Having a Maine LLC is a better and cheaper option than having other business structures. A limited liability company (LLC) reduces the owners’ personal liability and protects their personal assets. One can start an LLC in two ways, domestic LLCs or foreign LLCs (LLCs in more than one state). By following some basic steps, you can easily form an LLC in Maine.
On this page, you’ll learn about the following:
- How to Start an LLC in Maine
- After Starting your Maine LLC
- Maine Foreign LLC
- Why an LLC in Maine
- Top 3 Businesses in Maine
- Maine LLC Formation Review
How to Start an LLC in Maine
An LLC or a Limited Liability Company is a hybrid business entity combining a corporation’s characteristics with a partnership or sole proprietorship. It separates your personal assets from your business assets, thus giving you personal asset protection. This section gives you a step-by-step guide on how to start an LLC in Maine.
Step 1: Decide a Name for Your LLC
Deciding on a business name is the first step to starting an LLC. In Maine, before you name your LLC, it is important to note a few things. Firstly, make sure the name is available to use. If the name is available, then check if the name complies with all the Maine business naming requirements. Once you pass through them, you can successfully name your business.
Why do you need a proper business name?
If you want your LLC to have special identification, your company name is essential. However, many people face many issues by avoiding focusing on choosing a business name for their LLC business formation filings.
Here are some of the major benefits of choosing the best LLC names.
- Helps establish a company’s presence in the market;
- Creates a new identity that will resemble your LLC;
- Allows ease in finishing your LLC registration process;
- You can get the EIN once you have your name registration certificate
Requirements when deciding a name for your LLC
LLC Name Search: A business name search is required to check if the desired name is available or not. If the name is available then the business owner has to fill up a name reservation form and send it to the Secretary of State, Maine. To do the name search, one has to visit the Business Entity Search page on the official Secretary of State website. Send the name reservation form to the below address by mail to reserve your LLC name in Maine. The cost of a name reservation is $20.
Important Quick Links:
Secretary of State
Division of Corporations, UCC and Commissions
101 State House Station
Augusta, ME 04333
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Step 2: Assign a Registered Agent Service in Maine
A registered agent for service is your authorized person or business entity that will act or work on your behalf. This person or business will receive significant tax forms, legal documents, a notice of lawsuits, and other official government correspondence in Maine. Choosing a Maine registered agent for your LLC is required.
Make sure your registered agents are residents of Maine. It could also be a business. Here are the recommended agents:
Note that availing of the services of professional registered agents would be your best option since you are guaranteed that whoever is handling your legal affairs knows their stuff well. You will enjoy peace of mind and focus only on running your business, as the ‘professionals’ take care of all legal matters.
These LLC formation services are recommended registered agent services as they are authorized to conduct business in Maine. Compare them to check the best yet cheapest option for you. Besides, they can guarantee you professional service because they have been in the business for years.
Step 3: File Certificate of Formation in Maine
A Certificate of Name Reservation is needed to file a Certificate of Formation, as other states call it. You need to make reports of this certificate with the Maine Secretary of State, which costs $175. You may file them online or by mail.
This Maine Certificate of Formation is a legal document needed to form your business officially. It will indicate details about your LLC in Maine, like if it is a member-managed or managers-managed. LLCs with employees can check the Maine state government website for the guidelines before they hire employees.
Before you start filing your forms, you must already have your LLC name and registered agents or employees. You will attach a copy of your Name Reservation Certificate along with a list of the services that your Maine LLC will offer.
How to File by Mail
If you prefer filing real-life forms for your Maine LLC registration, then you can download the Maine Limited Company Certificate of Formation. Read the form thoroughly and fill it out. It will have to fill, among others, your name, city, state, zip code, and signature. You may also file in person by visiting the office on business days.
Mail To: Secretary of State
Division of Corporations, UCC and Commissions
101 State House Station
Augusta, ME 04333-0101
Step 4: Create Your Maine LLC Operating Agreement
An operating agreement is a document that legally outlines the proprietorship or partnership and operating procedures of your LLC. This internal document is vital as it ensures that all business owners are on the same page regarding how they operate, thus reducing future conflicts.
When it comes to an LLC operating agreement Maine does not require you to have a comprehensive operating agreement, but it is ideal to have one that contains all your details of business operation. This document would be useful if you decide to dissolve Maine LLC later.
