So I used one of those online formation services to set up my LLC last month. I was under the impression they'd handle all the permits and licenses I need to actually operate. Turns out that's not the case at all. Now I'm getting notices about missing local permits. Did I misread their marketing or is this just how it works? Feeling a bit dumb here.
LLC Formation
I thought the formation service handled permits after registration
Yeah, those services only file your articles of organization. Permits are a separate beast. They usually offer a 'registered agent' and maybe a business license 'guide' but not the actual permits. You're not dumb, just got caught by the upsell.
I think it depends on the service. Some do offer a 'cOmplete' package that includes federal EIN and state tax registration, but local city/county permits? Almost never. They can't know every local regulation.
That's the thing – their site said 'we handle the paperwork so you can focus on your business.' I guess I read 'paperwork' as everything.
Lol welcome to small business ownership. Next you'll find out the the IRS isn't a fan of 'I thought my accountant had that.'
Which service? I used Incfile and they were pretty clear that permits were separate. But I've heard others are sketchy with their wording.
Honestly, the compliance notices can be a blessing. At least they tell you what you're missing. Better than getting fined six months down the line
It was ZenBusiness. And yeah, I'm glad I'm finding out now. Just frustrating. I'm going to call my city's business office tomorrow and see what they actually need from me.
Good call. Also check if your state has a small business development cEnter – they can help navigate permits for free.
SBDC is legit. Used them when I opened my coffee shop. Saved me from a $500 fine over a sign permit I didn't know about.
Wait until you learn about annual reports. Those formation services will 'remind' you but then charge a fee to file it. Learn to do it yourself.
Yeah, I set a calendar reminder for my annual report and just do it on the state website. Takes 10 minutes. Don't pay the extra $100.
This thread is basically a masterclass in hidden small business costs. Good luck, OP.
Thanks all. I'll report back if the city office is as helpful as you say. Or if I get fined. Either way, lesson learned.