Start Your LLC In
South Carolina with One IBC
Got Questions? Call (949) 524-4399 to talk to a business expert.
Discover the Perfect Plan for Your Company
Basic
$199
Fees for filing legal documents to register or maintain a business.
02 weeks processing
Agent fee
Registered Address
Document filing with the Secretary of State
Standard
$499
Fees for filing legal documents to register or maintain a business.
05 days processing
Includes everything in basic package
Comprehensive name check
Preparation of Articles of Incorporation
Lifetime customer support (phone & email)
Federal Tax ID (EIN) Obtainment Service
Premium
$599
Fees for filing legal documents to register or maintain a business.
01 day processing
Includes everything in standard package
2 hours of free tax consultation
Key Points of South Carolina LLCs
Pass‑Through Default Treatment
By default, a South Carolina LLC is taxed as a pass‑through entity. This means income or losses flow through to the members, who report them on their personal income tax returns.
Optional Entity‑Level Election
Eligible LLCs may elect to have “active trade or business income” taxed at the entity level at a flat 3%. That taxed portion is then excluded from members’ taxable personal income.
Statutory Framework under Uniform LLC Act
South Carolina’s Uniform Limited Liability Company Act governs formation, governance, management structure, and rights of members, offering clear rules and standards for LLC operations.
Understanding South Carolina LLCs
A South Carolina LLC combines the liability protection of a corporation with the tax flexibility of a partnership, making it a compelling choice for business owners seeking simplicity, legal protection, and optional tax strategies. It’s recognized for its pass‑through default, entity‑level election, and solid statutory foundation.
What is a South Carolina LLC?
A South Carolina LLC is a legal entity that shields its members from most personal liability for business obligations. It allows flexible governance—members can choose whether the LLC is member‑managed or manager‑managed.
A South Carolina LLC offers several benefits, including:
Pass‑through taxation by default, optional entity‑level tax for qualified business income, liability protection, and clear statutory rules for operations. LLC owners gain both flexibility and certainty.
Why choose an LLC in South Carolina?
Forming an LLC in South Carolina offers personal asset protection, tax flexibility with the optional entity election, and a relatively straightforward compliance process. The statutory framework provides good clarity, while the possibility to shift tax burdens at the entity level can benefit higher‑earning businesses.
Key Benefits Include:
Tax Flexibility
Liability Protection
Business Credibility
Clear Guidelines
No Double Taxation
Strong Statutory Environment
Pros and Cons of an LLC in South Carolina
Starting a South Carolina LLC: Benefits
A South Carolina LLC protects personal assets from business liabilities, allows flexible management, and supports default pass‑through taxation. The entity‑level election for qualified business income can reduce individual tax burdens. Formation and operational costs are moderate compared to many states.
Taxation of a South Carolina LLC
By default, South Carolina LLCs are taxed by pass‑through—members report their share of profits and losses on their personal tax returns. If the LLC elects the entity‑level tax, only members’ income above that taxed portion is subject to personal income tax. LLCs must also handle sales and use tax if they sell taxable goods or services and employer payroll taxes if they have employees.
Starting a South Carolina LLC: Drawbacks
Making the entity‑level election increases tax complexity and administrative burden. Member and manager data is publicly filed. If taxed as a corporation, the LLC loses pass‑through simplicity and must follow heavier compliance obligations. Some income may not qualify for the 3% election.
Who Can Form an LLC in South Carolina?
Any individual or business entity may form an LLC in South Carolina—including sole proprietors, partnerships, corporations, and foreign businesses wanting to operate in the state. The LLC must file Articles of Organization and designate a registered agent located in South Carolina.
Types of LLCs in South Carolina
Domestic LLC (South Carolina–based LLC)
A domestic LLC is one formed under South Carolina law and operating within the state. It enjoys liability protection and by default pass‑through taxation.
Foreign LLC (Out‑of‑state LLC registering in South Carolina)
A foreign LLC is one formed in another state or country but doing business in South Carolina. It must file for a Certificate of Authority, appoint a South Carolina registered agent, and comply with state tax and reporting obligations.
Professional LLC (PLLC)
South Carolina permits professionals to use the LLC structure, but there is not always a distinct statutory “PLLC” class. Licensed professions must still comply with applicable regulatory board rules if they operate as part of an LLC structure.
