Ongoing Developments - 02/02/07
I am really anxious to open up a bank account in LLC’s name so I could deposit initial capital, from at least me and another partner (10K total). I am in a rush, because I have to pay off my ad posting fees for the LLC formation notices, and it’s about 2K total. I definitely want to write that off as a business expense, so I don’t want to do this from my own bank account.
On Monday, the 29th, I started filling out the LLC Filing Fee Payment Form (since it was due by Jan monthend). Since I’ve done no business through the LLC in 2006 (it was only formed Dec 7th and I had no time to work on it at all that month), the completion of this form was pretty simple. Since I’m claiming no income or loss from New York sources for the year, I am exempt from the $500 filing fee and have to only fill out my company information and sign the form. However, this is a little tricky, because it asks for your tax ID number, so you have to apply for EIN (Employer ID Number) first.
For that, you go here and submit it online. You get your tax ID as soon as you hit submit, provided you fill it out properly. This form is pretty straight forward as well. It does ask you some questions that require a bit of though (nature of your business, how many employees you are expecting to hire in the next 12 months, type of entity you are applying for - partnership, for most LLCs). I would highly recommend that you read through the instructions for both SS-4 and the state LLC filing fee form to make sure you answer everything correction. They are relatively short and easy to get through. The one tricky part on SS-4 is on the bottom, where it asks for name and title. Don’t try to make up a fancy title here (CEO, Founder, Chief Magistrate, etc) - it’s supposed to be “your name, LLC member”.
Anyway, so once I submitted the SS-4 and got my Tax ID, I filled out the rest of the State LLC form and mailed it in. Immediate needs taken care of, I went to a local Citibank branch (simply because I already have an account with them) and asked for details on opening up a business account. They gave me around 10 pages of forms to fill out that include some pretty detailed questions, such as the amount of deposits/withdrawals I will be doing, number of partners, projected revenue, etc. I’m planning to sit down this weekend and carefully go through the docs - will post an update on what they ask once I get more familiar with it. Besides the forms, I need to provide an ID (license or passport is fine) for every member (you can submit photocopies if you can’t get all the members together to come down) and have every member fill out a one page membership/signature form. These have to be originals, so you can’t have people just fax them to you. I’m not seeing my friend till next week, so I’ll probably ask him to mail it to me, might be faster.
In other news, I went to a Google open-house / recruiting event last night. It was the most fun recruiting event I’ve been to, at least compared to stuffy Wall St recruiting. Everyone was really friendly, laid-back, and in love with Google and everything Internet. I found out a lot about the company (and yes, they are planning to take over the world) and got a chance to meet some competition. There was a number of founders and enterpreneurs among the atendees. I met the founder of www.ModelsHotel.com, for instance. Another social network. However, he saw the opportunity much earlier than me, as he started in Feb 2006 and went live in September. In the past 4 months, he’s expanded to six people and has revenues of about $6K/month, from ads. Not exactly the next Microsoft, but it goes to show that the concept does bring in money, at least. However, he did start with $150K in initial capital that he got from an angel investor. So compared to my 20K startup capital goal, that seems like a lot of cash. But then again, I’m only hiring college kids, so who knows…
