Legal Question in Business Law in Maryland
I just started a Virtual Paralegal Business (sole proprietor) and want to know what do I have to do to convert it to an LLC? I have my EIN number etc. Also approximately what would it cost and how long would it take?
Thanks in advance
2 Answers from Attorneys
You file Articles of Organization with the State Dept. of Assessments and Taxation. Fee is $100. It only takes about 2 weeks or less. If you want an attorney to handle it I typically charge $300 for these services. Your tax number must be one issued to the LLC, so if the EIN you referenced is for some other entity, such as a sole proprietorship, in which case you would just use your ssn, you will need to apply for a new one.
While the state's fee is $100, note that the SDAT can run about a month or more for "standard" filings -- they charge an extra $50 for "rush" service with turn-around in a few days or a week.
Articles of Organization typically involve a one-page document, with very minimal information which becomes a part of the public record. The core organizational document for your new company should be its Operating Agreement. To properly set-up a new LLC, you will want to file Articles, prepare an Operating Agreement, select preferred taxation structure (you have a few options for a LLC), obtain an EIN, set-up state tax, unemployment and other accounts as appropriate and hold an organizational meeting.
My firm offers flat-fee and "ala carte" services for new business start-ups as do other firms these fees will vary from firm to firm. Given the nature of your business -- paralegal services -- you have other practical issues to consider as well.
I worked as a paralegal for several years before and during law school and appreciate the quality work paralegals can perform. However, offering services without attorney supervision must be done with extreme caution -- I encourage you to have an attorney look over your operating agreement, client solicitations and contracts or engagement letter to ensure that you don't venture into unauthorized practice of law territory.
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