This week on 50 States of Incorporation, we take a look at ‘The Palmetto State,’ South Carolina! Also know as ‘The Rice State’ and ‘The Swamp State,’ South Carolina’s official nickname comes from the state tree, the Sabal Palmetto, which distinguished itself during the revolutionary war. It was a fort made of Palmetto logs that repulsed the British fleet from Sullivan’s Island back in 1776! But South Carolina has a lot more to offer than strategically useful flora. Though it was hit hard by the recession, its strong agricultural heritage, and the state’s friendly attitude towards business, has really boosted its recovery. So what should South Carolinian entrepreneurs know about their state? And what does it take to open up a business and incorporate in South Carolina?
Are there any benefits to running a business in South Carolina?
Plenty! South Carolina is actually one of the most business-friendly states in the USA. Thumbtack gave the state an A- in overall friendliness, and South Carolina has the tenth lowest tax burden of all states. It also makes sense to incorporate in South Carolina as the state boasts a low, 5% flat corporate income tax rate. Of course, South Carolina does all it can to help small businesses within the state. The South Carolinian Secretary of State’s office maintains a Small Business One-Stop Site to help new entrepreneurs find and file for everything they need to get their business up and running, and the Department of Commerce is proud to offer multiple growth incentives to businesses with the state.
What do you need to do to start a business in South Carolina?
Like all states, the first thing you’ll need to do business in South Carolina is a Doing Business As name. Anyone selling a product or service using a name other than their own is required to file a DBA name with the state. Depending on what your company does, you may also have to apply for a general business license, or a retail license, and you definitely have to register to pay South Carolina Use Tax. Finally, certain types of business like restaurants, insurance companies, and renovators have to apply for a specialized business permit before opening up their doors.
How do you form an LLC or incorporate in South Carolina?
Before you form a limited liability company in South Carolina, you have to first figure out a name for the business. All LLC’s have to distinguish themselves as such by including ‘Limited Liability Company,’ ‘Limited Company,’ or an abbreviation of one of those two designators in their name. LLCs also need a registered agent and a physical address in the state. Once all of that is taken care you, you fill out your Articles of Organization with the Secretary of State and pay a fee.
Incorporating in South Carolina is a very similar process. You still need a designator in your corporation’s name, like ‘Incorporated,’ or ‘Inc.,’ as well as a registered agent and a physical street address. Once all of that is taken care of, you file your Articles of Incorporation and pay a fee. South Carolina also requires new corporations to file ‘Form CL-1: Initial Annual Report of Corporations’ along with their Articles. Though when you incorporate in South Carolina, remember that you’ll also have to appoint initial corporate directors, hold a board meeting, and elect your bylaws before you start running the corporation in earnest.
Thinking about starting a business in the Palmetto State? Have any questions about what it takes to form an LLC or incorporate in South Carolina? Feel free to give us a call at 1 (877) 692-6772 or leave a comment below!