Starting an LLC in North Carolina
A limited liability company (LLC) is a business structure with strong liability protection, adaptable management options, and certain tax advantages. To officially form an LLC in North Carolina, you’ll need to file Articles of Organization with the North Carolina Secretary of State and pay the $125 filing fee. But before you can complete the form, you need to choose a business name and registered agent. North Carolina will process your Articles of Organization 3-5 business days after receiving them. Here’s a step-by-step guide to getting your LLC on the books and ready to do business.
Ready to Start a North Carolina LLC?Get Started
Name Your LLC
Designate a Registered Agent
Submit LLC Articles of Organization
Write an LLC Operating Agreement
Get an EIN
Open a Bank Account
Fund the LLC
File reports + taxes
1. Name Your LLC
To begin, you need a business name for your LLC, and that business name needs to meet North Carolina’s requirements as outlined in N.C. Gen Stat § 55D-20. Basically, your LLC’s name must:
- Include a designator like “LLC,” “L.L.C.,” or “limited liability company.”
- Not include any words prohibited for use in North Carolina business names (for example: “Bank” or “Architect”) unless you have proper approval.
- Not contain any offensive words.
- Be “distinguishable” (unique) among business names in North Carolina.
Already have a business name? Check to see if it’s available.
Can I reserve a business name in North Carolina?
Yes. If you want to prevent another business from adopting your desired business name while you prepare to form an LLC, you can do so by filing the Application to Reserve a Business Entity Name with the North Carolina Secretary of State. The form costs $30 to file and will reserve your business name for 120 days.
What’s the difference between my LLC’s name and an assumed business name?
The legal name of your LLC is the business name stated on your Articles of Organization. An assumed business name (sometimes called a DBA) is any name other than your LLC’s legal name or your own first and last name under which you transact business.
If you plan on doing business under a different name in North Carolina, you’ll need to register the name first. To do so, you’ll need to file an Assumed Business Name Certificate with your local county’s Register of Deeds.
Learn more about How to Get a DBA.
2. Designate a Registered Agent
The next step is finding a North Carolina registered agent. A registered agent is someone you appoint to accept important legal and state mail on behalf of your LLC. Your registered agent could be you, another individual, or a company (like us). In North Carolina, every LLC is required to keep and maintain a registered agent. Before you can move on to the next step (filing Articles of Organization), you’ll need to know your registered agent’s name and address.
Learn why the pros use a registered agent service.
What does a registered agent do?
The requirements for a registered agent in North Carolina are detailed in N.C. Gen Stat § 55D-30, but here’s the lowdown.
At a minimum, your registered agent must:
- Have a street address (no PO boxes or virtual offices) in the state of North Carolina.
- Keep regular business hours.
- Agree to accept legal mail (called service of process) on behalf of your business and forward it to you fast.
Can you be your own registered agent in North Carolina?
Yes. As long as you’re okay with listing your name and physical address on the public record, you can be your own registered agent. Keep in mind that you’ll need to keep regular business hours at this location and be available to accept any legal mail in person.
How do I maintain a registered agent in North Carolina?
To maintain a registered agent in North Carolina, you just need to keep the North Carolina Secretary of State updated on your registered agent’s information. This means that if your registered agent resigns or moves, you’ll need to file the proper paperwork to let the Secretary of State know.
Can I change my registered agent after I start an LLC?
Yes. You can change your registered agent in North Carolina anytime by filing the Statement of Change of Registered Agent form with the North Carolina Secretary of State. Changing your registered agent costs $5.
3. Submit LLC Articles of Organization
To officially form your LLC, you’ll need to complete a form called Articles of Organization. When the form is completed, you’ll submit it to the North Carolina Secretary of State online, by mail, or in person with the $125 filing fee.
Note: All of the information on this form will become part of the public record.
Compliance with N.C. Gen Stat § 84-2.2:
An attorney licensed to practice law in the State of North Carolina has reviewed the blank template offered on our website to North Carolina consumers, including each and every part thereof that may appear in the completed document. The name and address of the reviewing attorney is kept on file by Northwest Registered Agent Service, Inc and will be provided to the consumer upon request.
The forms or templates provided by Northwest Registered Agent Service, Inc (“Northwest”) are not a substitute for the advice or services of an attorney.
Northwest does not disclaim any warranties or liability and does not limit the recovery of damages or other remedies by the consumer. Northwest does not require the consumer to agree to jurisdiction or venue in any state other than North Carolina for the resolution of disputes between the provider and the consumer.
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To fill out the form, you’ll need to provide the following information about your LLC:
- Company name. Include an indicator like “LLC.”
- Executor. Whoever files the Articles of Organization on behalf of your LLC.
- Registered agent. This is someone designated to accept service of process on behalf of your LLC.
- Registered office. This must be a physical address in North Carolina where your registered agent can be found during business hours.
- Mailing address. Only add if different from your registered agent’s address.
- Principal office. If you have a main office address, you may list it here.
- Professional services. This is for PLLCs (LLCs that provide a state-licensed service like law or medicine).
- Additional provisions. Optional, but you can add any extra provisions that don’t violate the law here. For example: descriptions of the rights and duties of your members.
- Company officials. Optional, but you can list your LLC’s members and/or managers.
- Business email. Optional. This is where the Secretary of State will send notifications.
- Managers. Optional, but your bank may require it.
- Effective date. Optional, but you can choose to add a future start date up to 90 days in the future.
