Rhode Island LLC
Rhode Island LLC
Form a Rhode Island LLC
At LawInc, we keep things simple and allow you to easily form your Rhode Island (RI) Limited Liability Company online or over the phone (800-989-5294).
Rhode Island LLC formation is simple with LawInc.com. Once you submit your application, we check name availability, prepare your Articles of Organization and file your paperwork with the Rhode Island Secretary of State. As soon as your Rhode Island LLC is formed, we forward you your final paperwork.
A Rhode Island LLC can help protect your personal assets, such as your home, car or family savings. In the event of a lawsuit or if your business should fail, your personal assets cannot be touched, assuming you have properly formed, capitalized and maintained your LLC. This limited liability feature of a Rhode Island LLCs is not available in a sole proprietorship or general partnership, where the business owners are personally liable for all business debts.
Let LawInc walk you through the Rhode Island Limited Liability Company formation process. Our clear, concise and easy to use website, helps keep things simple.
Rhode Island LLC Name
The first step in forming a Rhode Island Limited Liability Company (LLC) is selecting the business name. Rhode Island LLC names:
- Must contain the words must contain the words “Limited Liability Company” or the abbreviations “L.L.C.,” or “LLC.”
An available Rhode Island LLC name may be reserved for 120 days.
LawInc.com permits you to choose up to three names and will conduct a name search for your Rhode Island LLC, prior to filing.
Rhode Island LLC Formation
Rhode Island LLC Filing Procedure: When forming a Rhode Island LLC, the Rhode Island Articles of Organization must be filed with the Rhode Island Secretary of State. The Rhode Island Articles of Organization must state:
- The Rhode Island LLC name.
- Name and address of each Rhode Island LLC organizer.
- Street address of Rhode Island registered agent.
- Street address of principle place of business.
Rhode Island LLC Organizers: An Rhode Island limited liability company can be formed by one (1) or more organizers.
Rhode Island LLC Members: Rhode Island LLCs require 1 or more members. There is no residence or age requirement. Rhode Island LLC members are not required to be listed in the Articles of Organization.
Rhode Island LLC Duration: The period of duration of a limited liability company shall be perpetual unless the Rhode Island Articles of Organization place a limitation on the company’s existence or until dissolution or termination.
Rhode Island LLC Purpose: A Rhode Island Limited Liability Company may be formed to transact any or all lawful businesses for which LLCs may be organized under the Law, except the business of banking or insurance.
Rhode Island Registered Agent: An Rhode Island LLC must maintain a registered agent and office to receive service of process in Rhode Island. The Rhode Island registered agent should be available, at an Rhode Island physical address, during normal business hours to accept important legal and tax documents on behalf of the Rhode Island LLC. The registered agent can either be (1) a domestic entity or a foreign entity that is registered to do business in Rhode Island or (2) an individual resident of the state. A Rhode Island LLC may not act as its own agent.
Rhode Island LLC Operating Agreement: After filing, it is highly advised that an operating agreement is drafted which dictates the LLC internal affairs and management. There is no set criteria, but an Rhode Island LLC operating agreement should reference how the Rhode Island LLC is managed, allocation of profits and losses and member capital contributions. The Rhode Island LLC operating agreement does not need to be filed.
Rhode Island LLC Post-Filing Requirements
Rhode Island LLC Annual Report: Rhode Island LLCs are required to file Annual Reports. RI decennial reports are due on November 1st of each year. The filing fee is $50. The Rhode Island Annual Report is mailed to the Rhode Island registered agent approximately 3-4 weeks prior to the filing time. To file online, visit: http://sos.ri.gov/business/filings.
Rhode Island LLC Taxes
Rhode Island State Income Tax: The LLC tax rate for Rhode Island is variable, depending on Rhode Island taxable net income.
Federal Income Tax: An advantage of the LLC is its tax flexibility. LLC members are allowed to select how the entity will be taxed. An LLC may be classified for federal income tax purposes as either a:
- Sole proprietorship
- Partnership, or
Single member LLCs are treated the same as sole proprietorships. Profits are reported on Schedule C as part of your individual 1040 tax return. Self-employment taxes on Rhode Island LLC net income must be paid just as you would with any self-employment business.
Most Rhode Island multi-member LLCs elect to be treated as partnerships by the IRS and file IRS Form 1065. On this form, Rhode Island LLC profits are reported and allocated to each of the owners according to the Rhode Island LLC’s operating agreement. Each owner is given a Schedule K-1, which shows each owner’s share of LLC income or loss. The owner then reports and pays taxes on this income on the owner’s annual 1040 income tax return. It is important to note that as with sole proprietorships, all Rhode Island LLC profits are taxed to the owners, even if they are not actually distributed by the LLC. This situation can arise when the LLC needs to use its profits to pay ongoing expenses.
If pass-through taxation is not desired, an LLC may elect to be taxed as a corporation by completing IRS Form 8832. If this election is made, the LLC is taxed as a C corporation by the federal government. Because the corporate income tax rates for the first $75,000 of corporate taxable income are lower than the individual income tax rates that apply to the taxable income of non-corporate taxpayers, it is possible a net income tax savings can result from this tax election. Additionally, an LLC can be taxed like an S corporation by filing IRS Form 2553.
Federal Tax Identification Number/Employer Identification Number (EIN): The Federal Tax Identification Number, also known as the Employer Identification Number (EIN) is a number that is assigned to a business by the Internal Revenue Service. An EIN is like a Social Security Number for a business. It is a requisite for certain business functions such as opening bank accounts or hiring employees. An EIN is typically required if the Rhode Island LLC has more than one owner or any employees.
Rhode Island LLC Dissolution/Cancellation
Rhode Island LLC Dissolution/Cancellation: In order to dissolve or cancel an Rhode Island LLC, the members or managers must file Articles of Dissolution with the Rhode Island Secretary of State.
Acts Triggering Rhode Island LLC Dissolution: A Rhode Island LLC can be dissolved upon the happening of one of the following:
- At a time specified in the Articles of Organization or operating agreement;
- Upon occurrence of events specified in the Articles of Organization or operating agreement;
- Consent by the specific number or percentage of members indicated in the operating agreement;
- At any time there are no members; or
- Judicial decree to dissolve by a Court.