Many people believe that starting an LLC in SC is difficult and expensive. This is mostly a myth.
It’s not so hard if you take the time to learn about what you need to do. It’s even easier if you use a service like ours that will go through all the steps to form your LLC for you.
The costs of setting up an LLC vary a lot depending on where you plan to form your LLC. If your LLC is in South Carolina, you may save money compared to some other states. South Carolina has a reasonable fee for filing the articles of incorporation and does not charge for a statement of information or an annual report fee.
Let’s go through the costs for South Carolina:
The first step to naming your LLC is to check that the name you want is not already being used. You can do this for free online on the South Carolina Secretary of State’s business name search page.
If you want to register the name, you do that as part of filing the LLC’s Articles of Organization. There is a fee for that (see next section), but there is no separate fee for name registration.
If you are not ready to file the Articles of Organization, but you do want to reserve a business name, you can do that for a fee of $25.
For most businesses, there is no fee to use a DBA (“doing business as” or “fictitious business name”). In South Carolina, only limited partnerships can register DBAs with the state. For those businesses, the filing fee is $10.
To make your LLC official in South Carolina, you need to file a form called articles of organization and pay a filing fee of $110.
You can download the form from the Secretary of State’s website, or you can enter the information online.
To file online, start on the state’s business name search page. Enter the name you would like for your LLC. If it shows up as available, then click on the “add new entity” button.
Follow the instructions to register for an account with the Secretary of State, if you don’t already have one. Then you can enter the information needed to file the articles of organization and register your LLC.
You’ll provide the name of your LLC, address of the designated office, name and address of the agent for service of process, name and address of each organizer, and signatures of all the organizers.
In South Carolina, unlike in some other states, you do not need to file a statement of information. So, that’s one less form and fee you have to worry about.
To operate an LLC in South Carolina, you’re required to appoint a registered agent. This is somebody who will be available for service of process if your LLC ever gets sued. The agent will also be a contact person for your business and will accept legal documents from the state and pass them on to you.
The agent must be someone who lives in South Carolina, and they must have a physical office in the state.
You can be your own registered agent. If you choose this option, then there’s no cost. However, you’ll need to make sure that someone is available in the registered office every day during business hours.
You can also hire someone to be your registered agent. A registered agent service, like the one we provide, can help you find a registered agent who meets all of South Carolina’s requirements.
The fee for our registered agent service is $199 per year. Other services might charge as much as $400.
An operating agreement is a contract between the members of your LLC. In South Carolina, creating an operating agreement for your LLC is optional, but we strongly recommend that you have one. It helps ensure that your business will run smoothly, and it helps prevent disputes between members of the LLC.
Even if you have a single-member LLC, where you are the only member, you should still have an operating agreement. It can help make the liability protection of your LLC more secure by showing that your business operations and finances are separate from your personal finances.
You could write an operating agreement yourself at no cost. You’d need to understand what you are doing and feel comfortable creating legally binding agreements.
Many LLC owners choose to have a lawyer or an operating agreement service, like the one we provide, create their operating agreement for them. The cost for a lawyer could be up to $1,000 or more. Using a service will save you money, with fees starting as low as $99.
A franchise tax is a tax that is in addition to the business income tax. While South Carolina does not have a franchise tax, per se, it does have a corporate license fee that operates in a similar way.
The license fee applies to LLCs only if they are organized as traditional corporations or S corporations. It’s calculated using a formula based on the worth of the business. The minimum fee is $25 per year.
Business licenses issued by counties, cities, and towns give you permission to operate your LLC within the local area. South Carolina, unlike many other states, does not issue statewide general business licenses. All general business licenses are local.
Permits may also be necessary to operate your LLC. They show that your business has met certain safety requirements.
The fees for licenses and permits vary by municipality. You should check with the clerk of the county, city, or town for information on costs.
South Carolina municipalities may also have an annual business license tax based on the gross revenue of your business and the activity your business is engaged in.
Common licenses in South Carolina include:
Common permits include:
In most states, you must pay a fee yearly to file an annual report for your business.
In South Carolina, LLCs are not required to file annual reports. No annual report means no fees — and you save money!
In some states, LLCs have to pay an annual fee based on their income.
In general, an LLC is not required to pay fees based on income in South Carolina. An exception is that some (not all) LLCs that are organized as corporations may have to pay an annual corporate license fee.
The corporate license fee is equal to 0.1% of the capital and paid-in surplus, plus an additional $15. The minimum annual fee is $25.
Here’s some good news about your South Carolina LLC. Most of the costs you incur to form your LLC can be deducted from your taxes.
These deductible expenses may include:
It’s a good idea to consult a tax professional to determine what deductions apply in your situation. And more good news: The fees you pay your tax professional may be deductible too!
LLC Filing fee | $110 |
Business license | Varies by municipality and type of license. For example, Charleston charges $64 plus $3.90 for each additional expected $1,000 of income for a city business license; and $200 for a zoning and application review fee. |
Registered agent (optional) | $199 – $400 |
Reserve business name (optional) | $25 |
Filing a DBA (optional) | $10 for limited partnerships No cost (and no filing requirement) for all other types of businesses |
Operating agreement (optional) | $0 to $1,000 |
When you’re trying to start an LLC for a small business, figuring out all the details and requirements can seem overwhelming.
We understand. That’s why we offer our LLC formation service — to make it easier for you to get your business up and running.
We love to see small business owners succeed and enjoy the advantages that an LLC will bring.
Forming an LLC doesn’t have to be painful! Let us use our experience and expertise to set your LLC up, and you can say goodbye to the frustration of navigating complicated and unfamiliar requirements on your own.
We provide our LLC formation services for a reasonable cost — and you can probably write off the cost on your taxes! Contact us to get one step closer to making your business dream a reality.
This portion of our website is for informational purposes only. Tailor Brands is not a law firm, and none of the information on this website constitutes or is intended to convey legal advice. All statements, opinions, recommendations, and conclusions are solely the expression of the author and provided on an as-is basis. Accordingly, Tailor Brands is not responsible for the information and/or its accuracy or completeness.
Shai Shmarel started his life as a corporate lawyer before switching to being an SEO and Content Manager at Tailor Brands. He has experience in managing companies, rankings SERPs and covering a content-driven approach for all things legal, business and marketing. When off work, you’ll usually find him chilling with a cup of coffee and a book in the desert.
Products
Resources
@2024 Copyright Tailor Brands