How can I keep my personal information off the public record?
The Articles of Organization are a public document, which means all of the names, addresses, and other personal information listed here will be searchable online. Marketers will find your information, send you mountains of junk mail, and then sell your information to the next guy, who will do the same. And so on.
The best way to protect your personal information from aggressive marketers is to hire a registered agent (like us!) who will list their business address on this form so that you don’t have to. It’s the most effective way to guard your privacy when forming an LLC.
What’s the difference between a member-managed and manager-managed LLC?
Members are the owners of an LLC, and in a member-managed LLC, members take care of the LLC’s day-to-day operations. In a manager-managed LLC, members hire a manager or managers to take care of the LLC’s day-to-day operations. Whoever manages your LLC will have the power to hire and fire employees, open bank accounts, and enter into contracts, among other key tasks. Most LLCs are member-managed.
For help with deciding on a management structure, see our page on LLC Member Vs Manager.
How do I file the North Carolina Articles of Organization?
You can submit your articles online, by mail, or in person.
Mail and in person:
North Carolina, Secretary of State
Business Registration Division
P.O. Box 29622
Raleigh, NC 27626
4. Write an LLC Operating Agreement
An operating agreement is a document the establishes the rules and organizational structure of your LLC. It specifies how your LLC will handle important procedures like allocating profits and losses, voting, transferring membership, and even dissolving the business—should the time come.
Check out our attorney-drafted North Carolina LLC Operating Agreement.
Does North Carolina require an LLC to have an operating agreement?
No. NC Gen Stat § 58D-2-30 describes the powers and limitations of operating agreements in North Carolina, but doesn’t require LLCs to adopt one. That said, you should still consider an operating agreement to be absolutely necessary for your LLC. Without one, you’ll have difficulty opening a bank account for your business and defending your limited liability status in court, should the need arise. Plus, LLCs without operating agreements are automatically subject to North Carolina’s default LLC statutes, which may not be the best fit for your business.
What should be included in an operating agreement?
Your operating agreement should cover all the major internal processes your LLC will need to undertake—everything from doling out profits to dissolving the LLC. Here’s a common list of topics LLC operating agreements address:
- initial investments
- profits, losses, and distributions
- voting rights, decision-making powers, and management
- transfer of membership interest
- dissolving the business
Does a single-member LLC need an operating agreement?
Yes. You might not need an operating agreement to resolve a conflict between your members, but you’ll need an operating agreement to open a bank account and maybe even to reinforce your LLC’s limited liability in court.
5. Get an EIN
An employer identification number (EIN or FEIN) is your LLC’s tax identification number. The IRS will assign your LLC an EIN and use it to identify your business on tax filings. To get an EIN, you’ll need to apply directly with the IRS for free. Applying online is the fastest way to obtain one, but you’ll need to use the paper form if you don’t have a social security number.
Do I need an EIN for my North Carolina LLC?
Yes. Legally, you only need an EIN if you have employees or are taxed as a corporation. But just about every bank requires an EIN to open a business bank account. Plus, if you have an EIN for your North Carolina LLC, you won’t need to provide vendors or other strangers with your social security number.
What To Do After Forming a North Carolina LLC
6. Open a Bank Account
Every LLC needs its own business bank account. Mixing business and personal money is bad news—doing so erodes the legal separation between you and your business and put your LLC’s limited liability in jeopardy. So open a business bank account!
To open a bank account for your North Carolina LLC, you’ll need to bring the following to the bank:
- North Carolina LLC Articles of Organization (a copy is fine)
- the LLC’s operating agreement
- the LLC’s EIN
- an LLC Resolution to Open a Bank Account (if your LLC has more than one member)
If your LLC has more than one member, use our free LLC Resolution to Open a Bank Account.
7. Fund the LLC
Next, you’ll need to fund your LLC’s bank account. Typically, each member makes an initial contribution by depositing money into the LLC’s bank account. These contributions pay for membership interest. Sometimes, though, members make initial contributions in the form of property or services. Keep in mind that members who take this route might want to consult with a tax professional—property or services contributions may trigger a tax event.
What is LLC membership interest?
Membership interest is the percentage of ownership a member holds of an LLC, and is usually directly correlated to how much each member initially invested. For example: if one member deposits $2,000 to the LLC’s bank account and the only other member invests $8,000, the first member owns 20% of the business and the second member owns 80%.
Membership interest usually determines voting power. So in the above example, the second member would hold decision-making power in the LLC, unless another arrangement is established in the operating agreement.
8. File State Reports & Taxes
In North Carolina, LLCs file an annual report with the state each year. The purpose of this report is to keep the Secretary of State updated on your LLC’s contact information. The North Carolina annual report costs $200 to file ($202 if you file online). If you forget to file an annual report (easy to do!) the Secretary of State could administratively dissolve your LLC.
Worried you’ll forget? Let us file your annual report for you.
When is the North Carolina Annual Report due?
For North Carolina LLCs, annual reports are always due on April 15th.
How are North Carolina LLCs taxed?
By default, LLCs are taxed as pass-through entities. This means that the LLC’s profits “pass through” the LLC itself to the members (owners), who then report those profits as earnings on their personal tax filings. The LLC’s profits are subject to the self-employment tax rate (15.3%). LLCs can elect to change tax designation and be taxed as an S-Corp by filing paperwork with the IRS.
Learn more about S-Corp Vs LLC tax designation.