Connecticut LLC

1. Name Your LLC

Selecting a business name is a very important initial move. Your name should be distinct, catchy and should be representative of what your business is. Here's how to approach it:

Select a Business Idea: Before naming your LLC, be sure what you are going to be doing.
Seek Advice of People You Know: Ask your friends or colleagues about their ideas on what to do.
Check domain availability: Web Search: Check the availability of the domain and no other similar businesses can be found in Connecticut that can cause confusion.
Use Online Name Generator: Get some inspiration but do not be tied to it only.

Availability of Check Name in Connecticut

After making some options, check availability:

Search of Connecticut State Name: Check to make sure that the name is not in use.

In Connecticut, your LLC name should contain the term Limited Liability Company or an approved abbreviation (LLC or L.L.C.); and must not contain any words that may lead to confusion with any government agency.

Moreover, the business name should not have any restricted words like bank, insurances, and university without authorization by the relevant state authorities.

Check Federal Trademarks

Make sure that the name is not federally registered as a trademark through the US Patent and Trademark Office (USPTO).

Name Reservation

Name Reservation File a Name Reservation online using the Connecticut Secretary of State Business Services site (you must have a CT.gov account).

In Connecticut, the fee to register a name is 60. The name of the LLC which has been reserved will be held in 120 days after your application has been processed.

Trade Name (Doing Business As DBA)

To conduct business under your name other than your LLC, you have to register a trade name with the town clerk where you are conducting business.

There are various charges to file (ranging between 10 and 20 dollars).
This permits various products lines or bank accounts of different business names.

2. Select a Registered Agent

The Connecticut law expects LLCs to provide a registered agent to receive legal, tax, and financial documents.

Requirement of Registered Agent

Must be 18 years or older
Should have a physical location in Connecticut.
Should be accessible at the standard business hours.
A business entity, needs to be registered in order to conduct operation in Connecticut.

To save time and be in compliance, many owners of LLCs engage an agent registered service. Also, you may act as the agent to yourself provided you satisfy the above requirements.

3. Decide on Your Management Structure

Connecticut LLCs can be held in the form of the member-managed and manager-managed form and the selection of the appropriate form is determined by whether the owners would like to be actively involved in the daily operations.

Member-Managed

Daily operations are dealt with by members. Recommended where the members are active and the LLC is small.

Manager-Managed

Operations are done by designated managers (who may or may not be members). It can be suitable to have several members who may want to play a passive role.

By default, an LLC in Connecticut assumes a member-managed but should not do so unless that is indicated in the Certificate of Organization.

4. Register Certificate of Organization

You need only file a Certificate of Organization with the Connecticut Secretary of State in order to legally establish your LLC.

Required Information

Entering party name and address.
LLC name
Principal office address
Information on registered agents and address of the office.
Information of the members or managers.
Business email
NAICS code

The filing fee is $120. Confirmation may take between 3 to 5 business days after you have made your filing.

Connecticut Secretary of State

Business Services Division
PO Box 150470, Hartford, CT 06115-0470

Phone: (860) 509-6200
Email: bsd@ct.gov

5. Write up an Operating Agreement

Even though this is not a legal requirement, an Operating Agreement is highly advised. It provides member obligations, ownership and operations.

Typical Elements

Name and address of the LLC principal address.
Duration of LLC
Registered agent details
Eligibility and participation of voters.
Profit and loss allocation
Member adding/removing procedures.
Policies and dispute resolution.
Keeping of records and communication.

Online templates can be used, but an attorney is a sure way of protection.

6. Get an Employer Identification Number (EIN)

Tax purposes give the IRS an EIN.

Required if:

Multi-member LLC
Hiring employees

Application: Online on the IRS web site.

The responsible party should be a naturalized person, who holds the money or property of the LLC.

EIN applications that are submitted by mail, fax, or through the internet should also entail the name and Taxpayer Identification Number (SSN, ITIN, or EIN) of the true principal officer, general partner, grantor, owner, or trustor of the entity being applied to. The IRS calls such an individual the responsible party. The person in control, management, or direction of the entity and its funds and assets is the one that is responsible. Regardless of being a government or not, the party accountable should be a natural person as opposed to another business or entity.

7. Essentials of Business Licenses and Permits

Depending on the operations of your business, your LLC can be subjected to licenses or permits on the federal, state, and local levels:

Common Requirements

Federal: OSHA, health licenses, industry-related permits.
State: licensing: Connecticut Department of Consumer Protection.
Local: Zoning, building, DBA, fire and sign permits.

A sales tax permit is required in the sale of taxable goods/services.

It is important that compliance is done to evade fines or penalties. It is worth considering hiring a business attorney or some services such as MyCorporation to get fully licensed.

This is one of the most significant steps in the formation of LLC, therefore, ensure that you enquire in your state and local government offices to determine all the licenses and permits that are required.

8. Determine Your Tax Status

The LLCs are in default pass-through. The profit/losses are transferred to the personal income tax returns of the members:

Default Tax Treatment

Single-member LLC: taxed as sole proprietorship; report on of Schedule C; self-employment taxes are paid.
Multi-member LLC: Partnership; file Form 1065; each member shows his or her share on personal returns.

Involuntary Corporate Election

C-Corporation (Form 8832): So on income of the corporation; dividends to members subject to taxation (two time taxation).
S-Corporation (Form 2553): Pass-through taxation; the members should receive reasonable salary; they can save on self-employment taxes.

Connecticut Taxes

Pass-through (no state income tax) LLC.
Gather and collect sales tax on taxable goods/services.
Payroll tax You are liable to withhold state payroll taxes when you have employees.

Other LLC Requirements

Open a Business Bank Account

Separate these personal and business finances. Most banks require:

EIN
Certificate of Organization
Occasional Operating Agreement.

Apply to Business Credit Card

Helps obtain business credit and cover start up costs.

Get Business Insurance

Common policies:

General liability
Professional liability (E&O)
Workers' compensation
Property/equipment coverage
Commercial auto
Business Owner's Policy (BOP)

Maintain LLC Records

Keep:

Formation documents
Operating Agreement
Vendor contracts
Financial and legal reports.

Annual Reporting

Annual Report: Filed by March 31st annually.
Fee: $80

Good standing also requires that there be a valid registered agent.

Connecticut LLC FAQs

Requirement | Cost

Name Reservation Fee | $60

LLC Registration Fee | $120

Business License Fees | Vary by locality/type

DBA Fee | Varies by town

Annual Report Fee | $80

Use the Connecticut Secretary of State Business Search, or call (860) 509-6002 / email bsd@ct.gov.

File a Certificate of Registration of Trade Name with the town/city clerk where your LLC operates. Fees usually $10–$18; publication may be required.

Pay annual report fee ($80), collect/remit sales tax on goods/services, withhold payroll taxes if employees exist. Corporate election pays Connecticut's 7.5% corporation business tax.

File annual report by March 31 ($80). Maintain a valid registered agent with a Connecticut street address.

Yes, if you are a Connecticut resident, at least 18, with a physical street address available during normal business hours.

No, but recommended to establish ownership rights, resolve disputes, and maintain liability protection.

How to start your LLC in Connecticut