Module 2: Form the Business

Filing your LLC takes 15-30 minutes and costs $125 in Florida. Here is exactly what to do.

Go to sunbiz.org (Florida Division of Corporations). Click "Start a New Business Filing" and select "Florida Limited Liability Company."

You will need: - LLC name: must include "LLC" or "L.L.C." Check name availability first on Sunbiz. Your name must be distinguishable from every other registered entity in Florida. - Principal address: your physical business address (home office is fine) - Mailing address: can be a P.O. box - Registered agent: name and address of your registered agent in Florida (can be yourself) - Manager/member info: your name and address as managing member - Effective date: you can backdate up to 5 business days or set a future date

The filing fee is $125 via credit card. Processing is immediate for online filings -- you get a confirmation number and your LLC is active within minutes. The official filing document appears in the Sunbiz database within 1-2 business days.

Save your filing confirmation and document number. You will need the document number for SAM.gov registration and bank account opening.

Other states vary in cost and timeline. Delaware is $90 + registered agent fees. Wyoming is $100. California is $70 but adds an $800 annual franchise tax regardless of revenue. Texas is $300. Check your state's Secretary of State website for current fees and forms.

Your Employer Identification Number (EIN) is your business's tax ID. You need it for everything: bank accounts, SAM.gov registration, tax filings, and contract payments.

Go to irs.gov and search "apply for EIN online." The application is free and takes 5 minutes. You get your EIN immediately at the end of the application.

What you will need: - Your Social Security Number (as the responsible party) - Your LLC name exactly as filed with the state - Your LLC formation date - Principal business address - Type of entity: select "Limited Liability Company" - Number of members: 1 for a single-member LLC - Reason for applying: "Started new business"

After completing the application, you get an EIN confirmation letter (CP 575). Save this as a PDF. You cannot get another copy from the IRS website -- if you lose it, you have to call the IRS Business & Specialty Tax Line and wait on hold.

Timing: apply for your EIN after your LLC is officially formed with the state. You need the exact legal name to match. If you apply before filing and the state rejects your name, you have an EIN tied to a non-existent entity.

Important: a single-member LLC is a "disregarded entity" for federal tax purposes. Your business income goes on your personal tax return (Schedule C). The EIN is still required for SAM.gov and banking, but you do not file a separate corporate tax return unless you elect S-Corp or C-Corp taxation.

Florida does not require a written operating agreement for a single-member LLC. Write one anyway. Here is why and what it should contain.

Without an operating agreement, Florida's default LLC statute (Chapter 605) governs your business. The defaults are reasonable but generic. An operating agreement lets you specify terms that matter for government contracting.

Essential clauses for a government contracting LLC:

1. Ownership and control: state that you are the sole member with 100% ownership and full management authority. This matters for set-aside certifications where the SBA verifies ownership and control.

2. Capital contributions: document your initial investment, even if it is $0. "Member contributed $500 as initial capital" creates a clear record.

3. Distribution policy: single-member LLCs can distribute profits at any time without formality. State this explicitly so there is no ambiguity during a DCAA audit.

4. Management authority: state that the member has authority to enter into government contracts, sign proposals, and make all business decisions. This is important for bid/no-bid authority.

5. Fiscal year: use calendar year (January 1 - December 31) unless you have a specific reason not to. Government fiscal year is October 1 - September 30, but your accounting year should be calendar for simplicity.

6. Records retention: state that the LLC will maintain records for a minimum of 6 years (longer than the 3-year default, matching FAR record retention requirements).

7. Dissolution: specify what happens if you want to close the LLC. Important: active government contracts cannot simply be abandoned. The operating agreement should reference orderly wind-down of contract obligations.

Keep the operating agreement to 3-5 pages. Overly complex agreements for a single-member LLC look like someone is trying to obscure the actual ownership structure, which is a red flag for SBA set-aside reviews.

After formation, every state has ongoing compliance requirements. Missing them can result in administrative dissolution of your LLC, which terminates your ability to hold government contracts.

Florida annual requirements: - Annual report: due by May 1 every year. Filed online at sunbiz.org. Fee: $138.75. Late fee: $400. If you miss it entirely, your LLC is administratively dissolved in September. - No state income tax for LLCs (Florida has no personal income tax) - Sales tax: if you sell tangible goods, you need a sales tax certificate from the FL Department of Revenue. Most IT services are exempt, but check your specific service category. - Local business tax receipt: some counties require a local business tax receipt (formerly called an occupational license). Check with your county tax collector.

Calendar of critical dates (Florida example): - January 1: Annual report period opens on Sunbiz - April 15: Federal tax return due (Schedule C with your 1040) - May 1: Florida annual report deadline ($400 late fee after this) - September: Administrative dissolution if annual report not filed

For SAM.gov registration: - Your LLC must be in "Active" status with the state. Verify at sunbiz.org before starting SAM registration. - SAM.gov pulls data from state records. If your state shows "Inactive" or "Dissolved," SAM registration will fail. - SAM.gov registration itself must be renewed annually (separate from state requirements).

Set a calendar reminder for 3 dates: your state annual report deadline, your SAM.gov renewal date, and your federal tax filing deadline. Missing any of these creates cascading problems that take weeks to fix.