A Detailed Guide to Business Addresses for LLCs
An entrepreneur may choose to register their business as an LLC when they’re ready to take the next step as a company. An LLC opens up opportunities for businesses to grow and gain credibility with customers and investors while shielding financial and legal liability.
Establishing an LLC requires completing paperwork, which requires a business address. Many entrepreneurs misunderstand and underutilize the connection between a business address and an LLC.
This guide answers common questions when deciding on a business address for LLCs and what kind of business address would best suit your company.
What Is a Business Address?
A business address is any form of address used for business documentation or receiving mail. This can be a physical location, such as a storefront or office. It can also be a virtual address or even a PO box.
What Is an LLC?
A limited liability company, or LLC, is a business structure meant to minimize the legal liability a business owner faces. An owner of the LLC is also known as a “member” in this structure. This business formation is appealing to entrepreneurs because it separates personal assets from business assets.
It’s important to note that an LLC is not a corporation, though the two are often mistaken. Corporations have more regulations to follow than LLCs.
The Purpose of LLCs
The purpose of an LLC is to minimize the business owner's personal liability. A part of that is separating personal assets from professional assets, as mentioned, preventing the owner’s vehicle, home, personal bank account contents, and other personal assets from being seized to repay business debts.
Forming an LLC can also offer tax benefits, allowing the profits of the business to be taxed as personal income. This advantage prevents an entrepreneur from being taxed as both a business and as an individual.
What Are the Pros and Cons of Registering as an LLC?
You should evaluate both pros and cons when considering registering your business as an LLC.
Pros of LLCs
Some of the advantages of LLCs for entrepreneurs include:
Fewer requirements compared to a corporation
Flexibility in how the business is run
Intellectual property protection
Cons of LLCs
Drawbacks of forming LLCs that business owners should be aware of are:
Difficult to transfer ownership
It costs more to form and maintain than some corporations
Investors may prefer corporations over LLCs
Limited lifespan (not future-proof)
Need to file annual reports
Restrictions that change by state
DBA vs. LLC
“Doing business as,” also known as DBA, refers to a business name that’s different from its legal name. It can also be called a trade name or an assumed name. But a DBA doesn’t offer any legal protection—it only adds another layer of anonymity for the business and its owner.
Any type of business can have a DBA. You can register a company as an LLC and use a DBA at the same time without affecting any aspect of your business standing.
Should you choose to register your company with a DBA, the process is more straightforward than registering the business as an LLC. The primary requirement is a registration fee, and some areas require regular DBA renewals.
What Company Owners Need to Know About Business Addresses for LLCs
We’ve compiled a list of questions addressing what every company owner needs to know about using a business address for an LLC.
Do I Need a Business Address for an LLC?
You don’t technically need a business address for an LLC, but you do need a secure physical location where you can receive mail. Under this definition, you could use a residential address as your LLC address, regardless of whether you run the business there. However, a separate business address looks more professional than a residential address.
Establishing a separate business address for your LLC can also protect you, preventing people from knowing where you live. This example is just one of the benefits of a business address.
How Do I Get a Business Address for an LLC?
You can easily get a business address for an LLC because of the various choices available. In addition to using your home address, you can use:
Coworking space address
USPS street address
Once you’ve chosen the address you want to use, you can locate a provider of that type of address. For example, you can contact Davinci if you’re interested in using a virtual address.
How Do I Avoid Using a Home Address for an LLC?
You can avoid using your home address as an LLC by taking advantage of other options, such as virtual addresses, coworking spaces, and USPS street addresses.
Business owners should avoid using their home address as their business address for a variety of reasons, including:
Privacy: The address you register your LLC at will become public, allowing anyone to look it up and know where you live.
Credibility: Having a residential address as your business address could convey an unprofessional image to potential customers, investors, and partners.
Zoning laws: Depending on where you live, laws may restrict registering your home address as an LLC.
Can I Use a Virtual Address for My LLC?
Yes, you can use a virtual address for your LLC. In fact, using a virtual address for your LLC may be one of the best decisions you can make as a business owner. This is because, depending on the provider, you can have your virtual address anywhere.
As you choose your virtual address, you can opt to be neighbors with already established companies, creating a better reputation for your business through proximity. Also, many virtual address providers offer additional services that can help streamline operations for your business.
Can I Set Up an LLC in Another State?
You can set up an LLC in another state, but the process will differ slightly from registering within your home state. Registering an LLC in your home state is a domestic or in-state entity. When you choose to register an LLC outside of your home state, it’s known as a foreign or out-of-state entity.
To set up an LLC in another state, you need a registered agent designated to manage correspondence on behalf of your business in that state. Each state has different standards and requirements for registering an LLC. Some states require completing extra paperwork, while others may require proof of your business’s good standing.
There may also be various registration fees involved in creating a foreign entity.
What Is the Best State to Set Up an LLC?
It’s hard to determine the best state to set up an LLC, as each has its own requirements. However, it’s thought it’s best to form an LLC in your home state—especially if this is your first business—because of the extra steps required to register a foreign LLC.
Aside from your home state, some of the perceived best states for registering LLCs include:
Delaware: This state offers total privacy, flexible General Corporation Laws, and low filing and franchise fees. There is also no sales tax or income tax for out-of-state residents.
Nevada: Nevada offers privacy to LLCs and low registry fees. The state allows flexibility in LLC ownership and has no franchise or corporate taxes.
New Mexico: NM offers privacy and low LLC formation fees. Business owners in the state also face no Annual Report or Franchise taxes.
Wyoming: Business owners face no individual income or state tax requirements and no renewal costs in Wyoming. The state also offers complete privacy for LLCs.
Can a PO Box Be Used for an LLC?
A PO box can’t be used as an address when registering for an LLC, as this business formation requires a street address. However, you can use a PO box for mail, but even that could be risky if you work with sensitive information. PO boxes may not be watched, increasing the risk of tampering.
Can I Put Multiple Businesses Under One LLC?
Yes, you can put multiple businesses under one LLC registration. This business formation is known as an umbrella LLC. The question is whether having more than one company under a single LLC is a good idea.
When all companies share the same LLC, they can collectively bear the consequences if something goes wrong within one of them. For example, if you face a lawsuit or file for bankruptcy for one business, all company assets within that LLC can be taken to pay off debts—even if the other organizations weren’t involved. Because of risks like this, many entrepreneurs establish separate LLCs for each business.
Can I Have Multiple Businesses Use the Same Address?
Yes, multiple businesses can use the same address as long as each company is its own separate entity. It’s common for entrepreneurs to have more than one business at the same address to keep everything organized and ensure the receipt of all business mail.
Davinci Offers Virtual Addresses All Over the Country
A business address tells the world a lot about your organization. Sharing a street with well-established companies offers credibility to potential customers and investors. When looking for a business address for your LLC, look no further than Davinci to get what you need.
Not only do we offer virtual addresses, but we also offer multiple amenities to help streamline business operations. We provide incorporation services, office and meeting room rentals, and mail services, to name just a few.