South Carolina offers entrepreneurs a business-friendly environment to form and operate a Limited Liability Company (LLC). Combining the personal liability protection of a corporation with the flexibility of a partnership, an LLC is a popular choice for small businesses. This guide outlines the key steps and requirements for forming and maintaining an LLC in South Carolina.

The first step in forming a South Carolina LLC is selecting a unique and legally compliant name. The name must:

1. Include the words “Limited Liability Company,” “L.L.C.,” or “LLC.”
2. Be distinguishable from existing business names registered with the South Carolina Secretary of State.

Conducting a name search on the Secretary of State’s online database ensures your desired name is available. However, the Secretary of State does not verify whether the name infringes on federally registered trademarks. Entrepreneurs should perform a comprehensive trademark search to avoid potential disputes. Twisdale Law, PC can assist clients with performing a trademark search.

To officially form your LLC, you must file Articles of Organization with the South Carolina Secretary of State. This document requires:

1. The full legal name of the LLC.
2. The address of the office in South Carolina for the LLC.
3. The name and address of the Agent for Service of Process (commonly referred to as a Registered Agent in other states).
4. The name and address of an Organizer (the individual executing the Articles of Organization).
5. Identification of whether the LLC is a term company (intended for a finite duration).
6. Identification of whether the LLC is manager-managed, and if so, the names of the managers.
7. Information about the LLC’s primary office.

South Carolina allows for online or mail filing. The filing fee is $110, and online filings are typically processed faster.

Every LLC in South Carolina must designate an Agent for Service of Process (or Registered Agent) to receive legal notices, service of process, and other official communications. The Agent must:

1. Be a South Carolina resident or a business entity authorized to operate in the state.
2. Have a physical address (not a P.O. Box) in South Carolina.

Twisdale Law, PC offers professional Agent for Service of Process services to ensure compliance and reliability.

While not legally required in South Carolina, an Operating Agreement is highly recommended. This internal document outlines:

1. The roles and responsibilities of Members (owners).
2. Voting rights and decision-making processes.
3. Profit and loss distribution.
4. Procedures for adding or removing Members.
5. Dissolution guidelines.

The flexibility of an LLC is both its strength and potential weakness. South Carolina’s statutory framework for LLCs is relatively minimal. Without an Operating Agreement, Members may face costly litigation or undesirable outcomes in disputes. Drafting a comprehensive Operating Agreement can prevent such issues and provide clear guidance for Members.

Unlike many states, South Carolina does not require LLCs to file annual reports with the Secretary of State. However, LLCs are still responsible for paying taxes to the state. Depending on the LLC’s activities, taxes may include:

1. Income tax for Members (in the case of pass-through taxation).
2. Employer withholding tax (if the LLC has employees).
3. Sales and use tax (if applicable to business activities).

Consulting a tax professional ensures compliance with all state and federal tax obligations.

Forming and operating an LLC in South Carolina is a relatively straightforward process, but attention to detail is essential to ensure compliance and avoid legal pitfalls. From choosing a unique name and filing the Articles of Organization to drafting an Operating Agreement and fulfilling tax obligations, each step is integral to the success of your LLC.

By seeking professional guidance, such as the services offered by Twisdale Law, PC, entrepreneurs can navigate the complexities of LLC formation and focus on growing their businesses with confidence.