whatever your story may be, if you are looking for a detailed guide on how to set up your Connecticut LLC, please be at home. Here are seven steps to forming an LLC in the Constitution State.
#1 Select a name for your Connecticut LLC
The very first and most obvious step is to select a unique and memorable name for your LLC. You have the option to operate your Connecticut LLC in two ways,
- With its legal name,
- or by adopting a DBA (“doing business as”).
For those wondering what a DBA is, it’s basically a pseudonym or a fictional name by which the audience and the customers engage with your brand. A “DBA” stands for “Doing Business As.” It’s like a nickname for your business.
For example, let’s say you have an LLC called “GreenTech Innovations LLC” but want to do business under the name “EcoGadgets.” That “EcoGadgets” is a “Doing Business As” or DBA name for your LLC. It helps customers know you by the name you deem more memorable, marketable, and relevant to your products/services.
Note: Remember to always register your DBA in your local community. DBAs aren’t registered with the Connecticut Secretary of State. You simply need to apply for a Trade Name Certificate with your town clerk.
- The name should be different than any other registered business entity in Connecticut. For reference, you can search online business records to confirm that no other company has used it.
- Avoid using words that might confuse people and make them think your business is something it’s really not, like a bank, corporation, FBI, or CIA.
- The name should have no rude, forbidden, or lewd terms(according to the Connecticut Secretary of State).
- It’s best to stay away from terms like “trustee,” “board,” or “insurance” that could restrict your business’s identity.
- The name should not already be in use as a website domain to avoid trademark or legal issues.
- Your name should show that it’s a Limited Liability Company. It’s a good idea to end the name with abbreviations like “LLC,” “LLC,” or “Ltd.” Most people just use “LLC.”
- Some words like “lawyer,” “credit union,” and “attorney” have special restrictions given their professional nature. You’d need to provide additional documents and licensing to the state government.
Once you’ve decided on a unique name for your Connecticut LLC, you need to take the next step to reserve that name.
#2 Put together a business plan
A well-crafted business plan is often the roadmap to your company’s success and financial stability. A detailed business plan includes the following key elements:
- Executive Summary: A concise overview of your business concept, goals, and highlights.
- Business Description: Detailed explanation of your business, its mission, vision, and what it offers.
- Market Analysis: Research your industry, target market, competition, and trends.
Organization and Management: Information about your team, organizational structure, and roles.
- Products or Services: Detailed description of what you’re offering, its features, benefits, and uniqueness.
- Marketing and Sales Strategy: Plans for promoting and selling your products or services, including pricing and distribution.
- Funding Request: If seeking funding, outline the amount, purpose, and how you’ll use the funds.
- Financial Projections: Projected income statements, balance sheets, and cash flow statements.
- Operational Plan: Details on how your business will run day-to-day, including location, facilities, and processes.
- Implementation Timeline: Milestones and timelines for achieving key goals.
- Appendices: Supporting documents like resumes, legal agreements, market research, and other relevant information.
#3 Appoint a registered agent
To ensure the proper formation of your LLC, you need to hire a registered agent. This agent will receive important legal, financial, and official notices and documentation for your business.
You also have the option to serve as your own registered agent or hire a professional registered agent service for your LLC.
Here are the general requirements for a registered agent in Connecticut:
- Physical Presence: The registered agent should have a physical street address in Connecticut.
- Age: They should be at least 18 years of age.
- Availability: They must be available during regular business hours to receive legal documents on behalf of the LLC.
- Consent: The registered agent must agree to the role and responsibilities.
- Official Communication: They handle all the legal notices, tax documents, and other official correspondence for the LLC.
- Updated Information: Keep the registered agent’s information current with the Connecticut Secretary of State.
- Reliable Contact: They should reliably forward received documents to the LLC promptly.
Lastly, once you’ve picked a suitable registered agent, make sure to include their name in your Certificate of Organization document.
#4 Prepare and file your Articles of Incorporation with the Connecticut Secretary of State
All domestic LLCs in Connecticut need to file their Certificate of Organization document with the Secretary of State office. In contrast, all Foreign LLCs need to submit a Foreign Registration Statement form.
You can either download and complete the forms later or with Connecticut. You can perform the entire registration process online. Instead, if you prefer to submit your form by mail, you can send it to the address listed below.
Business Service Division, Connecticut Secretary of the State
PO Box 150470
Hartford, CT 06115
Business Service Division, Connecticut Secretary of the State
30 Trinity St.
Hartford, CT 06106
You can also consider submitting the document in person if nothing else works. The filing fee is $120 for domestic and foreign LLCs, and the process could take a few days to a couple of weeks.
Here’s a general idea of all the information you need to provide in an Articles of Organization document,
- The name and business address of your Connecticut LLC.
