When starting a business, entrepreneurs consider forming a Wyoming LLC for various reasons such as ease of creating, low fees, and high levels of privacy.
Wyoming’s economic environment has no personal or corporate income tax, great management options, and is not biased against business owners. This explains the growth of many entrepreneurs creating Limited Liability Companies (LLCs).
Aside from creating the LLC, however, the complaint is the other aspect of the business that is required regularly to keep the business in good standing and avoid the risk of fines or legal troubles, among other issues.
Setting up a Wyoming LLC is one thing ensuring that there are compliance obligations that are necessary to ensure doing business is another, but they do not have to be complicated, all that is needed is a strategy addressing what areas need to be covered.
This post intends to help by providing information concerning compliance after Wyoming LLC formation. This will assist in building the business and avoiding the risks of being out of business in the future.
1. File the Wyoming Annual Report
Every year, LLCs registered in Wyoming are required to write to the Secretary of State. Missing this deadline could significantly impact your business. Let’s assume that the LLC was established on July 15, which would mean on August 1, 2021, the first report is expected to be sent.
Key Details:
✅ Fee: In an annual report, one has to fill in a fee that varies from $50 to 0.0002 times the worth of an individual’s asset.
✅ Filing Method: One can apply to the Secretary of State’s website while sitting in the comfort of their home or office. Just make sure to have all the necessary details such as the LLC’s Wyoming asset value in case you don’t want the filing to be incomplete and, hence unsuccessful.
✅ Penalty for Non-Compliance: If an investor fails to deliver the annual report, this can lead to the administrative dissolution of an LLC.
2. Maintain a Registered Agent
Every LLC that has registered with the state is required to have a physical address where the registered agent will be stationed. The registered agent is in charge of receiving all successful corporate papers from the government on behalf of the LLC.
Key Points:
- Make sure to update your registered agent’s information. If you don’t receive correspondence from the state due to your registered agent not having the correspondence, chances are you are non-compliant.
- Whenever there is a change whereby there is a new registered agent, then an amendment should be submitted to the Secretary of State regarding that change.
- If you are in Wyoming, you are legally allowed to be your registered agent. However, it is preferable to hire a professional service so as to not miss crucial documents as they have a profession of ensuring documents are received.
3. Pay Applicable Taxes
Even though you can think about how Wisconsin has no income tax, your LLC activities can still be liable for federal taxes and local taxes which Wisconsin may have.
Common Tax Requirements:
✅ Federal Taxes: It’s mandatory to remit Federal Taxes to the Internal Revenue Service for the earnings of your LLC. A sole member LLC reports the profits in their personal tax form which contains schedule C. Exhaustive LLC members use form 1065 and complete a partnership return where K-1 is used for other members.
✅ Sales Tax: If your LLC is selling taxable goods and services then make sure to collect and pay sales tax. One can do it through the Department of Revenue in Wyoming while registering a sales tax license.
✅ Employer Taxes: Unemployment or Worker’s compensation along with employer taxes, have to be registered by all the business owners who have employees in their LLCs. Paycheck withholdings have to be done by the laws set out by the states and the federal authorities.
4. Keep Accurate Records
To comply with the laws and protect the limited liability of your LLC, maintaining records that are accurate as well as up-to-date is essential. Any potential litigation or audit can also be handled efficiently with correct documentation.
Essential Records to Maintain:
✅ Operating Agreement: This is an internal memorandum detailing the members of the LLC and how the LLC will be run.
✅ Minutes of Meetings: Although not mandated in Wyoming, minutes of meetings might help prove the good governance of the LLC.
✅ Financial Records: All bank statements, P&L statements, balance sheets, and tax returns should be kept.
✅ Filed Documents: Articles of Organizations, annual reports, and amendments of the documents submitted to the state.
5. Renew Business Licenses and Permits
Based on the activities that your LLC intends to execute, some permits would be needed to operate in Wyoming. The acquired permits cease to be operational if they are not renewed over time.
Steps to Stay Compliant:
- Investigate the necessary permits that are needed for your sector and geographical area. Construction businesses, medical practitioners, and food services for instance may require more permits.
- Maintaining the deadlines and the fees for the renewal of such licenses and permits to carry on with the business without interruption.
- Make it a point to provide the necessary documentation while renewing licenses.
6. Stay Updated on State Laws
As the time passes, the business laws of Wyoming might change. Knowing the current laws can help in shaping your business to avoid any unintentional noncompliance.
How to Stay Informed:
- Read newsletters or updates from the Secretary of State for Wyoming and other state agencies.
- Go for workshops, webinars, and similar activities for notifications on regulatory matters.
- Reach out to a business lawyer or compliance expert to help you understand new regulations and how they affect your LLC.
7. Maintain Business Insurance
It is not mandatory but it is prudent to have good business insurance in place to mitigate risks and liabilities that your LLC may encounter. It is also good for business as it builds trust with your clients and partners.
Common Types of Insurance:
✅ General Liability Insurance: This takes care of the most common risks in any form, including damage to property and injury to persons.
✅ Professional Liability Insurance: A must for all service businesses, this cover protects the firm against being sued for mistakes and negligence.
✅ Workers’ Compensation Insurance: This is important if your LLC has workers. It covers injuries and diseases contracted while in the employees’ workplace.
8. Update Your Information with the Secretary of State
If there are alterations in the name of your LLC, the registered agent, or the address of the business, it becomes essential to submit the necessary amendment forms to the Wyoming Secretary of State.
Important Notes:
- Make the changes without delay to keep the state’s records valid.
- There might be expenses associated with the amendment submission; such risks should be allocated appropriately.
- Making the changes in time ensures that there are no interruptions in the delivery of necessary official business correspondence and/or service of process notification.
9. Conduct Periodic Internal Reviews
Periodic management of a number of compliance aspects of your LLC allows you to resolve potential threats before they develop into serious problems.
Checklist for Internal Reviews:
- Check whether such annual reports and the like have been filed with the state and are remaining active.
- Check the figures in the financial reports for accuracy and completeness.
- Make sure that there is a separation between personal and company funds in order to maintain the principle of limited liability.
- Check that all taxes due have been filed and claimed where appropriate.
10. Engage Professional Assistance
It is more often than not characterized by a bewildering array of compliance requirements that seem to never end, especially in the case of LLCs. Professional services can provide effective means of ensuring that all obligations are fulfilled.
Types of Professional Help:
✅ Accountants: It is common for them to handle areas like tax filing, tax planning, and bookkeeping.
✅ Registered Agent Services: Timely receipt and processing of the company’s documents.
✅ Business Attorneys: Advise on regulatory issues, compliance issues, signing contracts, and resolving most of the disputes.
Conclusion
Complying with the legal requirements for your Wyoming LLC is a matter of having an organized and proactive approach, as well as being well-informed.
The responsibility of filing annual returns, paying necessary taxes, maintaining proper books, and being in compliance with the requirements for licensing are ways in which you can maintain your LLC in good standing.
The regulatory requirements may be onerous, but the prospects offered by Wyoming’s economy are attractive, and compliance requirements open the door for such opportunities.
When in doubt, It is easy to obtain assistance from a professional service like EasyFiling that would resolve any confusion about any specific requirement. Being compliant not only safeguards your company but also puts it in a position for favorable performance in the future.
Nabin Adhikari
