How to Start an LLC in South Carolina (Step-by-Step Guide)

There are two ways to form an LLC. You can either use a professional LLC formation service, or you can do the work yourself. Both options have pros and cons to consider.

If you use a service, two great options are ZenBusiness and Northwest Registered Agent. These are two companies that specialize in helping business owners form new business entities, including LLCs and corporations. They are essentially middlemen between you and the SC Secretary of State’s department.

With a service, you have the advantage of using a slick modern system to get your business registered. You will work with the service itself to prepare and file all the necessary paperwork, with tons of tips and tricks along the way. And if you run into any roadblocks, you can contact support for personalized help.

Northwest Registered Agent’s first year is free (plus state fees), then $39/year (plus state fees), so it’s quite affordable – and well worth it, considering how much time you will save.

The alternative is to complete the necessary steps on your own. Keep reading for a step-by-step breakdown.

Now, it’s time to select a name for your LLC. This should be a name that is relevant to your industry/business, and one that is memorable/catchy for your clients or customers.

Beyond choosing a “good” name, the name must also meet certain criteria. The most important is that the name must be unique from other businesses already registered in South Carolina.

Other requirements include the use of “Limited Liability Company”, “LLC”, or “L.L.C.” in the business name, as well as the avoidance of certain restricted words. For example, you cannot use any government-related terms, and banking/finance-related terms may require additional permission.

When you have found a name that meets the criteria and that you like, you can move on to step #3 below.

Each new LLC in South Carolina must appoint a Registered Agent. This agent is the main point of contact for the business and is charged with receiving tax documents, legal notices, and more on behalf of the company. Obviously, this is an important role to fill!

You can be your own Registered Agent, or you can appoint an employee (or any other resident of South Carolina). However, do keep in mind that the Agent’s mailing address will become a public record.

Alternatively, you can simply use a professional Registered Agent service. A service (such as ZenBusiness or Northwest Registered Agent) provides all the key services of a registered agent, and also allows you to keep your own address private. Plus, if you’re ever on vacation or otherwise unavailable, you won’t need to worry about missing an important mailing or document.

You will need to decide on your choice of Registered Agent before moving on to the next step, as you will need the Agent’s information to file the Articles of Organization.

Note: This step is optional, but recommended.

Most LLCs should have an operating agreement – however, this step is technically optional, because you don’t need to submit the agreement anywhere. Even so, it’s strongly recommended to have one – particularly if your business has multiple owners.

What is an operating agreement? It’s an internal document that is drafted and agreed upon by all stakeholders of the company. Its basic function is to establish operating procedures and ownership structure guidelines for the new business. Thus, it’s vital to help avoid ownership conflicts in the future.

Using a service like ZenBusiness is helpful for this step because ZenBusiness provides a detailed template that you can use to draft an operating agreement. You could also opt to work with a local attorney in order to draft your agreement.

The South Carolina LLC Articles of Organization must be filed with the Secretary of State’s department in order to form an LLC in the state. This process can be done online, or through the mail. There is a nonrefundable $110 filing fee, which is payable to the South Carolina Secretary of State.

Once submitted, you will need to wait for everything to be processed. This generally takes up to 6-7 business days but may be quicker or slower depending on the current backlog.

Most businesses will want to obtain an employer identification number (EIN) from the Internal Revenue Service. This is a federal tax ID number used like a social security number for your business. It will be used on all federal tax filings and reports, and it’s required to hire employees.

You can apply for an EIN in minutes on the IRS website. There is no cost for the application, and most of the time EINs are issued instantly.

Many businesses will require various permits and licenses in order to operate legally. This is in addition to the LLC formation paperwork discussed above. Of course, the specific requirements vary depending on the type of business – as well as the location(s) where the business will operate.

South Carolina does not require a statewide general business license. However, certain business activities and industries will require a license from the state. You will need to research your specific requirements at the state level.

Federally, the situation is similar. There is no “general purpose” federal business license. However, many industries are subject to regulations and may require additional licenses or permits on the federal level. This includes industries like agriculture, finance, and healthcare.

And finally, there are some local-level requirements from city and county governments. Most cities do require a general business license, and specialty health permits, liquor licenses, etc. may also be required. Check with local government offices for details.

Once your business is formed and up and running, you will have a brief break from compliance reporting requirements. But it won’t last too long! Most businesses have many annual requirements (tax returns, annual reports, permit renewals, etc.) as well as some quarterly responsibilities (federal quarterly taxes, employer taxes, etc.)

Thus, every business owner will need to continually work to keep their company in good standing with various state and local authorities, as well as the IRS. The specific requirements do vary depending on the type of business you run, but some of the most common needs are listed below.

This list is certainly not exhaustive, so you will want to do your own research. Once you have a list of all your responsibilities as a business owner, it’s a good idea to set calendar reminders for key due dates, so that you don’t miss any filings.

If you want help with ongoing compliance needs, services like ZenBusiness and Northwest Registered Agent may be of some assistance. They can help with certain filings directly, and send reminders for common due dates to help you stay on track. Your accountant or CPA may also be able to help with certain tasks.

Once you have an EIN and your formation documents/business licenses, you can open a new bank account for your business. And you should do this as soon as possible because it is very important to keep your business and personal finances as separate as possible.

To open a business bank account, visit a local bank or credit union. You may wish to call ahead to see what their requirements are, and what you’ll need to bring. Once the account is opened, use this new account for ALL business transactions.

By separating your business and personal finances, you can keep your accounting efforts much simpler and cleaner. Plus, if your business ever gets sued, your personal assets will be more protected.