- The name and address of at least one managing member/owner.
- LLC’s email address
- The name and address of your registered agent
- The names and addresses of all LLC organizers (founding members)
- The exact LLC kind, whether it’s a normal limited liability company or a PLLC(professional limited liability company)
- The main purpose of your business
#5 Apply for an EIN with the IRS
If your LLC has more than one member/owner, then you need to obtain an EIN from the Internal Revenue Service(IRS). This nine-digit number is used for taxation purposes and can also be required for any of the following activities,
- Hiring employees for your LLC
- Opening a professional business bank account
- Getting funding/business loan
- Conducting business with vendors
- Apply for different business licenses and permits
- Handle and pay your state and federal taxes to the government
That being said, it’s also a good idea for single member LLCs to consider getting an EIN. The application for getting one is pretty fast and simple, and as soon as you hit submit, you’ll get a number for your Delaware LLC. The state will also give a 7-digit number to new businesses, which can be used for state taxes and other LLC stuff.
Also, if you own a single member LLC(SMLLC) and decide not to get an EIN, you’ll have to use your Social Security number on official papers asking for an EIN. Getting an EIN is a good idea to avoid risking your personal details, which adds extra protection.The next step in your Connecticut LLC formation journey is to obtain your nine-digit EIN from the Internal Revenue Service (IRS). It’s basically like a Social Security Number(SSN) and is used for taxation purposes.
A federal employer identification number is important for a lot of reasons, including,
Applying for business licenses and permits.
Hiring new employees
Paying off the state and federal taxes
Opening a business bank account
Conducting regular business operations
If you wish to mail it instead, you can use the address mentioned below:
Internal Revenue Service
Attn: EIN Operation
Fax: (855) 641-6935
After getting your federal EIN, you can also get a sales tax and use permit from the Connecticut Department of Revenue Services. This permit costs $100.
#6 Create an Operating Agreement for your Connecticut LLC
While it’s not mandatory for Connecticut LLCs to have an operating agreement, all successful ones do! An LLC agreement details how your company operates and defines the roles, rights, responsibilities, and ownership of your membership group.
A typical LLC operating agreement includes the following:
- LLC Name and DBA (if used)
- Business Address of the LLC
- Duration of LLC (temporary or perpetual)
- List of Members and Ownership Percentages
- Registered Agent’s Name and Address
- Business Scope
- Profit and Loss Sharing Plan
- Adding or Removing Members Process
- Important Member Decisions and Voting Procedures
- Member Responsibilities
- Indemnification and Liability Policies
A well-mapped-out agreement is important for multiple reasons, including member voting rights and the LLC’s dissolution. It is also helpful during member conflicts and clarifying financial responsibilities.
#7 Submit the Statement of Information
After forming an LLC in Connecticut, you have to maintain accurate details through annual reports. These reports typically don’t require any financial information. The filing fee is $80 for both Domestic and Foreign entities. You need to file the report with the company’s latest information on Connecticut’s business portal.
They’re due by 31st March every year. Any annual report filed after the mentioned date will receive a “Not in Good Standing” status with the state.
Online filing is mandatory unless you’re granted a waiver permitting mail submissions.
Once your Connecticut LLC is set up, don’t sit pretty just yet! There are plenty of formalities to take up your time, so it’s best to remain informed beforehand.
With a registered LLC, you can,
- Buy insurance to protect your LLC
- Open a professional business bank account and apply for a business credit card.
- Register your LLC with the state and federal tax agency.
- Trademark your name and logo
- Obtain necessary business licenses and permits.
If you’re looking to hire workers for your Connecticut LLC, make sure to stay within the legal guidelines by taking these actions:
- Confirm eligibility of new employees to work in the US.
- Report newly hired employees to the state as required.
- Offer workers’ compensation insurance.
- Deduct and manage employee taxes appropriately.
- Display workplace compliance posters visibly in your workspace.
You can refer to the Connecticut Department of Labor for further details.
And that’s a wrap! That was all you needed to know before forming that LLC in The Constitution State. Armed with this guide, you can confidently take the first steps toward making your business dreams a reality!
Frequently Asked Questions
The main steps include:
- Choose a name and check availability.
- File the Articles of Organization with the Secretary of the State and pay the filing fee.
- Designate a registered agent with a physical address in Connecticut.
- Create an Operating Agreement outlining the management and operation of the LLC.
- Obtain any necessary licenses or permits.
Yes, every Connecticut LLC is required to have a registered agent. This agent accepts legal documents on behalf of the LLC and ensures proper communication with the state.
An Operating Agreement is a legal document that outlines the ownership structure, management roles, and operating procedures of the LLC. While Connecticut doesn’t legally require an Operating Agreement, having one is highly recommended as it clarifies member responsibilities and reduces conflicts.