Benefits of an LLC in Florida

Low-Cost (Affordable) LLC Filing Fees

Florida doesn’t charge a bunch of different fees to start your LLC. The only required fees are to submit your Articles of Organization and to designate your LLC’s registered agent. Everything else at start-up is optional, so you only have to pay $125 to get started. It’s not the cheapest state, but overall, Florida makes it pretty affordable; filing with ZenBusiness keeps your LLC filing cheap, too.

After that, there aren’t a bunch of annual fees to budget for. The Florida annual report only costs $138.75, and many other miscellaneous Florida filings cost just $25.

Annual Report Late Fees

Florida is pretty mild with their annual report fee, but don’t be caught with a late report! Florida charges a hefty late fee for reports that are submitted after May 1st. The fee jumps to a hefty $538.75. Filing on time keeps your ongoing costs low. Our annual report service can help ensure you don’t miss this expensive deadline.

Tax Benefits of an LLC in Florida

From a tax perspective, Florida is a great place to operate a limited liability company. That’s because, by default, an LLC has pass-through taxation. The LLC itself doesn’t file and pay taxes; the tax responsibilities “pass through” to the members, who file and pay income taxes on their personal tax returns. And since Florida doesn’t charge personal income taxes, that only happens on the federal level. 

Even on the federal level, this structure avoids the “double taxation” of a corporation, where the corporation pays corporate taxes before making distributions, and then the shareholders pay personal taxes when they receive their distributions. That said, in some cases, a larger Florida LLC might elect to be taxed as a C corporation or S corporation. The real luxury is that you have the option to choose which structure works best for your unique business.

Miscellaneous Taxes

While you might not have to pay state income taxes on your LLC’s profits, there’s a good chance your LLC will incur other tax liabilities. For example, you might have to collect and pay sales taxes, and you’ll want to account for federal self-employment taxes. Generally speaking, though, these taxes are relatively manageable as long as you plan ahead for them.

We highly recommend consulting with a business attorney or licensed accountant to discuss your business taxes.

Florida LLC Asset Protection

One of the biggest benefits of a Florida LLC is limited liability protection. If you operated as an unregistered business — like a sole proprietorship or partnership — your business would be legally indistinguishable from you as a person. But an LLC is a separate legal entity from its members. And as a result, the LLC has a corporate veil.

In most cases, the LLC’s creditors can only seize business assets from the LLC in the event of a lawsuit. They can’t come after the assets of the members. These legal protections are one of the primary reasons entrepreneurs decide they need an LLC. That said, if the members don’t operate the LLC compliantly and legally, a court can rule to pierce the corporate veil.

A Note on Single-Member LLCs

In the past, Florida courts have ruled unfavorably towards single-member LLCs (LLCs with just one owner). In some contexts, single-member LLCs have been treated like sole proprietorships, with minimal personal asset protections. As a result, many Florida business attorneys caution against forming a single-member LLC.

However, if you operate a perfectly compliant Florida LLC, you’re much less likely to encounter one of these issues. If you want a much more secure business entity type, you might consider a Florida corporation instead. Some LLCs opt to give a nominal membership interest (5-10%) to a second member to solidify their personal liability protections by being a multi-member LLC instead.

Business-Friendly Environment

Florida fosters a business-friendly environment with minimal filing fees and easy maintenance. For example, the state lets you file your annual report anytime between January 1 and May 1. That generous window gives you plenty of time.

Easy state requirements aren’t the only thing that makes Florida a great place to start a business. The state itself is its own resource. With its desirable tourist destinations, temperate climate, and proximity to major airports and ports, Florida is a great place for entrepreneurs to thrive.

Access to Capital and Resources in Florida

If you’re looking for a little extra cash to fund your start-up, odds are you’ll find it. Florida’s Department of Economic Opportunity helps small businesses and minority businesses get the help they need. There’s a wealth of programs: the State Small Business Credit Initiative, the Microfinance Guarantee Program, Prospera, the Florida Small Business Emergency Bridge Loan — the list goes on.

For example, at the beginning of 2023, Florida’s Small Business Credit Initiative announced that $142 million in capital had been acquired for small business use. It’s currently available for any Florida-based business with 750 employees or less. And that’s just one of the many resources available to you.