Basic question on forming LLC and obtaining a business account.

**robousy** · 03-05-2009 01:18 PM

Hey folks,

I am about to use nolo.com to form an LLC in Texas.

The fees add up in total (including state filing fees) to just over $400.

I've never done this before and I guess I'm just looking to make sure I'm not doing anything stupid. My questions are:

1. Does this cost sound about right?
2. Once I have done this, will it be straightforward to open a business bank account.

Thanks in advance.

R

**Gene** · 03-05-2009 02:40 PM

Hey there!

The cost sounds about right....I've talked to a lawyer and he told me about $500.

However I seem to remember places online where you can do it for much less. Have you searched around any?

**RLorenzen** · 03-05-2009 03:18 PM

The cost depends on which services you want to utilize during the registration process (it also depends on the state you file in). Most companies offer a bunch of add-on services such as filing to get your EIN, quarterly tax reminders, etc. Pick out the services you need (in addition to the standard filing) and pay what the cost is.

When you go to open your bank account the bank will ask for several things. Now, this may vary between banks so go to your bank's website and double check.
1. Business license and EIN
2. I.D. for all signers
3. Second piece of I.D. for each signer
4. SSN for all signers
5. All signers must be present when opening the account

**BusinessAdviser** · 03-05-2009 04:40 PM

Originally Posted by RLorenzen

The cost depends on which services you want to utilize during the registration process (it also depends on the state you file in). Most companies offer a bunch of add-on services such as filing to get your EIN, quarterly tax reminders, etc. Pick out the services you need (in addition to the standard filing) and pay what the cost is.

When you go to open your bank account the bank will ask for several things. Now, this may vary between banks so go to your bank's website and double check.
1. Business license and EIN
2. I.D. for all signers
3. Second piece of I.D. for each signer
4. SSN for all signers
5. All signers must be present when opening the account

You'll need your operating agreement too.

**RLorenzen** · 03-05-2009 04:45 PM

Originally Posted by BusinessAdviser

You'll need your operating agreement too.

He didn't ask about an operating agreement, Jonathan. But I appreciate your concern.

**robousy** · 03-05-2009 05:13 PM

Thanks for the guidance folks.

I filed today with startbizhere.com who were the cheapest by far. $300 state filing fee + $35 taken by startbizhere.

First business formed!

I'm looking up how to write an operating agreement right now. I'm sure it won't be too hard as I am the sole owner of the business. ehow has an article.

Thanks for the advice so far.

**RLorenzen** · 03-05-2009 05:39 PM

Originally Posted by BusinessAdviser

Yes, he did, in a sense, since he asked what he needed to open a banking account. To open it in the name of the LLC, and thus achieve the limited liability protection, he'll need an operating agreement.

But I appreciate YOUR concern, Richard (whatever the hell that gay comment means).

The bank doesn't ask to see an operating agreement; thus, it isn't required to open a bank account. In the event of a lawsuit or anything like that will the business owners need an operating agreement to prove their limited liability? Perhaps, but that goes way beyond the scope of the original question which was what did he need in order to open a bank account. Stop complicating things.

**robousy** · 03-05-2009 08:56 PM

uh oh...don't start a war on behalf of my ignorant phrasing guys.

The op agreement comment was useful as I am a complete noob in the realms of business so any and all knowledge is good for me. Your list was valuable too RLorenzen.

I am the sole owner so I'm not sure how important the OA is - but I plan to read some more tonight.

Cheers guys.

**horsenaround** · 03-05-2009 09:57 PM

robousy,

Good luck with your new venture. Don't feel too bad about being a "noob". Remember the only stupid question is the one that's not asked.

BTW-In my experience dealing with banks in CA...you do need an Operating Agreement to open a business account. It can be as simple or as complicated as your heart desires but just stick to the basics that is probably found on the site you are exploring tonight.

What is your business?

Frank

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**robousy** · 03-05-2009 10:08 PM

Originally Posted by horsenaround

robousy,

Good luck with your new venture. Don't feel too bad about being a "noob". Remember the only stupid question is the one that's not asked.

What is your business?

Frank

Thats funny, I used to tell my students that exact same thing...the only stupid question is the one that's not asked. Glad someone else has that same philosophy.

It's nothing spectacular. Simply <myname> Consulting LLC. I'm starting to pick up odd contracts here and there after finishing grad school and for tax purposes the people who are contracting me want to work with a business rather than an individual. Makes sense.

Cheers.

Rich

**horsenaround** · 03-05-2009 10:30 PM

Good Luck With The Consult Biz!

Suggestion-Don't call it "Noob Consulting LLC"- HAHA

Cheers and Beers,

Frank

www.RaceHorseDreams.com - Welcome

**BusinessAdviser** · 03-05-2009 10:46 PM

Originally Posted by RLorenzen

The bank doesn't ask to see an operating agreement; thus, it isn't required to open a bank account. In the event of a lawsuit or anything like that will the business owners need an operating agreement to prove their limited liability? Perhaps, but that goes way beyond the scope of the original question which was what did he need in order to open a bank account. Stop complicating things.

As Horse said, ACTUALLY most banks DO require an operating agreement in order to open an account in the name of an LLC.

**robousy** · 03-06-2009 11:02 AM

...ok so another nooob question - but what role does the 'article of organization' play in all of this.

I seem to recall bank of america saying this was something additional they required and it likes like this costs another several hundred dollars.

**horsenaround** · 03-06-2009 11:10 AM

robousy,

I'm sure all States are different, but in CA you must complete an Articles Of Organization to form an LLC. The cost here is $70.00 and it is a simple form which can be downloaded from the Sec. of State website. You will also need an EIN which can be set up through the process.

Frank

www.RaceHorseDreams.com - Welcome

**robousy** · 03-06-2009 11:49 AM

Hey thanks Frank,

Does this form need to be submitted and do you then have to wait for some kind of acceptance?? I read something about 4 to 6 weeks being the timeframe for this.

Rich