Step 1) Verify & Secure Your LLC Name
First things first, you’ve got to choose a great name for your LLC. As a Connecticut-based business, you’ll need a memorable name that hasn’t been taken by another entity -- both for branding and legal purposes. If your name sounds too similar to a competitor’s, people may have difficulty differentiating between the two of you.
Legally, Connecticut requires your LLC name to:
- Be “distinguishable” from any other business name on record with the state. You can do this by running a quick business name search through the Connecticut Secretary of State website to see if your desired name is already taken.
- Contain the abbreviation “LLC” or the words “Limited Liability Company” (“Limited” and “Company” may be abbreviated to “Ltd.” and “Co.”)
What To Do:
Once you’ve decided on a potential name, conduct a business name search through the Secretary of State website. If your desired name is available, this is also a good time to search for a domain name on GoDaddy. Having an easy-to-find business website will be crucial for increasing your brand visibility, so it’s a good idea to take care of this now, even if launching a website isn’t the first thing on your to-do list.
Once you’ve officially settled on a business name, you can either reserve it or move right along to the LLC formation phase. In Connecticut, business name reservations aren’t required, so this all depends on whether or not you’re ready to form an LLC.
Remember, this isn’t optional in Connecticut-- it’s mandatory.
Quick Note: Before you commit 100% to a name, you may also want to check that there’s a decent URL available for your business. Use Weebly to search your options. If there’s a quality domain name for purchase, we advise buying it right away. Even if launching a business website isn’t on your radar right now, it’s going to be soon, and you might as well nail down a domain name that’ll make it easy for customers to find you!
Step 2) Appoint A Connecticut Registered Agent
Before you can officially form your Connecticut LLC, you’ll need to select a registered agent to accept legal documentation on behalf of your business. Your registered agent’s name and address will be requested on your Certificate of Organization, so you won’t get far without knowing these details.
Connecticut does allow business owners to act as their own registered agents, but we encourage you to consider a few things before you sign up for the task:
- You’ll be responsible for maintaining normal business hours (Monday through Friday, 9 am to 5 pm) at your Connecticut address.
- If you run your business from home, your personal address will have to be made public.
- It’s possible that you’ll be served in front of coworkers, customers or family.
It’s our opinion that appointing a registered agent service is your best bet, if only to be sure that all important legal documents are handled properly. That being said, if you don’t want to look outside your business for a registered agent, you can also delegate this task to a business partner or employee.
What To Do:
First, if you’re leaning toward representing yourself or handing the reins over to a colleague, check out our registered agent guide for a closer look at the required duties. If you’re up for the commitment, then by all means, sign yourself up!
Otherwise, the best way to get a professional registered agent is through an online filing service. Providers like IncFile offer a year of registered agent service for free when you form your LLC with them.
Step 3) File Certificate Of Organization
Congratulations on getting to this step! Once you’re through filing your Certificate of Organization, you’ll be a legitimate Connecticut LLC. But before you start celebrating, let’s take a look at some of the information this document will ask for:
- The filing party (who and where to send confirmation to)
- Your business’ name and principal address
- Your registered agent’s full name, business address and residence address
- Manager or member information
- The name and signature of the organizer(s)
If you choose to do this in hard copy, you’ll mail the completed document and a $120.00 check to the following address:
Commercial Recording Division
P.O. Box 150470
Hartford, CT 06115-0470
...or physically bring it to this address:
Commercial Recording Division
30 Trinity St.
HartFord, CT 06106
If you’d rather take care of this step digitally, Connecticut also offers online filing. You can start the process here whenever you’re ready to go.
What To Do:
It’s totally possible to handle this step on your own, but it can be a lot to juggle alongside your other startup obligations. We recommend at least considering the help of an LLC formation service. They’ll handle everything for you and make sure your Certificate of Organization is filed perfectly. Have a look at our top 7 business filing services to learn about these providers’ pricing and features!