Step 5: Filing a Maine LLC EIN
The Employer Identification Number or, simply, the E.I.N. is a nine-digit number given by the Internal Revenue Service (IRS) to make it easier to identify types of business for tax purposes and taxes in general. It is like a Social Security number dedicated to a business’ taxes. The EIN is necessary for any active business or any form of business for that matter.
EIN is needed when the LLC hires employees. Hiring employees in Maine LLC requires specific rules and regulations. One should know about them before hiring employees. EIN for Maine foreign LLC should be obtained if your LLC is based in other states.
To obtain EIN (aka FEIN) one has to fill up a form (Online or by mail) and submit it to the IRS. Before sending the form, ask for EIN Assistant. Enter details of your LLC, and finally complete the form and send it to the address given.
Mail to: Internal Revenue Service, Attn: EIN Operation, Cincinnati, OH 45999
Fax: (855) 641-6935 | Fee: Free
Note: You don’t need a Social Security number when getting an EIN. You can proceed to fill out I.R.S. Form SS-4 and leave section 7b blank. You must then call the IRS at (267) 941-1099 to complete your application. Agents or employees will help you with that.
And that’s all! Congratulation, you are now done with all the necessary steps to form your Maine LLC. If you still haven’t used a professional service from here, I strongly recommend having one to handle the remaining tasks.
After Starting your Maine LLC
After forming your LLC, there are still some things that you will need. Take note of the following:
- Get a company business bank account
- File Maine business permits & licenses
- Get liability for business and professional liability insurance with coverage for employees
- File a Maine LLC annual report or biennial report
- Already existing LLCs that wish to operate in Maine must register as Maine foreign LLC.
This page has provided you with steps to LLC formation and filing processes. You now have to remember upcoming filing deadlines and filing fees or filing costs, including fees for late filings to make sure your LLC is up-to-date.
Maine Foreign LLC
To register a Maine foreign LLC, one has to file the foreign LLC formation certificate with the Secretary of State, Maine. Forming a foreign LLC allows you to operate your business in more than one state in the USA as a single business entity. Check Maine Foreign LLC to know more about having a foreign LLC.
Why an LLC in Maine
With a GDP of $56.8 billion, Maine has gained large popularity lately. Apart from the growing economy, the state currently has active LLCs in manufacturing industries, art, education, management, and other industries. The state offers diverse business funding options to start-ups. LLCs need to get business licenses to make any business transactions. Also, businesses get a reduction in tax liabilities and other tax benefits in Maine. Read more on Maine’s classification of LLC tax. The main advantages of starting an LLC in this state are as follows,
Creditors can get some silent rights
The first benefit of the LLC in Maine is that all the creditors get some silent rights under section 1573. It means that any creditor who is providing funds to an LLC member will be given interest based on the charging order. The creditor has all the rights to revive, and if in case that creditor doesn’t claim that silent rights, it will be provided to the member.
Formation of LLC is easy
When one is going to Start an LLC in Maine, then they have to file many documents. But in Maine, there is an act under which one doesn’t need to give their partners’ names in the papers. The name of members and the managers is required to be attached to the annual report only.
This way, the LLC member has a person who can file all the forms on behalf of their LLC, and they don’t have to go through hectic procedures. This person can be some legal authority or some other business also.
Duration of the LLC
When an LLC has formed in the Maine state, then the time duration for which that LLC will exist is perpetual. It means that no matter whether the founding member of the LLC is alive or not, the LLC will be registered and keep functioning for a more extended period of time.
Freedom of selection
There is a freedom of selection in the Maine LLC with the help of which one can create the voting and non-voting members. Along with that, they can also customize the members who can contribute to their profits and loss. It will help in setting the LLC on a path of success.
Moreover, when a contract is made, it is allowed for LLCs to make changes in them easily. According to the Government Acts, one can easily make changes in proportion and tailor the risk and profit percentages to a smooth and better management system.
Top 3 Businesses in Maine
Maine is known as one of the best states in terms of providing the best business environment. That is why new entrepreneurs are deciding to form an LLC in Maine. But before you take any further action in your LLC, you should know which state’s most profitable industries are. Also, note the contribution that they have made towards the GDP of Maine. So, here is the list of the best ones.