How to Start an LLC in South Carolina
Choose a Business Name
Select a unique name that includes "LLC" or "L.L.C." and ensure it’s distinguishable from existing entities in South Carolina. Use the Secretary of State’s name search tool to verify availability.
Appoint a Registered Agent
Designate a registered agent to accept legal documents. This can be an individual or a registered service company with a physical address in South Carolina.
File the Articles of Organization
Submit Form LLC to the South Carolina Secretary of State, providing LLC name, principal office address, and registered agent details.
Create an Operating Agreement
Though not required, it’s recommended to draft an Operating Agreement outlining ownership, governance, and profit distribution to reinforce liability protection and support tax compliance.
South Carolina LLC Application
To form an LLC in South Carolina, file the Articles of Organization with the South Carolina Secretary of State. This formalizes your company’s creation under state law.
Required Information
- LLC name (with “Limited Liability Company,” “LLC,” or similar)
- Registered agent name and physical South Carolina address
- Principal office and mailing addresses
- Organizer’s name and address
- Specification of management structure (member‑managed or manager‑managed)
The Articles of Organization must include:
Filing Options
- Online: Use South Carolina’s Business Entities Online system via the Secretary of State portal.
- By Mail / Paper: Submit the Articles of Organization in paper form to the Secretary of State’s business office.
Filing Fees
- The fee to file the Articles of Organization is $110.
- Operating Agreement: Not filed with the state but strongly recommended to establish internal governance, roles, and financial allocations.
- Annual / Periodic Reports: Most LLCs in South Carolina are not required to file a separate annual report unless they are taxed as corporations.
- Foreign LLCs: Out‑of‑state LLCs must file for a Certificate of Authority, appoint a registered agent in South Carolina, and submit incorporation or formation documents from their home jurisdiction.
Post‑Filing Requirements:
South Carolina LLC Taxation
Pass‑Through Default Treatment
Unless an election is made, income and losses of a South Carolina LLC flow through to members and are taxed on members’ personal state tax returns.
Entity‑Level Election for Active Business Income
Qualified LLCs may choose to have part of their income from active trade/business taxed at the entity level at 3%. That taxed portion is excluded from members’ state tax returns.
Sales, Use & Payroll Taxes
LLCs selling taxable goods or services must collect and remit South Carolina sales tax (6% plus local surtaxes). LLCs with employees must withhold state income tax and pay unemployment insurance, and otherwise comply with state payroll tax rules.
Business Personal Property Tax
An LLC owning business equipment, fixtures, etc., must file a Business Personal Property Tax return in the county where the property is located. That tax is assessed and collected locally based on the value of those assets.
South Carolina LLC Annual Filing (Reports & Returns)
What to File
LLCs treated as corporations must file corporate tax returns and annual reports. For standard LLCs taxed under pass‑through status, there is no separate statewide LLC annual report requirement.
Filing Deadlines
For LLCs taxed as corporations, required reports and returns follow corporate tax deadlines (e.g. by April 15 for calendar year entities). For others, no separate filing deadline exists for annual LLC reports.
Penalties & Consequences
Failure to file required tax returns or corporate reports when applicable may result in penalties, interest charges, and potential loss of good standing or administrative action by the state.
Expanding Your South Carolina LLC
As your business grows, you may want to expand your South Carolina LLC to operate in other states. This section explains how to do that, including how to register your South Carolina LLC as a foreign entity in another state and how out-of-state LLCs can register to operate in South Carolina.
Registering a Foreign LLC in South Carolina
If your LLC was formed in another state but you intend to do business in South Carolina, you must file a Certificate of Authority, appoint a South Carolina registered agent, and provide formation details from your home jurisdiction.
Doing Business in Other States
To expand your South Carolina LLC across state lines, register as a foreign LLC in each state where you operate. That involves filing required foreign entity registrations, appointing local registered agents, submitting Certificates of Good Standing, and complying with each state’s tax, licensing, and regulatory rules.
Find The Right State To
Form An LLC
Every state has different rules, costs, and considerations for LLC formation.
Start Your Business Today
Our Experts are ready to assist!
Doing Business in South Carolina
Frequently Asked Questions
Yes, most states require you to have a registered agent to handle legal documents and notices during business hours.
While not always required by law, having an operating agreement is a smart move to outline your LLC’s rules and avoid disputes down the road.
An EIN is a federal tax ID; most LLCs need one to open a business bank account, file taxes, or hire employees.