Step 4) Get An EIN
Next, it’s time to get an EIN. Your EIN, or Employer Identification Number, is the federal government’s way of tracking your business’ financial activity. You can think of it as a social security number for your business.
Obtaining an EIN is fairly simple, but before starting the application, it’s best to make sure you actually need one. You’re required to have an EIN if:
- Your business has more than one member (i.e. you’re not a single-member LLC)
- You plan to hire employees
- You don’t plan to be taxed as a sole proprietor
You can refer to this IRS page for other specific conditions that require an EIN.
What To Do:
There are a few ways you can go about obtaining an EIN, but our recommendation is to simply do it yourself through the IRS website. Their free online application is the most efficient method, as you’ll get your 9-digit identification number as soon as you’re done filling it out. However, if the online approach doesn’t suit you, check out our guide for other ways to get an EIN for free.
Step 5) Draft An Operating Agreement
If you’re starting a single-member LLC, you can skip through to step 6. However, if you’re working with partners, take note -- having an operating agreement in place is the best way to avoid disputes and maintain control of your business in the face of chaos.
Connecticut does not legally require that you have an operating agreement, but it’s still worth taking the time to draft a document that outlines:
- Each member’s title and responsibilities
- The company’s profit and loss distribution
- The ownership/management structure
- What will happen if a member leaves
…and some other logistical details about your business.
What To Do:
There are a number of ways to go about creating an operating agreement, but here are my two favorite approaches:
- Add a customized operating agreement to your package with an online filing provider (if you’re planning on using one). This might be the cheapest and easiest way for you to draft an operating agreement that’s tailored to your business.
- Use an online operating agreement template. Most services that offer these charge a monthly fee, but some have free trials that last long enough for you and your partners to create a document you all agree on. Take a look at our top 3 LLC operating agreement templates to learn more.
Step 6) Open A Business Bank Account
Too many new business owners have made the mistake of running their businesses through personal bank accounts. We’re here to tell you that having a business bank account is an absolute necessity. Otherwise:
- You’ll find yourself in a mess of trouble when tax time rolls around
- Your personal assets may be put at risk
- You won’t be able to take advantage of business banking perks
Opening a bank account designated for your business expenses is the first step toward smart financial management.
What To Do:
Do some research before committing to a bank. Shop around local banks like Webster Bank and Liberty Bank, and credit unions like Members Credit Union. National banks, like Wells Fargo, are also well-worth considering.
Think about what your top priorities are: online banking, ATM accessibility, customer service, minimum account balances -- every bank has something different to offer in each regard. To get started on your research, read our Wells Fargo and Bank of America reviews. They’re two of our favorite banks that operate in Connecticut!
Step 7) Handle Licensing & Permits
The final bit of business you need to take care of is obtaining any licenses and permits required of your LLC, as well as paying any necessary taxes. After this, you can focus wholeheartedly on building your brand!
Check out these resources to learn about federal, state and local compliance requirements:
- Federal: Head to the federal licenses and permits page on the Small Business Association website to find all the business activities that require special licensing, as well as the corresponding government agencies. As far as federal taxes go, the business taxes page on the IRS website is a great resource.
- State: You can apply for a general Connecticut business license through the CT eLicense website. Their Business Startup Tool is also a good thing to have bookmarked -- it includes a helpful page with links to state-specific licensing requirements.
- Local: To make sure you don’t overlook any city or county-specific requirements, give your local Chamber of Commerce a call or visit.
What To Do:
If all you need is a general business license, this step is pretty simple. However, if it turns out you’re going to need a wide array of permits and licenses to legally conduct business in Connecticut, you might want to look into a business license service. These companies know the ins and outs of business licensing, so if you leverage their services you’ll be able to trust your business will end up fully compliant.
Need Help Forming an LLC?
If you’ve got the time and energy, you may be able to handle the Connecticut LLC formation process on your own.
That being said, many entrepreneurs opt for professional help to make sure nothing slips through the cracks. If you’d like some help forming an LLC in Connecticut, read through our reviews of three of the most popular services available!