Naming Requirements

The LLC’s business name must be different from all other business entity names registered or reserved with the North Carolina Secretary of State. This applies to companies that were formed in North Carolina, as well as those originally formed started outside the state but currently authorized to do business in the Tarheel State.

Your new LLC’s name must include the phrase “Limited Liability Company” or one of its abbreviated forms: “LLC” or “L.L.C.” The name is not allowed to include the words “corporation,” “incorporated,” “limited partnership,” “limited liability partnership,” or any abbreviation of these words and phrases. It also may not have a word or phrase that states or implies that it is organized for a purpose that is not a legal business purpose.

By paying $30, an available LLC name can be reserved for up to 120 days.  

State Timelines

The filing time is 2 weeks and can be expedited in 4 business days. 

State Filing Fees

The filing fee is $125, and can be expedited for an additional $75.

Articles of Organization and Operating Agreement

The formation of a North Carolina LLC means that you have to file articles of organization with the North Carolina Secretary of State. Your new LLC’s articles of organization must include:

The LLC’s name

The name, address, and title (organizer or member) of each person executing the articles

The initial LLC registered office’s address (including county)

The name of the LLC’s initial registered agent at that address

The address of the LLC’s principal office

It must also specify whether the LLC will be manager- or member-managed, as well as whether the LLC is perpetual or of limited duration. If it has a set or “latest” date for dissolution, the period of the LLC’s duration must be stated.

It can also list other items that are included in the operating agreement if the members so desire, so long as they don’t conflict with state law. Your new LLC is officially deemed as “organized” after one original and one copy of the LLC’s articles of organization are delivered to the North Carolina Secretary of State’s office with the filing fee, and that office then verifies that the articles are in compliance with state law. The articles must be signed by at least two organizers.

An organizer is allowed to be any natural person, or it may be a legal or commercial entity. The organizer is not required to be a member of the LLC, but there must be at least one organizer of some type. The organizer who signs the articles must also list his or her name and title (the office by holding which he or she is entitled to sign it, such as organizer, manager, etc.). The North Carolina Secretary of State will 

certify both copies, but will then retain the original and return a signed copy to the LLC or its authorized representative. The articles of organization are effective as of the time and date they are filed, unless otherwise indicated

The operating agreement which is a very important document can be changed by the members as set forth by the agreement itself or applicable state law. Having an operating agreement is not legally required by the state, but it’s a vitally important internal document that sets forth how the LLC will run.

The operating agreement needs to list the LLC’s members, how much each one has invested, how any profits will be distributed, and how much relative weight each member has when voting.

The operating agreement may also include requirements for meetings (notice, quorum, voting rules, etc.) and similar functions, but it doesn’t have to. Usually, though, it does include operating constraints and allowances already contained in state law and policy. It also may contain constraints on the members’ authority to change or repeal the operating agreement or a provision thereof. If there is more than one member, the operating agreement must initially be unanimously approved in writing.

LLCs in North Carolina must have one or more members, and each member must be a natural person or a recognized business entity. A member can acquire an interest in the LLC when it is formed, or by a method specified in the operating agreement. Becoming a member usually requires a contribution of cash or property to the LLC, or it may take to form of services rendered to the LLC. However, a person may be admitted as a member of the LLC without acquiring a membership interest if the articles of organization or operating agreement allow it, or if all the members agree and the new member’s admission is recorded in the LLC’s records.

An LLC member can only resign as permitted in the articles of organization or operating agreement, which usually specify a minimum amount of time before a member is allowed to resign. LLCs have the right to pursue remedies for damages suffered by the LLC that are the result if a member’s resignation.

Registered Agent

A North Carolina LLC must have a registered agent in the state-someone to receive official state legal and administrative correspondence on behalf of the LLC. An LLC registered agent may be an individual who resides in North Carolina or a corporation (whether originally formed in North Carolina or not) that is registered to conduct business in the state. The registered office may be a place of business for the LLC, but a post office box or mail drop is not allowed to be used as the agent’s address.

Ongoing Filing and Compliance 

LLCs in North Carolina must have one or more members, and each member must be a natural person or a recognized business entity. A member can acquire an interest in the LLC when it is formed, or by a method specified in the operating agreement. Becoming a member usually requires a contribution of cash or property to the LLC, or it may take to form of services rendered to the LLC. However, a person may be admitted as a member of the LLC without acquiring a membership interest if the articles of organization or operating agreement allow it, or if all the members agree and the new member’s admission is recorded in the LLC’s records.

An LLC member can only resign as permitted in the articles of organization or operating agreement, which usually specify a minimum amount of time before a member is allowed to resign. LLCs have the right to pursue remedies for damages suffered by the LLC that are the result if a member’s resignation.

Dissolution

An LLC is dissolved when any one of the following events occurs:

Event(s) or a time specified in the articles of organization or operating agreement

Written agreement to dissolve by all the members

Event that makes it illegal for the LLC to continue

If the LLC no longer has any members

Judicial decree ordering dissolution, or the filing of a certificate of dissolution by the state Secretary of State

Unless otherwise specified in the articles of organization or the operating agreement, the approval of all members is required to sell all the LLC’s assets, or to voluntarily dissolve the LLC.

Taxes

An LLC has the availability of more deductions compared to corporations. An  LLC can be a “pass-through entity” when it comes to taxes, so that the LLC owner or owners report business losses or profits on their personal tax returns, in the same way that a partnership would.

Unless you decide that your LLC should be taxed in the same way as a corporation, the IRS looks at single-member LLCs as sole proprietorships. This means that the LLC itself does not pay taxes as such and does not have to file a tax return. The IRS treats multi-owned LLCs as partnerships for tax purposes. Therefore, LLC owners each pay taxes on their lawful share of the profits on their personal income tax returns, not the LLC itself.

The tax rate for North Carolina LLCs varies, based on the amount of North Carolina taxable net income per reporting period.

Special Requirements

None identified 

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