It is noticed that the contribution of the healthcare sector of Maine to its economy is $10 billion in 2016, which is intended to increase in net years. The healthcare centers, or hospitals, have employed more than 35,000 people, which is roughly 8% of the total population that allows, which makes it one of the largest institutions around the state.
From the 18th century, shipbuilding has started in Maine State and has been a leading producer of wooden ships during World War 1. More than 200 companies in the state build all range of boats and yachts no matter what you require. Moreover, they also make ships for military, commercial purposes like battleships, cruisers, destroyers, etc.
Maine has also become a tourist spot with the beautiful coastlines and American history present in the state. The tourism sector’s contribution to the state GDP is near $10 billion and pays a tax of $600 million to the state. Moreover, other industries like restaurants, agriculture, and fisheries are also supported by tourism as tourists spend money in these sectors, making it a savior of other sectors.
Some small businesses that have flourished well in Maine are:
- Coffee shops
- Dairy and poultry farms
- Hotel online advertisements
Maine LLC Formation Review
Time needed: 5 minutes.
To recap, here are the easy steps again when forming an LLC in Maine. Click on the steps in this list to read the full detail.
- Name your Maine LLC
The first thing you must do is to choose a company name, which should be unique, easy to find, and available in the state.
- Choose a registered agent
In Maine, it is mandatory to select a registered agent for your LLC. You can check out our list of our 5 Best LLC Services in the United States.
- File a formation certificate
Filing a formation certificate is necessary when forming an LLC. Depending on the state, it could be called any of the following: Certificate of Formation, Articles of Organization, or Certificate of Organization.
- Create operating agreement
An operating agreement is not a strict requirement but something encouraged when you start an LLC.
- Get an EIN
The Employer Identification Number (EIN), also called Federal Tax Identification Number, serves to identify a business entity like a social security number but for a company.
How Fast Can I Form an LLC in Maine
If you’re wondering “How fast can I form an LLC in Maine?”, you’re not alone. The question often plagues many small businesses. After all, forming an LLC in Maine is easier than it might sound. Despite this, there are still a few steps you must take before you can actually start operating your company. Here are three of the most important steps to take in order to form an LLC in Maine.
During the process of forming an LLC in Maine, you must designate a registered agent. This person receives all important legal mail and keeps your personal information off of public record. In addition to this, a registered agent will list your business’s address everywhere, which is why it’s important to use a registered agent. You can even sign an operating agreement with a registered agent if you have more than one member.
One of the first steps of LLC formation is to open a business bank account. You must have a separate bank account for your business and your personal accounts. If you commingle your personal and business assets, you may end up with a lawsuit or be accused of being a “sovereign agent” for your business. You should also have an attorney on call in case you run into any legal problems.
The next step is to choose a name for your business. Maine has strict rules regarding business names. Your name must include “limited liability company” (or a combination of both). It must also be unique enough to distinguish it from other businesses in the state. Using a registered agent service will save you time and money. Having a registered agent for your LLC will help you keep your business in good standing.
If you are a resident of Maine, then you can file your LLC by yourself. However, it is always worth having a professional than doing it yourself to handle legal complexities, paperwork, and other documentation.
Apart from the formation fee of $175 (domestic LLC) and $250 (foreign LLC), LLC costs in Maine include $85 for Annual Reports every year. LLCs are liable to pay sales tax of 5.5% every year.
It takes 7 to 10 business days to get a Maine LLC if you file via mail.
Every year all the LLC have to submit an Annual Report and pay $85 to the Maine Secretary of State and renew the LLC. It is mandatory to renew your LLC every year.
Generally, for the LLCs, it is a default tax structure. Once you will obtain the EIN, you will get the various tax structure options to select. Sometimes LLCs choose S Corp to reduce federal tax burdens.
LLCs are easier to establish than other business structures. Small businesses, especially start-ups can easily start their LLC in Maine at a bare minimum cost. An additional fee for expedited service might be needed if you need faster service. Along with limited liability protection, LLCs have a ‘pass-through taxation’ advantage for which they are excluded from certain taxes. The formation of limited liability companies requires much lesser documents and legal processes. Share your queries with us, leave a comment below.