You just submitted your Articles of Organization online. Congratulations—your LLC is officially formed!
Now you're a legitimate business owner. You can open a bank account, sign contracts under your company name, and tell everyone you're official.
Except... what actually just happened? What did you create? What are you now required to do? And what are all these terms people keep throwing around: registered agent, operating agreement, EIN, business license, foreign entity registration?
Filing formation documents represents about 20% of actually "forming" a business properly. The other 80% is a web of documentation, registrations, tax setups, compliance requirements, and operational systems.
This article walks through what actually happens when you form your business—and more importantly, what typically happens AFTER that filing goes through.
What Actually Happened When You Filed?
When you submitted your formation documents (Articles of Organization for an LLC, Articles of Incorporation for a Corporation), you:
✓ What You Got:
Created a new legal entity - Your business is now a separate "person" in the eyes of the law. It can own property, sign contracts, sue and be sued, completely separate from you personally.
Registered with your state - Your state now has you on record as an active business entity. They know you exist, and they'll expect annual reports and fees.
Got a filing date - This is your business's "birthday" and affects things like tax year, annual report due dates, and anniversary dates for various filings.
Established your legal name - Your business now has an official name that's registered and (theoretically) protected in your state.
What You DIDN'T Automatically Get:
✗ Tax ID number (EIN) - must apply separately
✗ Business bank account - must open separately
✗ Business licenses or permits - must apply separately
✗ Operating agreement or bylaws - must create separately
✗ Liability protection (not yet, not completely) - must maintain properly
✗ Tax election status - must choose separately
✗ Trademark protection - state filing ≠ trademark rights
The Document You Just Filed (And What It Actually Says)
Basic LLC Articles typically include:
✓ Business name - Your official legal name
✓ Principal address - Where your business operates
✓ Registered agent - Person/company to receive legal documents (required in every state)
✓ Management structure - Member-managed or manager-managed
✓ Organizer information - Who filed the documents
✓ Purpose - Usually generic "any lawful purpose"
What they DON'T include:
- Who owns what percentage
- How decisions get made
- How profits get distributed
- What happens if an owner leaves
- Voting rights
- Day-to-day operations rules
That's all in your operating agreement, which we'll discuss shortly.
The 30 Days After Filing: Common Post-Formation Tasks
Once your formation is approved, many founders begin addressing the following items. Here's what commonly happens:
Week 1: Essential Setup
1. Get Your EIN (Employer Identification Number)
This is your business's Social Security number. It's typically needed to:
- Open a business bank account
- Hire employees
- File business tax returns
- Apply for business licenses
- Apply for business credit
2. Create Your Operating Agreement (LLC) or Bylaws (Corporation)
This is where the real governance of your business lives. Yet many founders either:
- Skip it entirely ("we trust each other")
- Download a template and never read it
- Get it from their formation service and assume it's customized
Why this document is widely considered more important than your Articles:
Operating agreements typically establish ownership percentages, capital contributions, profit/loss allocation, voting rights, management structure, transfer restrictions, buy-sell provisions, deadlock provisions, and dissolution terms.
Co-Founder Scenario Without Operating Agreement
Two founders start 50/50. Six months in, one stops working but won't give up equity. Without an operating agreement with vesting:
- The departed founder keeps 50%
- They can block major decisions
- The remaining founder can't remove them without consent
- Investors typically won't invest with this complicated cap table
What vesting solves: If equity vests over 4 years, the departed founder only keeps the portion they earned (perhaps 12.5% after 6 months), and the rest stays with the company.
3. Open a Business Bank Account
Separate business finances from day one is commonly viewed as essential for maintaining liability protection.
What you'll typically need:
✓ EIN
✓ Articles of Organization/Incorporation
✓ Operating agreement (many banks require this)
✓ Personal identification
Week 2: Compliance and Registrations
4. Research and Obtain Business Licenses and Permits
State formation doesn't automatically authorize business operations. Depending on your business, you may need:
Federal level:
Certain regulated industries (alcohol, firearms, aviation, etc.)
State level:
Professional licenses
Sales tax permit
Industry-specific permits
County level:
General business license
Zoning permits
Health permits
City level:
Business operation permits
Home-based business permits
Signage permits
5. Register for State Taxes
Depending on your state and business type, registration may be needed for:
✓ Sales tax - If selling tangible goods or certain services
✓ Employer withholding tax - If you'll have employees
✓ Unemployment insurance - For employees
✓ Franchise tax - Some states charge annual franchise taxes
6. Consider Foreign Entity Registration
"Foreign" doesn't mean international—it means doing business in a state OTHER than where you formed.
Foreign registration may be needed if:
- You have a physical office in another state
- You have employees working in another state
- You're conducting substantial ongoing business in another state
- You own property in another state
Potential consequences of not registering when required:
- Fines and penalties
- Back taxes
- Inability to sue in that state's courts
- Contracts might be unenforceable
Week 3-4: Operational Setup
7. Set Up Business Banking and Accounting Systems
Beyond just opening an account, many founders establish:
✓ Accounting software - QuickBooks, Xero, FreshBooks
✓ Payment processing - Stripe, Square, PayPal Business
✓ Bookkeeping system - Methods to track income and expenses
✓ Receipt management - Digital system for expense documentation
8. Get Business Insurance
LLC formation doesn't provide complete protection. Many businesses also obtain:
General Liability Insurance - Covers customer injuries, property damage, accidents
Professional Liability / E&O - Covers mistakes in professional services
Property Insurance - Covers business equipment and inventory
Workers Compensation - Required in most states if you have employees
Cyber Liability - If you handle customer data
9. Set Up Payroll (If Needed)
If you'll pay yourself a salary (required for S-Corps, optional for LLCs), or have employees:
✓ Choose payroll service (Gusto, ADP, Paychex)
✓ Register for unemployment insurance
✓ Register for workers comp (if required)
✓ Set up state tax withholding
✓ Establish payroll schedule
✓ Determine classification (employee vs. contractor)
10. Make Tax Elections
Depending on your entity and goals, founders may consider:
S-Corp Election - File Form 2553 (typically must file by March 15 for current year)
83(b) Election - If you receive restricted stock with vesting, file within 30 days
Fiscal Year Election - Most businesses default to calendar year
Continue Reading
Maintaining Your Business & Common Post‑Formation Mistakes - This article explains ongoing compliance requirements and common post‑formation mistakes that founders often overlook after formation.
Learn more about Business Formation for startups.
To ensure you complete every required step, see Registering Your Business: A Step-by-Step Checklist (Free).
Your choice affects what happens after formation — review Should Your Startup Be an LLC or Corporation?
Be sure to avoid common mistakes outlined in 5 Business Structure Mistakes Founders Make.